The Federal Government's proposed ban on non-compete clauses will hurt the workers it claims to help

Attwood Marshall Lawyers

FOR IMMEDIATE PUBLICATION

14 May 2025

The Federal Government’s proposed ban on non-compete clauses will hurt the workers it claims to help

Attwood Marshall Lawyers has cautioned that the Federal Government’s proposed ban on non-compete clauses for lower-income workers could create more problems than it solves—particularly for small to medium-sized businesses.

Announced in the 2025 Federal Budget, the proposed legislation would prohibit non-compete clauses for employees earning under $175,000, impacting industries such as childcare, hairdressing, and construction. The Government argues the change will increase wages and job mobility for millions of Australians, with projected economic benefits of up to $5 billion.

However, Charles Lethbridge, Attwood Marshall Lawyers’ Commercial Litigation Partner and NSW Law Society Accredited Specialist in Dispute Resolution, warns that the reforms may weaken essential business protections.

“Non-compete clauses exist for good reason—they help protect client relationships, sensitive commercial information, and business goodwill. If removed without a proper alternative, employers risk having staff walk away with valuable contacts and trade secrets.”

“Removing these protections could devalue goodwill in professional practices, impacting valuations and succession plans.  We encourage the Government to consult further with legal and business experts to ensure the reforms don’t unintentionally harm the very workers and businesses they aim to support.”

Attwood Marshall Lawyers supports fairer, more transparent employment practices but urges a balanced approach, considering the broader implications for industries like financial services, where client relationships are often a key business asset.

-ENDS-

Note to editors

Attwood Marshall Lawyers’ Commercial Litigation Partner, Charles Lethbridge is available for interview. Please contact Shan Harvey, Media Specialist on 0438 772 752 or [email protected]

• To see our previous interviews in the media, visit our ‘In The Media’ web page here.
• Attwood Marshall Lawyers’ also have an extensive library of articles on diverse areas of law. Please visit our blog archive here.

Established in 1946, Attwood Marshall Lawyers is a leading law firm providing expert legal services in all areas of law including wills and estates, aged care, estate litigation, family law, compensation law, commercial litigation, property and commercial law, and equine breeding and racing law.

Find out more about Attwood Marshall Lawyers at https://attwoodmarshall.com.au 

Shan Harvey      

Media Specialist

Ph: 0438 772 752 or 07 5553 5803
[email protected]