The Federal Government has announced a ban on non-compete clauses
Non‑compete clauses are conditions in employment contracts that prevent or restrict an employee from moving to a competitor, and may prevent them from moving to a better job.
Within the massage industry, non-compete clauses are also commonly included in independent contracting agreements. While these restraints are unlikely to be legally enforceable, they can still cause significant anxiety for therapists. AMT receives a lot of inquiries from members seeking guidance on how these restraints may impact their ability to practice in the same town or local area.
On Tuesday night, the Federal Government used the Federal Budget to announce a ban on non-compete clauses in employment contracts.
The ban targets non-compete clauses in employment contracts, which restrict workers from taking up similar jobs or starting a business in competition with their former employer. The concern is that these clauses are being overused, often unnecessarily, and are limiting worker mobility, wages, and innovation.
So far, the announcement and supporting documents do not explicitly mention independent contractor agreements. However, depending on how the final legislation is drafted, it’s possible that the rules could be extended or interpreted to cover quasi-employment relationships where a person is engaged as a contractor but operates under conditions similar to employment (especially given ongoing scrutiny of sham contracting practices through Closing the Loopholes legislation).
The proposed reforms are still subject to consultation and legislative drafting, so contractors might be included indirectly or via separate legislative changes (e.g. under Fair Work reforms or unfair contract terms law). The ACCC and Treasury have been increasingly critical of anti-competitive behavior in both employment and contracting contexts.
Watch the report on abc news regarding the announcement
Read or listen to the report on abc.net.au
Read the media release on the Treasury website
And watch this space!
Melanie
31/03/2025 - 8:21 am
Thank you. A place I worked at last year had me sign a contract similar saying I could not work within a 25 klm radius of its address. I left after working there for 10 months in a toxic and bullying environment. I have barely worked since and that was 4 months ago since I left. It caused me a lot of anxiety and depression.
admin
03/04/2025 - 1:32 pm
So sorry to hear that you had to endure a toxic workplace and continue to suffer the impact. Unfortunately, your story is far too common. 25 kilometres is a real outlier though! I don’t think people understand that this distance is basically an entire Australian metropolitan city, even with urban sprawl.