Labor's non-competes ban: no-brainer, or skills killer?

Labor’s ban on non-compete clauses could end up extending to white-collar workers earning well above the reported $175,000 a year income threshold.

Workplace Relations Minister Murray Watt said as much at The Australian Financial Review Workforce Summit on Tuesday when he revealed the ban’s income threshold applied to an employee’s base salary, not their overall pay.

That means workers who earn less than $175,000 a year in base pay, but earn much more than that when bonuses are included, could not be constrained by non-compete clauses under Labor’s reforms and could move jobs much more easily as a result.

“We will consult about the implementation of this, but the intent would be to focus on base pay,” Watt told the Summit.

Labor has argued the ban will help lift wages and improve productivity by encouraging greater job mobility, which economic research has linked to better pay rises.

But employment lawyers have warned the reform could stifle merger-and-acquisition activity by encouraging companies to poach their rivals’ best employees rather than buying the entire business outright.

“They need to be very thoughtful around the implementation, and that will be the key with this policy to ensure that it delivers the benefits ... without actually creating a secondary or any inadvertent consequences for us,” BHP chief people officer Jad Vodopija told the Summit.

Chief economist for HSBC in Australia Paul Bloxham , who took part in the same panel discussion as Vodopija, said the economic literature on the prohibition of non-compete clauses was mixed and suggested their success ultimately depended on their implementation.

In theory, making it easier for people to move jobs should lift productivity by leading to “a more efficient distribution of workers across your economy”.

But Bloxham said a ban could also make some companies less productive, by discouraging them to upskill their staff.

“If you get a lot of junior people in, and you train them up, and then they take their training and move on to the next place relatively quickly, it disincentivises you to put that training there in the first place,” the economist said, adding this was probably a bigger problem for small to medium-sized companies.

“If we don’t get the training … that might weaken productivity.”

How best to address Australia’s weak productivity growth ended up becoming a major topic of discussion at the Summit. Chanticleer columnist Anthony Macdonald wrote the ensuing debate revealed a chasm between government and big business.

Other major topics included the divergent (or not) expectations of Gen Z workers, the unintended consequences of DEI quotas, and the major political parties’ different positions on working from home.

Elsewhere this week, WiseTech Global whistleblower Christine Holman reveals she was told she would never get another board role after quitting the technology company and accusing its billionaire founder Richard White of intimidation, bullying and poor corporate governance.

Other top stories included this yarn stat suggests the death of WFH is greatly exaggerated, why Workday 's Simon Tate reckons tech-savvy 20-year-olds should be given board seats, and why former sex discrimination commissioner Pru Goward says Labor’s new DEI laws dismissed as government overreach.

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Tariffied

US president Donald Trump's "Liberation Day" tariffs have rocked the markets, confused many, and sent the social media meme machine into overdrive. Get all our news and analysis on Trump's trade war here.

Trump’s colossal misjudgment will cost the US – and the world – dearly Donald Trump is pretending the sharemarket carnage is all part of his grand plan to use tariffs to reboot the US economy, writes Jennifer Hewett . What happens when Main Street revolts?

Trump’s tariffs could hit Australian Boomers like nothing before The superannuation sector has become a major driver of spending, so a market meltdown could flow through to the broader economy in a way we haven’t seen before, writes Chanticleer columnist James Thomson .

Trump just gave China a free kick to tilt Asia in its favour Poor South-East Asian and Pacific nations are among the hardest hit by US tariffs, handing an advantage to Beijing in the race for regional influence, writes Andrew Tillett .

This week on 15 Minutes with the Boss, Boost Juice founder Janine Allis discusses her favourite health hacks and why she doesn't believe in imposter syndrome. Listen now on Apple, Spotify, or wherever you get your podcasts.

Election wrap

Who won the first week of the election campaign With week one done, we asked former political staffers Lidija Ivanovski and David Hughes which leader edged ahead on the election trail.

How Labor is running rings around the Coalition with base politics Peter Dutton needs people around him to start getting their hands dirty as the government makes it all about him, writes politics editor Phil Coorey.

Who’s leading in the polls, plus everything else you need to know With campaigning well under way, here’s the full rundown on the 2025 federal election.

Follow the leader See where Anthony Albanese and Peter Dutton have campaigned so far with our interactive map.

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