Australian employers should begin reviewing employment contracts now rather than waiting for proposed non-compete reforms to take effect in 2027, according to employment and workplace specialist Roger Lewis of arch.law
The Australian Government has announced plans to prohibit non-compete clauses for workers earning below the Fair Work Act high-income threshold, currently $183,100 excluding superannuation.
If implemented as proposed, the changes are expected to apply retrospectively, meaning existing non-compete clauses affecting employees below the threshold would become unenforceable.
Lewis said employers should use the period before implementation to assess potential risks and strengthen alternative protections.
“Many businesses are treating the reforms as something that will need attention in 2027, but there is value in reviewing contracts and employment protections now,” he said.
“Organisations should identify which employees may fall below the threshold, review existing restrictive covenant provisions and ensure other contractual protections remain fit for purpose.”
Lewis said employers should consider strengthening confidentiality provisions, reviewing non-solicitation clauses, assessing how client relationships are managed internally and ensuring commercially sensitive information is appropriately protected.
He also warned businesses operating across multiple jurisdictions not to rely on standardised global employment contracts without local review.
“Employment contracts are often rolled out across regions with minimal variation. Businesses should ensure Australian-specific legal requirements are properly reflected rather than assuming existing templates will remain effective.”
Lewis said the proposed reforms would require employers to place greater emphasis on practical measures that protect client relationships and confidential information throughout the employment lifecycle.
