Employment Law for the Time Poor

A podcast from Piper Alderman's Employment Relations team where they discuss the important topics in employment law in Australia.

#44 - Employment Relations Podcast: When is the deal done? Resolving employment disputes 06/30/2025

#43 – Federal Election 2025: What is being proposed for industrial relations reform? 04/23/2025

#42 – What could the proposed ban on "non-competes" mean for Australian employers? 03/31/2025

#41 – Understanding the Employment Law Considerations in Defence Export Controls 12/18/2024

#40 – Understanding the Australian Right to Disconnect 08/23/2024

#39 – Restraints on restraints! What the United States’ ban on non-compete clauses could mean for Australian businesses 08/19/2024

#39 – Restraints on restraints! What the United States’ ban on non-compete clauses could mean for Australian businesses The United States is planning to heavily restrict the use of non-compete clauses in employment contracts, and the Australian Government has released an issues paper discussing the subject in the Australian context. In this episode of Employment Law for the Time Poor, Emily Haar, Prof. Andrew Stewart and Dustin Grant discuss the current state of the law on post-employment restraints, what proposals for limitations on such restraints could look like, and what employers can do now to best protect their interests. . In April 2024, the US Federal Trade Commission (FTC) voted to ban non-compete clauses in employment contracts, for employees other than “senior executives”, being anyone earning more than $151,164USD per year and who are in a “policy-making position”. In the FTC’s view, this ban will help both employees and employers by promoting competition, wages growth and innovation. It is worth noting this ban is currently subject to several legal challenges, which will determine whether it ultimately comes into effect, and in what form. Several US States (with the most notable being California) have similar bans in place already, for employment contracts within those states. The Issues Paper recently released by the Australian Government was commissioned in August 2023 as part of a broader policy consideration of the Government’s “intent to investigate non-compete clauses”. Whilst the FTC’s ban might have caused more headlines outside of employment law news websites, the issue has long been a matter of keen interest for Andrew Leigh, the current Assistant Minister for Employment, and Assistant Minister for Competition. What are restraints of trade? First, it is important to clarify what is meant by a “restraint of trade”; an umbrella term for several types of contractual terms that can be included in employment contracts. The Issues Paper defines these categories or ‘types’ of restraints to include: 1. Non-compete – clauses that restrict a former employee from working for a competitor or establishing a competing business; 2. Non-solicitation – clauses that restrict a former employee from ‘soliciting’ other workers, or clients, of the employer to switch to the employee’s new business; and 3. Non-disclosure – clauses that seek to protect confidential or sensitive information, such as unique processes, technologies or strategies of the employer. The law in Australia As the law in Australia currently stands, the issue is dealt with by common law (other than NSW which has the Restraints of Trade Act 1976 (NSW)). The underlying position is that all restraints of trade are presumed to be unenforceable and contrary to the public interest, unless the party relying on the clause can prove that they are “reasonably necessary to protect the legitimate interests of the employer”. However, practically, where an employer seeks to enforce a contractual non-compete term, engaging in potentially uncertain litigation is often not commercially viable for an employee. So the real impact of restraint clauses may be their deterrent or chilling effect: even if not always enforced by employers, or potentially invalid, they may still have the desired effect on employees. The Competition Review’s Issues Paper Ultimately, the Issues Paper highlights 3 key “issues” related to restraints; the “chilling effect” such clauses have on worker mobility, particularly in lower-income groups, the high cost of litigation and relying on common law which causes confusion to both workers and business, and the economic consequences caused by hampering growth, competition and innovation. At this stage, we can only speculate as to what any potential ban or limitation in Australia may look like, as the Government is still in its consultation phase. A number of potential reforms are discussed in the podcast episode. What can your business do now? Regardless of whether we see significant reform in this area, when it comes to protecting an organisation’s confidential information, client connections, and existing staffing mix, prevention is always better than a cure. Properly protecting confidential information through technology, training and up-to-date workplace policies, and ensuring your workplace is one where staff do not necessarily want to look to greener pastures elsewhere, will have a greater impact than solely seeking to rely on restraints after they have already left. If your business uses post-employment restraint clauses in its template employment contracts, it is a good idea to have these regularly reviewed to ensure they have the appropriate scope and application to your business, along with your policies to ensure they provide the required protection. You can contact Piper Alderman’s Employment Relations team for specific advice on your needs. Non-competes and other restraints: understanding the impacts on jobs, business and productivity – The Competition Review Taskforce, April 2024 Herbert Morris Ltd v Saxelby [1916] 1 AC 688 /episode/index/show/piperalderman/id/32633982

#38 – Wage Theft: Go Directly to Jail? 05/20/2024

#37 – Closing Loopholes No. 2: Considering Complexities 02/11/2024

#36 – What does a psychosocially safe workplace look like? 12/19/2023

#35 – The Governance of Decision Making in the Post-Qantas Environment 10/25/2023

#34 – Do You See What I See? The Closing Loopholes Bill 09/12/2023

#33 - National WHS Update: Industrial Manslaughter Laws and the Prohibition of Insurance 05/19/2023

#33 - National WHS Update: Industrial Manslaughter Laws and the Prohibition of Insurance Industrial manslaughter may soon be an offence in almost all Australian jurisdictions. Recent amendments in certain jurisdictions have also introduced the recommendation of the 2019 Boland Review to prohibit insurance and indemnities for WHS penalties. In this episode of Employment Law for the Time Poor, join Emily Haar, Partner, and Joseph Hyde, Associate, for a review of the current status of these provisions, with a particular focus on the South Australian proposed industrial manslaughter legislation. With Labor governments having been recently elected in South Australia, New South Wales, as well as federally, the issue of industrial manslaughter is back on the agenda. South Australia, New South Wales, and Tasmania are the only remaining States that have not yet expressly legislated for this offence. However, public consultation on South Australia’s draft Work Health and Safety (Industrial Manslaughter) Amendment Bill has finished, with the Government now considering the feedback that was provided. The recently elected NSW Labor Government had attempted to introduce industrial manslaughter legislation in 2021. While there is no current Bill before parliament, it is likely to be on the Parliamentary agenda. At the Commonwealth level, the national model WHS laws are planned to be amended to include the offence of industrial manslaughter, following Australia's WHS ministers agreeing to the move in late February 2023. The offence generally captures negligent or reckless conduct of a person conducting a business or undertaking (PCBU) or its officers that breaches health and safety duties and causes the death of a person to whom a duty was owed. However, the details of the offence vary slightly in each jurisdiction. Jurisdiction Law in force Law being considered Maximum penalties Elements of offence Prohibition against insurance SA ✓ Body corporate: $15 million. Individuals: 20 years Would apply to officers or individuals acting as PCBUs who engage in reckless or grossly negligent conduct causing the death of an individual to whom a health and safety duty is owed. Not presently included in Bill Vic ✓ Body corporate: nearly $18.5 million. Individuals: 25 years imprisonment. Negligent conduct by persons, including an employer and its officers, which breaches a duty and which causes the death of an employee or member of the public ✓ Qld ✓ Body corporate: $14.375 million. Individuals: 20 years imprisonment. A PCBU or a senior officer’s conduct negligently causes the death of a worker. Includes where a worker is injured carrying out work and later dies. X WA ✓ Body corporate: $10 million. Individuals: 20 years imprisonment and/or $5 million fine. A PCBU engages in conduct that constitutes a failure to comply with their health and safety duty, knowing it is likely to cause the death or serious harm to another person, and causes the death of an individual. Officers may also be charged but additional elements of the offences must be proven. ✓ NT ✓ Body corporate: just over $10.5 million. Individuals: life imprisonment. A PCBU or officer intentionally engages in conduct that breaches their health and safety duty and causes the death of an individual to whom that duty was owed, and is reckless or negligent about the conduct and causing the death of that individual. X ACT ✓ Body corporate: $16.5 million. Individuals: 20 years imprisonment. A PCBU or officer engages in conduct that breaches their health and safety duty and causes the death of an individual to whom that duty was owed, and is reckless or negligent about the conduct. X NSW ✓ (No current Bill before Parliament) Note to Division 5 states: “In certain circumstances, the death of a person at work may also constitute manslaughter under the Crimes Act 1900 and may be prosecuted under that Act. See section 18 of the Crimes Act 1900, which provides for the offence of manslaughter, and section 24 of that Act, which provides that the offence of manslaughter is punishable by imprisonment for 25 years.” ✓ Tas No current provision X Cth ✓ Body corporate: $18 million. Individuals: 20 years imprisonment. ✓ (Commences on a date to be fixed by proclamation or otherwise 22 September 2023) Victoria, Queensland, and the Northern Territory adopt a penalty unit system, meaning the maximum penalties will increase each year. Tasmania is currently the only jurisdiction whose government has not expressed their intention to introduce the offence. There have been recent calls for Tasmania to introduce industrial manslaughter laws, on International Worker’s Memorial Day (28 April 2023), Unions called on the Parliament to commit to introducing the offence. Unions Tasmania secretary Jessica Munday says that "Tasmania is now out of step with the rest of Australia." The prohibition of insurance and indemnities for work health and safety penalties was recommended in the Marie Boland Review of the Model WHS Laws published in February 2019, and also the Senate Inquiry into industrial deaths published in October 2018. This prohibition has been implemented in the recent Work Health and Safety Amendment Act 2023 (Cth), as well as in NSW, Victoria and WA. /episode/index/show/piperalderman/id/26887380