Federal election 2025 result: Employment and industrial relations reforms

Following the re-election of the Albanese Labor Government, employers can expect further industrial relations reform underpinned by principles to provide increased employee and union protections. Many businesses are likely to be impacted by changes including the continued regulation of labour hire, changes to superannuation and post-employment restraints with the reforms set to benefit a broad cross-section of Australian workers.

Below, we outline the key election reforms likely to affect employers over the coming years.

 ‘Same job, same pay’ for labour hire

The Liberal party had mooted the possible repeal of the ‘same job same pay’ reforms which were passed as part of the Fair Work Legislation (Closing Loopholes) Act 2023 (Cth) and took effect in November 2024 when the Fair Work Commission was empowered to make regulated labour hire orders.

Labour hire employers and those who procure labour hire services will receive further guidance from the Fair Work Commissions as it considers more applications under the legislation which is aimed at addressing pay inequity between labour hire and directly engaged employees. Under the legislation, labour hire workers are entitled to receive the same remuneration as employees directly engaged by the host employer when performing equivalent duties.

ASX-listed companies with substantial labour hire arrangements, including BHP, Downer EDI, Whitehaven Coal, and Qantas, have already experienced the financial and administrative impact of these reforms. Notably, Qantas reported a $22m compliance cost attributable to the new regime in the first half of the 2025 financial year alone.

Employers engaging labour hire should review contractual arrangements and workforce models to ensure compliance, and consider the broader operational, financial, and industrial implications of these provisions.

Payday superannuation – Increased frequency of employer contributions

Effective 1 July 2026, employers will be required to remit superannuation contributions on the same day employees are paid wages or salaries, whether that occurs on a weekly, fortnightly, or monthly basis. This reform—commonly referred to as ‘payday super’— is a change from the current quarterly contribution schedule.

The primary objective is to improve the timeliness of superannuation payments and reduce the prevalence of unpaid super, particularly benefiting employees in casual, part-time, or lower-income employment. Employers should ensure their payroll systems and internal processes are prepared for this transition to avoid potential compliance issues or penalties.

National labour hire licensing scheme – Harmonisation ahead

The Federal Government has reaffirmed its intention to implement a national labour hire licensing regime, streamlining existing regulatory frameworks currently governed at the state and territory level.

This reform seeks to:

• Enhance the protection of vulnerable labour hire workers;
• Improve enforcement of workplace laws across industries reliant on outsourced labour; and
• Reduce duplicative regulatory burdens for businesses operating across multiple jurisdictions.

While a commencement date is yet to be confirmed, preliminary consultation has been underway since 2023. Labour hire employers and those who procure labour hire should monitor developments closely and assess the impact of obligations under the new scheme.

Restrictions on post-employment restraints – Major reform proposed for 2027

The Government has proposed legislation that would render unenforceable non-compete clauses in employment contracts for employees earning below the high-income threshold—currently set at $175,000.

Under the proposed changes:

• Employers would be prohibited from including non-compete clauses in new employment contracts for individuals below the income threshold;
• Civil penalties may apply for employers who continue to include such clauses in contravention of the law; and
• The reform would apply prospectively and not affect contracts entered into prior to the commencement of the legislation.

Consultation is expected to explore whether limited exceptions should apply in specific sectors—such as financial services—where employee remuneration often includes variable commission components. The treatment of related provisions, such as non-solicitation and non-poaching clauses, remains under consideration, although preliminary indications suggest non-poaching clauses may also be rendered invalid.

This development is anticipated to affect a broad range of professions including financial planners, sales professionals, IT specialists, IVF clinicians, and even certain senior legal roles. Employers should begin reviewing their restraint clauses to ensure alignment with future legislative requirements.

Fair Work Commission appointments

The re-election of the Labor Government is likely to see a continuation of new appointments to the Fair Work Commission. Since coming into office three years ago, the Government has appointed several members with backgrounds in union advocacy or employee representation, reflecting its stated commitment to ‘rebalancing’ the Commission.

The changing composition of appointments may continue to have an impact on the Commission’s approach to dispute resolution, award decisions and standard setting. Further change to address gender equity should also be expected through the expert panel framework.

Next steps for employers

These reforms signal a continued shift toward increased employee protections and further regulation of employer practices. Businesses are encouraged to:

• Continue to monitor labour hire arrangements;
• Get payroll systems ready for payday superannuation changes next year; and
• Review current practices to restrict post-employment competition and plan for potential changes if legislative reform is passed.

Our Workplace Advisory and Disputes team is closely monitoring these developments and is available to assist employers with compliance strategies, policy updates, and workforce restructuring advice to mitigate risk.

If you require assistance ensuring your workplace is compliant with the latest workplace reforms and pay practices, please contact our team of Employment Advisory experts.

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Authored by:
Amanda Junkeer, Partner
Deivina Peethamparam, Partner
Zoe Firmin, Lawyer