Non-compete reform is in draft: what employed hairdressers should know now

Abby's take

What this means for the industry — and for independents

Industry impact. The draft reform directly addresses labour mobility in occupations including hairdressing. If enacted, it could change how salons protect legitimate interests and how employees assess moves, while increasing the importance of precise confidentiality, client-record and conduct protections instead of broad post-employment bans.

For freelancers. An employed hairdresser planning independence may gain clearer mobility rights in future, but the draft does not authorise taking a salon's database, copying confidential information or ignoring a current contract. Transition planning still needs clean records, careful client communication and legal advice where a restraint exists.

What I'd do next

• Download the signed employment agreement and identify non-compete, client non-solicitation, co-worker non-solicitation, confidentiality and intellectual-property clauses separately.
• Record the proposed threshold and timing accurately, noting that the draft must still pass Parliament and is intended to take effect in 2027.
• Do not copy client lists, formulas, pricing files, photos or other business information without clear authority while reviewing a possible move.
• Submit practical feedback through Treasury before 2 October 2026 or obtain employment-law advice about how the current contract applies now.

Watch-out. This is general information, not employment or legal advice. The proposal is draft legislation and may change or fail to pass. Current contracts and law continue to apply; seek advice before acting on a restraint.

What the government released

On 7 September 2026, the Australian Government released draft legislation to ban non-compete clauses for workers earning below the Fair Work Act high-income threshold, currently $190,100 a year. The government's announcement expressly includes hairdressers among workers affected by widespread restraints.

Submissions on the exposure draft are open through the Treasury consultation hub until 2 October 2026. Treasury's policy page says the reforms are intended to take effect in 2027 after consultation and legislation passes Parliament. That future and conditional timing matters.

What a non-compete clause does

Treasury describes a non-compete as an employment condition that prevents or restricts a worker from moving to a competitor, often for a defined period or within a geographic area. It is different from a clause protecting confidential information or restricting active solicitation of clients or co-workers.

Read the exact words in the signed agreement. Salon contracts sometimes group several restraints under one heading or use cascading periods and distances. A clause saying you cannot work within ten kilometres is doing a different job from one saying you cannot take or approach clients from the salon database.

Separate employment from genuine independent contracting

The proposal is broader than one clause

The government is also consulting on co-worker non-solicitation clauses, no-poach and wage-fixing arrangements, cascading restraints, exemptions and safeguards for legitimate business interests. Those issues are still being tested through the draft process.

Client non-solicitation is not the same as a non-compete. Government commentary on the proposal has said client non-solicitation protections can remain, while co-worker restraints are part of the reform discussion. Do not assume permission to change workplaces equals permission to transfer client data or actively solicit every client.

What employed hairdressers should do now

Get the executed agreement, later variations, policy acknowledgements and any correspondence about the restraint. Mark the parties, role, geographic area, duration, activities restricted and the clause the employer says protects clients or information.

Keep personal evidence of your own qualifications, public portfolio and contacts developed independently, but do not export the salon's booking system, client notes, colour formulas, sales reports or internal pricing. If the boundary is disputed, get advice before announcing the move or contacting clients.

Review the client-relationship distinction · Test client-following assumptions carefully

What salon employers should review

Salon employers should identify which contracts use broad non-competes and what legitimate risk each clause is intended to manage. A blanket restriction may be a weak substitute for good access controls, current confidentiality wording, accurate client-record ownership and a consistent exit process.

Do not delete protections or rewrite contracts from a media summary. Ask an employment lawyer to review the draft against the workforce, threshold, commencement provisions and any proposed exemptions, then plan updates only when the legal position is settled.

How to give useful consultation feedback

A useful submission explains the actual clause, role and consequence. Workers can describe whether a restraint discouraged a job move, delayed independent work or created advice costs. Employers can explain the specific information or relationship they need to protect and whether a narrower measure would work.

Avoid submitting client names, confidential commercial information or material you are not authorised to publish. Explain what the proposed threshold, exemptions, transition period or treatment of cascading clauses would mean in practice.

Plan the move under today's rules

Until legislation passes and commences, the current contract and law remain the operating position. Build the independent plan without depending on the reform: calculate the runway, confirm the workspace, create lawful marketing channels and prepare a client-communication approach that does not use unauthorised records.

If the existing restraint affects timing or location, take the agreement to an adviser early. The cost of advice before resigning can be materially lower than trying to repair a rushed transition after a dispute starts.

Build a staged transition without assuming the reform is law

Common questions