What a re-elected Labor Government means for recruitment in Australia

Written By: Steve Smith Founder and Managing Director, Sirius People & APSCo Australia chair

With Labor securing another term in government following the recent federal election, recruitment agencies across Australia are now preparing for a new wave of industrial reforms that could significantly reshape the way we operate.

From workplace law changes and wage protections to award modernisation and contractor rights, the Albanese government is doubling down on its commitment to building a fairer, more secure employment landscape. And while that creates complexity in some areas, it also unlocks opportunities, particularly for agencies that can adapt early and offer real value to clients navigating change.

Breaking Down the Non-Compete Ban

One of the headline reforms now set to become law is the banning of non-compete clauses for workers earning under $175,000 a year (excluding super). For years, these clauses have been a staple in our industry, offering agencies and clients a way to protect intellectual property, commercial relationships, and candidate exclusivity.

That’s about to change Under Labor’s policy, these clauses will be unenforceable for the vast majority of candidates we place. Agencies will need to reframe how they manage risk and retain talent. Building strong relationships, offering career progression, and aligning values will be more important than ever. It’s a wake-up call to shift away from legalistic protection models toward trust-based, high-value partnerships with both clients and candidates.

Penalty Rates Here to Stay

Labor has confirmed it will lock in protections for penalty rates, preventing employers from offering higher base pay in exchange for reduced entitlements. This is particularly relevant for agencies operating in healthcare, retail, and hospitality, where such trade-offs have historically been common. We’ll need to carefully review pay structures and ensure that bundled rates continue to meet award compliance. For clients, it may mean revisiting their expectations on flexibility and cost and for agencies, it's a chance to play a more advisory role in helping navigate compliant solutions.

A Boost for Care Sector Recruitment

Another positive for our industry is the government’s renewed focus on the community and disability sectors, with funding allocated to modernise the SCHADS Award and improve career pathways. This could see increased demand for quality candidates and stronger retention across the sector provided we can support employers in understanding the new classifications and pay structures.

As someone who recruits in this space, I see this as a genuine opportunity. Agencies that specialise in care work, or are looking to enter the sector, should position themselves early to ride this wave of change.

Same Job, Same Pay – The New Normal

Labor’s ‘Same Job, Same Pay’ law will remain a key feature of the industrial landscape, ensuring labour-hire workers are paid the same as their permanent counterparts. This is a significant shift in how agencies negotiate rates and build proposals.

It introduces a level of complexity particularly around award interpretation but it also creates a clear mandate for professionalism and transparency. Agencies that can demonstrate compliance and educate clients on their obligations will be well positioned to maintain long-term partnerships.

Greater Rights for Casual and Contract Workers

The government has signalled its intention to review definitions of casual work and contractor arrangements, pushing towards more secure forms of employment. For the recruitment sector, that means tighter scrutiny and a higher compliance bar when it comes to classification, rostering, and documentation.

We should view this not as a threat, but as a call to lift standards. Casual and contract work will always have a place in the economy, but the expectation is shifting. Workers want flexibility and fairness. Agencies that can offer both will continue to thrive.

Opportunity Amid Change

Labor’s return to government is not without challenges for our sector. Yes, it will mean more regulation. Yes, it will place new demands on how we structure agreements and contracts. But it also provides an opportunity for our industry to lead.

We’re being asked to do more than just fill jobs. We’re being asked to advise, to educate, and to raise the bar.

Whether it’s helping a healthcare provider navigate new penalty rate rules, guiding a tech startup through the end of non-compete clauses, or working with NDIS providers on SCHADS Award updates, recruitment agencies have the chance to be part of the solution.

Final Thoughts

This election result confirms the direction of travel: toward greater protections for workers and more accountability for employers and intermediaries. It’s a cultural shift as much as a legislative one. The most successful agencies over the next few years will be those that embrace this shift, invest in compliance and advisory capability, and commit to delivering value beyond placements.

At APSCo, we’ll continue working closely with government and regulators to ensure the voice of professional staffing firms is heard, and that agencies have the tools and support they need to adapt and succeed.

If ever there was a time to lead from the front, this is it.