COSBOA warns against NSW AI arbitration proposals

Urges innovation-first approach to workplace technology

The Council of Small Business Organisations Australia (COSBOA) has expressed serious concerns about NSW Labor Government proposals to force union-business AI disputes in the workplace into arbitration, warning the move could undermine Australia’s competitive advantage and damage the Federal Government’s productivity agenda.

COSBOA Chair Matthew Addison said the proposal shows a fundamental misunderstanding of how artificial intelligence can drive productivity, innovation and prosperity for Australian businesses and workers.

“This is about riding the wave of technological change that will define Australia’s economic future,” Mr Addison said. “While COSBOA supports the broader industry joint statement on responsible AI adoption, we are deeply concerned about unions using AI as a lever to impose further regulatory burdens that will ultimately cost jobs rather than protect them.”

Mr Addison said AI is already creating jobs, not destroying them, with recent data showing 68% of small businesses using AI, 74% planning business growth in 2025, and 80% reporting that AI is enhancing rather than replacing their workforce.

“With one-third of our workforce in shortage – including 53% in construction and 60% in the care economy – AI is helping fill the jobs we desperately need. Nearly 40% of small businesses using AI say it will allow them to create new jobs next year.”

He warned that excessive union control over AI deployment would damage business confidence and investment. “If we keep erecting barriers, companies won’t invest, and they won’t create more jobs. They will go where the regulatory environment has a light touch, not a heavy hand. Every major technological revolution, from the cotton gin to the internet, has reshaped jobs – and created more opportunities for workers and businesses.”

Mr Addison stressed that existing protections are already adequate. “We have strong workplace protection frameworks through the National Employment Standards and modern awards, which set clear obligations on employers when implementing technological change. Governments should focus on guiding change, not controlling it at the business level.”

COSBOA is urging the Federal Government to ensure a consistent, national approach to AI regulation that supports innovation, productivity and job creation.

“Our goal should be to ensure that as AI reshapes work, people are brought along, not left behind. The best thing we can do is lean into technological change with courage and clarity,” Mr Addison said. “Australia is well-poised to lead the world in AI take-up – but only if we get the regulatory settings right.”

For more information, visit www.cosboa.org.au.  

-ENDS-

For media enquiries or interviews, please contact Matthew Addison, Chair, COSBOA on chair@cosboa.org.au or call +61 (0) 421 553 613.

About COSBOA

Established in 1979, The Council of Small Business Organisations Australia (COSBOA) is a member based not-for-profit organisation exclusively representing the interests of small businesses. The capability, representation, and reach of COSBOA are defined by a mix of over 50 national and state-based members. COSBOA's strength is its capacity to harness its members' views and advance consensus across policy areas common to many.

Our member organisations work with the COSBOA team to assist us with policy development and guide our advocacy - not just for small businesses but also for the benefit of the Australians they employ. In this capacity, COSBOA makes submissions and representations to the government, including its agencies, on issues affecting small businesses and to pursue good policy.

For more information, visit www.cosboa.org.au