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NSW Department of Planning, Industry and Environment
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The NSW Government is committed to supporting a productive economy by enabling business and jobs in the locations where they are needed and delivering on the communities’ strategic vision for their state.


The Department of Planning, Industry and Environment is currently undertaking a suite of reforms which includes the delivery of a simplified employment zones framework that suits the future of work, is fit for purpose, supports productivity and jobs growth while facilitating delivery of strategic plans and planning priorities.


The reform of employment zones aims to support long-term economic recovery through job creation and encourage increased productivity in NSW.


A key outcome of the project will be to ensure employment zones provide clear strategic intent, include clarity around their application and increase flexibility around land uses.


What are we doing?

The department exhibited a proposal to replace the existing Business (B) and Industrial (IN) zones with five new employment zones and three supporting zones under Standard Instrument Principal Local Environmental Plan (2006) (SI LEP). 


We have developed the proposed employment zones framework based on quantitative and qualitative evidence to:

  • Maximise productivity while minimising land use conflicts and ensuring they are fit for purpose
  • Address current barriers within the planning system that limit the ability of businesses to establish, expand or adapt, and
  • Better support councils in the delivery of the strategic vision contained in their Local Strategic Planning Statements and background studies. 


How are we doing it?

The department has undertaken research through a quantitative and qualitative evidence base that has informed the proposed employment zones framework and implementation approach. 


A critical component of the department’s research was the stakeholder engagement program which involved working with other state agencies, all councils in NSW as well as key peak, industry and stakeholder groups to understand the current barriers within the existing zoning framework. 


We heard from councils, industry and government agencies that there is lack of clarity surrounding the purpose of several of the existing zones, that land use tables are inflexible, definitions reflect outdated business models and create land use conflicts, and that there is inconsistent application of the zones across the State. 


Feedback received in local government workshops is that councils want a zoning framework that supports good planning outcomes that includes: a centres hierarchy, manages contemporary land use conflicts, sustains employment lands and creates a nexus between the zones and strategic planning. 


We will continue to work closely with local government and have detailed discussions with our key stakeholders throughout the reform process. 


Why are we doing it?

Benefits of the proposed changes include: 

  • A more legible suite of zones – clear strategic intent for each zone that builds on strategic work by the State and local government over the past five years 
  • Greater flexibility within the proposed zones – across the proposed employment zones framework an additional 97 mandated permitted uses. 
  • Vibrant and viable centres for communities – by retaining core retail uses in centres. 
  • Support for the city to develop and meet the operational needs of businesses and communities – support for urban services uses by providing a dedicated zone 
  • Innovation for emerging land uses and unique precincts that require a flexible planning response – a new zone that facilitates detailed precinct planning to support local enterprise. 
  • Managing industrial land use conflicts and amenity impacts – Two industrial zones appropriate to protect different scale of employment activities and to provide a buffer to incompatible land uses. 
  • Responding to the changing nature of industry and business – three new land use terms and an update to six existing terms to meet contemporary needs. 
  • Reduce need for a spot rezoning – increase in mandated permitted land uses in zones allows greater options for businesses to establish, expand or pivot without the need for a planning proposal.
  • Increase in jobs closer to homes reduces journey to work – more employment generating uses permitted in centres and industrial precincts reduces the need for long commutes improving productivity and reducing costs.
  • Reduce administrative costs and complexity of future application processes – proposed employment zones framework will facilitate expanded application of complying development which has significant cost savings from faster approvals meaning reduced holding costs.
  • Greater business output potential – increase in mandated permitted land uses results in greater access to potential sites and opportunity for diverse businesses to co-locate with associated productivity gains.


Consultation and feedback

The proposed employment zones framework was on public exhibition from 20 May 2021 until 30 June 2021. All submissions received by the department have now been considered. Your feedback will help shape and refine the proposed employment zones framework.


The submissions report outlines which groups provided submissions, how many submissions were received, and summarises the key issues raised. The submissions are published on the Planning Portal.


Policy Finalisation

Overall, there was general support for the intent of the reforms and the overall framework. Individual submissions express the different views and interests of local government, industry and peak groups, consultant planners, academics and the community. We have sought to balance these interests in finalising the employment zones framework.


Supporting jobs and productivity, alongside supporting delivery of councils’ long-term strategic planning objectives and priorities continues to be the central purpose of this reform. Overall, the new employment zones framework will:

  • provide greater certainty for the community, councils, and the development industry
  • support councils’ long-term strategic planning objectives
  • support businesses, industry, and society to grow, respond and adapt as necessary, and
  • facilitate innovation and changes in business processes now and into the future.


In response to the feedback received on the position paper we are proposing to make several changes to the employment zones framework. The following changes to the policy are proposed as we finalise the employment zones framework:

  • update to the land uses that are permissible in the proposed local centre and commercial core zones in response to feedback by mandating certain child terms rather than the parent term ‘tourist and visitor accommodation’ in response to raised land use conflicts
  • rework the objectives to better reflect the strategic intent of the finalised employment zones
  • rename the W4 zone to ‘Working Waterfront’
  • amend the definition of ‘Shop top housing’ to allow more than ground floor non residential uses
  • amend the definition of ‘high technology industry’ to incorporate deep technology industries
  • remove the mandated prohibition of aquaculture in several existing and proposed zones – councils will be able to set permissibility within land use tables and the Primary Production and Rural Development SEPP 2019 will continue to apply
  • remove ‘domestic’ from the new land use term ‘Domestic goods repair and reuse facility’ and place it under the ‘Business premise’ parent term
  • tighten the wording around ‘creative industries’, relate it to cultural products and remove reference to certain activities that can already be accommodated under other land use terms
  • allow for certain mandated land uses council to determine whether those land uses are ‘permitted with consent’ or ‘permitted without consent’ (i.e. home businesses, building and business identification signage)
  • not proceed with the exhibited consolidation of land use term definitions: home improvement retail premises, trades retail premises, and storage and distribution premises – these land uses will remain as currently defined
  • inclusion of the position paper discussed SP4 Local Enterprise Zone and provide further direction on the purpose, application, and criteria to be considered when seeking to apply the zone
  • develop additional mechanisms to manage land use conflicts that may arise from increasing the permitted uses within certain new land use zones.


Next steps

From here, the department intends to finalise the legal drafting of the employment zones framework and publish the framework in an Amendment Order to the Standard Instrument - Principal Local Environmental Plan. This will introduce the new employment zones alongside the existing Business and Industrial zones and will enable implementation into individual local environmental plans to commence. The timing for this is anticipated to be mid-September 2021.


Following the Amendment Order being published the department will provide to councils for review proposed zone translation detail including:

  • draft land use tables that have been compiled from the mandated land uses within the Amendment Order combined with the permitted and prohibited land uses that existing within individual zone land use tables within local environmental plans, and
  • recommendations around local provisions, schedule 1 additional permitted uses and planning proposals currently in train.


The translation detail will be supported by a Toolkit and Implementation Plan to guide councils during the transition process as well as a Community Guide explaining for communities the reform of employment zones. The Implementation Plan is being updated to reflect the postponed local government elections.


Once the translation detail has been agreed upon between councils and the department, councils will need to seek their council’s endorsement of draft LEP amendments for public exhibition. The exhibition will occur first quarter of 2022.


The LEP detail will be publicly exhibited and councils, following the feedback from their stakeholders and communities, will be asked to review and endorse any draft amendments to local environmental plans before the amendment of individual LEPs are finalised second quarter of 2022.


The department will continue to work closely with councils during the implementation phase to support translation and minimise disruption as LEPs are brought across into the new framework.


If any issues arise during implementation, the department will make housekeeping amendments to the Standard Instrument - Principal Local Environmental Plan to support translation.


More information

If you would like additional information on the employment zone reform please email the Employment Zones project team.


The employment zones reform work will inform and align to the work the department is doing to prepare draft Employment Land Strategy Guidelines to assist councils in preparing Employment Land Strategies as part of their local strategic planning framework. For information on Employment Lands Strategies and Guidelines please visit our Employment Lands Strategies webpage.


The Greater Sydney Commission (GSC) is also undertaking a review of the policy setting for industrial land. The outcomes of that review will inform strategic planning for industrial land. The proposed employment zones will provide a statutory framework to give effect to that strategic planning. For more information on this work please visit the GSC Industrial Lands Policy webpage.



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Page last updated: 16/09/2021