NSW Department of Planning and Environment
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Employment zones reform

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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 vision for an area outlined with local and state strategic plans.

Small and medium sized business are the backbone to a productive economy. Employment zones guide and direct businesses to establish, grow and adapt.

The employment zones reform delivers a simplified framework that:

  • suits the future of work
  • is fit for purpose
  • supports productivity and jobs growth
  • delivers the community’s objectives set through strategic plans and planning priorities.

The reform of employment zones supports long-term economic recovery through job creation and encourages increased productivity in NSW

The employment zones provide clear strategic intent, include clarity around their application and increase flexibility around land uses.

Making it easier for business

In December 2021, the reform of the employment zones was finalised with the introduction of 5 new employment zones and 3 supporting zones into the Standard Instrument (Local Environmental Plans) Order 2006.

The department exhibited how business and industrial zones in Local Environmental Plans (LEP) across NSW are to be translated to employment zones.

The exhibition period ran from 31 May to 12 July 2022. Feedback from the exhibition has informed policy finalisation.

Employment zones commencement

The employment zones were introduced into 134 individual LEPs through six self-repealing SEPPs on 16 December 2022 but will not commence until 26 April 2023. Mapping for the employment zones is being delivered digitally via the planning portal, except where a council has elected to remain with PDF mapping.

The new employment zones are being implemented within local environmental plans in three packages over the next few months. These are as follows:

Amending SI LEP Order and prescribed zones SEPP

On 30 November 2022 the Standard Instrument (Local Environmental Plans) Amendment (Land Use Zones) Order 2022 (Amending Order) was made with immediate commencement. The Amending Order makes changes to support implementation roll out including amending the date of the repeal of the business and industrial zones to 26 April 2023.

Other changes include modifications to objectives and land uses to address matters that were raised in submissions, as well as savings and transitional provisions to facilitate the smooth transition to employment zones.

On 30 November 2022 State Environmental Planning Policy (Transport and Infrastructure) Amendment (Land Use Zones) 2022 (Prescribed Zones SEPP) was made with immediate commencement. The Prescribed Zones SEPP primarily amends the State Environmental Planning Policy (Transport and Infrastructure) 2021 and State Environmental Planning Policy (Housing) 2021 to include employment zones as prescribed zones to maintain permissibility under these SEPPs.

Six Land Use (self-repealing) SEPPs

On 16 December 2022, six self-repealing SEPPs were made amending 134 LEPs to introduce employment zones. These LEP amendments will commence on 26 April 2023.

For the remaining LEPs not captured as part of the six SEPPs, these will be amended either by a Consolidated/Comprehensive LEP process or through a future SEPP. Until those amendments are notified, these LEPs will be covered by a savings and transitional provision to maintain their business and industrial zones until their LEP is amended.

Housekeeping SEPP

In February 2023 a self-repealing (housekeeping) SEPP is intended to be made to finalise mapping to accommodate ongoing updates to the State cadastre and to capture minor consequential changes across various instruments.

 

Background to the employment zones framework

In May 2021, the department proposed that the existing Business (B) and Industrial (IN) zones be replaced with five employment zones and three supporting zones under Standard Instrument (Local Environmental Plans) Order 2006 (SI LEP Order).

The reform was finalised in December 2021 with the introduction into the SI LEP Order of 5 new employment zones and 3 supporting zones.

We developed and finalised the employment zones 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
  • better support councils in the delivery of the strategic vision contained in their Local Strategic Planning Statements and background studies.
 

Why the reform?

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 with a significant increase in 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 focused 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.
 

More information

For more information on the employment zone reform please:

Page last updated: 02/02/2023