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Class action risk 2026
Class action risk 2026

Introduction

Consumer claims dip, while employee claims gain pace

Class action filings increased slightly in 2025, although the overall risk environment remains largely unchanged to recent years. Consumer claims, which have accounted for the largest proportion of filings for a number of years, have softened while employee class actions have surged to account for the majority of new claims. In this report, we take stock of the current state of the market, including a number of developments that are poised to shape how class action risk may evolve over the year ahead.

Key trends

Early flurry, slower finish: the year began at a record pace, with 36 class actions filed prior to 30 June 2025. However, the late-year filing rally we have become accustomed to over recent years did not materialise, with only seven class actions commenced across November and December 2025 (well down on the 19 claims filed over the final two months in 2024).
Rise in employment claims: 28 employment class actions were filed in 2025, representing 51% of total filings for the year (having accounted for approximately 15% of filings dating back to 2019). While the surge in filings is notable, employment class action risk has not necessarily altered given that 24 of these 28 class actions were accounted for by two distinct 'clusters' of very similar filings: the first involving 19 junior doctor underpayment claims filed on the same day, and the second being five claims filed in short succession against major retailers alleging underpayments and the failure to provide mandatory breaks.  
Muted consumer landscape: 11 consumer class actions were commenced in 2025, representing 20% of filings across the year. This is a noticeable drop-off from the elevated rate of consumer class actions over recent years, with consumer claims accounting for over 40% of annual filings in 2023 and 2024. While the dip in consumer claims is a noteworthy development, it is too early to suggest it is indicative of a shift in the risk environment. Given the ongoing regulatory scrutiny on cost-of-living pressures and trend of Australian class action filings in the wake of consumer claims offshore (particularly in the US), there are plenty of indications that consumer class actions may rebound over the year ahead.
Shareholder claims plateau: there were five shareholder class actions filed in 2025, in line with the handful of filings in 2024. These numbers suggest class action promoters are continuing to adopt a careful and circumspect approach to shareholder claims in light of the challenges associated with running them to trial. There are, however, a number of judgments set to be handed down over the year ahead that will likely have a bearing on the future state of risk in this space.
Competing class actions dry up: 2025 was another year of very few competing class actions, with the issue of multiplicity arising in only three claims, or 6% of filings across this year. This builds on the recent trend of plaintiff firms pursuing claims concerning a unique and broad base of subject matter with a view to avoiding the time, cost and risks associated with launching proceedings that may ultimately be stayed following the commencement of competing claims.

The High Court continues to weigh in: in recent years, the High Court has granted special leave in a number of class action proceedings. During 2025, the High Court delivered judgments concerning:

  • Common fund orders: following a number of years of uncertainty, the High Court confirmed the Federal Court has the power to make common fund orders, allowing litigation funders to extract a commission from funds paid to group members without the need to execute litigation funding agreements. While this decision was welcomed by funders, the High Court dealt a concurrent blow to plaintiff lawyers by unanimously determining that equivalent 'contingency fee' orders were not permitted to be paid to solicitors outside Victoria.1
  • Class closure orders: the High Court clarified that courts have the power to issue notices to group members establishing a class closure (or registration) process, ending the previous divide that existed between the Supreme Court of New South Wales and the Federal Court. This is a pleasing development that will allow the parties to class actions to mediate claims with certainty as to the size and composition of the class of group members on whose behalf a claim is advanced.

With special leave having already been granted in another class action early this year (relating to the assessment of damages in shareholder class actions), all signs point towards the High Court continuing to play a major role in shaping the class action landscape over the year ahead.

Footnotes

  1. In Victoria, plaintiff lawyers are entitled to extract their fees on the basis of 'group costs order'. A group costs order operates as a form of contingency fee arrangement, with the lawyer's fees extracted as a proportion of any damages obtained by group members.