The Queensland Government has proposed moving about 380,000 small business workers covered by federal awards back to the state.
The previous Labor government referred small business industrial matters to the Commonwealth three years ago.
But Queensland Attorney-General Jarrod Bleijie says many business operators complain the federal Fair Work Act is too complex, particularly in regard to workplace flexibility and productivity.
The State Government will today release an issues paper highlighting those concerns.
Mr Bleijie says it will discuss whether the legislation is best managed by the Commonwealth or the State.
"It's about making sure that businesses can open and workers have a job," he said.
"At the moment a lot of small businesses don't open on the weekend because of the complexities of the system and the cost." The Australian Council of Trade Unions (ACTU) says workers will be worse off under a state award.
ACTU president Ged Kearney says it is a power grab by the Queensland Government and workers will be vulnerable to losing pay and conditions.
John Battams from the Queensland Council of Unions says workers in the retail, hospitality and fast food industries will be worse off under a state award.
"They would stand to lose in the restaurant trade $25 on a Saturday and $50 on a Sunday," he said.
"They can ill-afford such a loss." Unions will make a submission opposing any award transfer.