The reforms will extend the ban to contracts where the guaranteed weekly income is on or below the lower earnings limit of £123 a week.
The use of exclusivity clauses was first banned from zero hours contracts in 2015.
The changes could affect an estimated 1.5 million workers across the UK, who will now have greater flexibility over their working life.
It may also give low income workers the chance to re-skill and apply for jobs in different labour markets, as well as widening the talent pool for employers.
More on the cost of living:
Wage stagnation threatens wellbeing of low-paid workers
Low-income workers relying on Universal Credit rise to 1.3 million
High earners prioritised for cost of living pay rises
Matt Jenkin, employment partner at law firm Moorcrofts, said that the recent changes were overdue.
Speaking to HR magazine, he said: “The government’s decision to extend the ban on exclusivity clauses, which prevent employees working for multiple employers, to low paid workers has been long in the making.
"Employers who do have exclusivity clauses in their contract of employment will need to check if there are any employees that the ban applies to and adjust the contract of employment accordingly."
Kate Shoesmith, deputy CEO of the Recruitment and Employment Confederation (REC), added: “Given the current state of the economy, widening the ban on exclusivity clauses is a good move to support the lowest earners in the UK afford the rising cost of living.
"Banning low-paid workers from having multiple jobs makes no sense in a market where there are several industries facing shortages for labour."
The extension of the ban is bittersweet, Jenkin added, due to the slow pace of employment reform in the country, including the absence of the Employment Bill from the Queen's Speech.
Jenkin continued: "That bill, which would have seen significant increased protection for workers such as extending protection against pregnancy and maternity discrimination, does appear to be missing in action. The extension of the exclusivity ban is unlikely to stop the clamour for further employment law reform.”
