The Corrections Association says any privatisation of prisons would add to the number of guards leaving New Zealand to work in Australian jails.
By passing the Corrections Bill this week, Parliament has cleared the way for the private sector to run prisons.
Corrections Association president Beven Hanlon says prison managers in Western Australia are planning a recruitment drive in this country early next year.
He says guards working in private prisons in Australia earn more than they can in New Zealand.
Mr Hanlon says he has been fielding calls from prison guards worried about possible redundancies.
On Saturday, the Corrections Association is holding a protest in Kaikohe about the possible privatisation of Northland's Ngawha prison.