Australia: The current state of play in the Israel Folau case

Last Updated: 30 June 2019
Article by Michael Byrnes

What proceedings has Israel Folau initiated?

It has been widely reported that Israel Folau has commenced proceedings with the Fair Work Commission (FWC) alleging a breach of section 772 of the Fair Work Act (Act) for unlawful termination of his employment with Rugby Australia (RA) on the grounds of religion. Unlike court pleadings, and consistent with the FWC approach in such matters, the application is not available to the media or public.

Some reports have also referred to the proceedings including a claim for breach of contract.

While a claim for breach of contract will almost certainly be a feature of the case if it proceeds beyond the FWC, the source of the jurisdiction of the FWC is the Act and it is unable to entertain such claims (although an examination of contractual terms may be relevant in any consideration of a breach of the Act).

How will the FWC deal with the proceedings?

The role of the FWC is confined to conciliating (mediating) the matter. It will not conduct a hearing or make any substantive orders in the current proceedings.

The conciliation process before the FWC is a mandated step before commencing proceedings in the Federal Court in which unlawful termination is pleaded.

It might come as a surprise to those unfamiliar with the process that the usual practice of the FWC for matters involving termination is for there to be, at least initially, a telephone conciliation using one of the FWC staff conciliators. This approach is ordinarily adopted even when the case involves high profile individuals or has garnered significant media attention. (Presumably consistent with the view that the processes of justice should be blind to such considerations.)

That said, if the matter does not settle at the telephone conciliation there may be an opportunity for a face-to-face conciliation before a member of the FWC.

What are the steps after the FWC?

If the matter does not resolve before the FWC then it will issue a certificate to that effect and the matter can then proceed, at the election of Folau, to the next stage, which Folau has foreshadowed will be the Federal Court.

After a determination by the Federal Court there is then the possibility of appeal to the Full Court of the Federal Court (comprising three judges) and then the High Court of Australia.

Before the High Court considers the merits of the matter in a substantive manner the party appealing the decision below needs to be granted special leave by the court.

The fact the case is a talking point among many Australians and is the subject of saturation coverage in the media does not, of itself, mean the High Court will grant such leave. The fact it is of interest to the public does not make it a matter of ?"public importance" for the purpose of the special leave application.

Will the case cost $3 million?

The (now defunct) GoFundMe and subsequent Australian Christian Lobby (ACL) crowdfunding pages set a goal for legal costs for the case of $3 million.

There is, as far as I can determine, no specifics provided of how this estimate of costs was arrived at nor any reference to any estimate provided by any lawyers acting for Folau to him or for the purpose of the crowdfunding exercise.

To give some perspective, on the ACL crowdfunding page, reference is made to Folau's actual legal costs for the relatively extensive RA internal process (which included a multi-day hearing before a RA panel consisting of two senior counsel with extensive experience in employment law and a sports administrator) as being $100,000.

Estimating legal costs is, given the vagaries of litigation, an inexact science even when a lawyer has extensive information and instructions about a case, let alone when trying to estimate likely costs from the relatively limited matters in the public domain. With that qualification in mind it is, however, difficult to conceive of how a case of this type could, even going all the way to the High Court, ultimately cost as much as $3 million or close to it. Various lawyers have publicly come forward to opine that the likely cost of the case is substantially lower than that amount. I agree with that assessment.

Is the Folau case a good "test case"?

At the time of writing, the crowdfunding efforts on behalf of Folau have raised in excess of $1.8 million. Setting aside the merits of the matter, there is no doubt the case has struck a chord with many in the Australian community.

A recurring theme of talkback radio calls and social media posts, from those who say they have donated, is that they are motivated by a concern that employers are overreaching when it comes to personal beliefs of employees and the expression of those beliefs, with Folau's situation constituting the start of a slippery slope and his case being an ideal way to put this issue before the courts for a definitive determination to protect the interests of all employees.

Concerns about employers unjustifiably encroaching on the private lives of employees has united people across the political and philosophical divide. Various legal commentators (including myself) have written about the risks of overreach from employers who might include contractual terms or promulgate and implement codes of conduct that purport to regulate out of hours employee conduct (including social media posts and other forms of expression) that has no or minimal nexus with the legitimate interests of the employer. The employer's prerogative to govern out of hours employee conduct has limits (as notably set out in the decision of Rose v Telstra Corporation Limited (1998) AIRC 1592).

The Folau case, however, is likely not going to be an ideal test case to determine the limits of the prerogative of employers to regulate the out of hours conduct of employees. Test cases are ideally the best example of a group to whom the ultimate finding will pertain, in this context being employees. Israel Folau was an atypical employee. As a public figure, it will be difficult for Folau to argue that his post was done in a "private" capacity, or that the post could have nothing to do with RA because it is something he did "off-duty". The nature of the duties associated with his role, which did not begin and end on the rugby field, means his case is different to the "average" or "normal" employee who would be in a stronger position to argue that their personal conduct has no reasonably arguable connection with their employment.

A better test case to establish the parameters of an employer's prerogative to regulate an employee's private conduct is an employee who is never called upon to publicly represent their employer, can establish a clear demarcation between their private social media account and employment and has no broader obligation to maintain the reputation of their employer. A case involving such an employee who has their employment terminated for expressing views or beliefs would likely be more instructive in establishing the true limits of the relevant employer prerogative.

Ultimately, the case will likely turn on the very specific terms of Folau's contract and the RA Code of Conduct rather than any broader principle of religious freedom or freedom of speech.

While the Folau case is presently a matter of great interest to the media and many in the general public, it is likely to disappoint as a case of enduring legal significance which sets a precedent for all employees.

A worthwhile debate

The Folau case has been the catalyst for a very interesting and important public debate about the appropriate limits of an employer's prerogative to regulate the private lives of employees. The appropriate balance between the rights of employers and freedoms of employees will likely be a feature of robust discussion and employment law cases for some time to come.

For further information please contact:

Michael Byrnes, Partner
Phone: +61 2 9233 5544
Email: mjb@swaab.com.au

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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