Folau case settles... but issues remain in play


Folau case settles... but issues remain in play

Israel Folau and Rugby Australia have agreed to settle their dispute before it was heard in court, leaving many significant workplace issues unresolved.

Former player Israel Folau and Rugby Australia have agreed to settle their dispute before it was heard in the Federal Circuit Court. The financial terms of the settlement are confidential, although subject to much speculation in the media.

Folau’s eventual claim was rumoured to be for $14 million, so the payout by Rugby Australia (RA) may have been several million dollars. It has been reported that RA will claim on an insurance policy for the amount.

Both parties issued apologies to each other for any distress or hurt caused by their actions to each other and to any other parties. Both also stated that they had never intended to cause hurt or distress to each other or anyone else.

While the settlement does end this matter, the dispute was going to be a very significant test case for a number of employment issues that could affect other employers. These issues will remain unresolved for now, and this article summarises what they are.

A brief history

Folau was a very high-profile rugby union player with a long history of promoting his religious views via social media. In 2017 and 2018, he posted various comments that some people regarded as homophobic, resulting in complaints to RA.

RA requires its players to comply with a code of conduct, and claimed that its scope included prohibiting players from publicly making comments that could be homophobic. It claimed that such comments could be harmful to other rugby players and members of the community, and could damage the reputation and financial position of RA and the image of the game of rugby. Whether the player’s conduct was intentional, and whether the player could reasonably have foreseen its consequences were also taken into account.

RA renewed Folau’s contract in 2018, after he allegedly promised to moderate his social media comments, but in April 2019 he posted more comments on Twitter. One said that a range of people – including homosexuals, drunks, liars, fornicators, thieves, atheists and idolaters – should repent now or go to hell. He and others have claimed that this was a paraphrased quote from the Bible. This post provoked widespread reaction.

Some major sponsors of RA withdrew their support. RA claimed that Folau had breached its code of conduct and terminated his contract. Folau then lodged a claim of unlawful termination of employment with the Fair Work Commission. The dispute then went to the Federal Circuit Court, which required the parties to attempt to mediate a settlement, otherwise the case would be heard in early 2020. Mediation was successful.

What each party claimed

Folau’s claim was based on sec 772 of the Fair Work Act 2009. He sought financial compensation for loss of the income he would have received if his playing contract had not been terminated. He claimed that his contract was unlawfully terminated because of his religion. He claimed that his social media posts were simply expressing the views of his religion, were near-direct quotes from the Bible, and there was no intention to offend or attack anyone in them. Further, the posts were not made in the course of his employment with RA, but made as a private citizen. Because they identified his religion, that was why RA terminated his contract.

RA’s defence was that when Folau breached its Code of Conduct it had a valid reason to terminate his contract.

What were the employment law issues?

Section 772 of the Fair Work Act states that it is unlawful to terminate someone’s employment for a list of reasons. “Religion” is one of the reasons. Note that it does not have to be the only reason for termination, it only needs to be one of the reasons.

Equal opportunity legislation states that treating people less favourably on the ground of their sexual orientation or lack of religious beliefs amounts to unlawful discrimination. Critics of Folau claimed that his posts could incite hatred and victimisation of the types of people he targeted.

What employment law issues remain unresolved due to this case being settled?

Had the case gone the distance, it would have had to answer the following significant questions:
  • Was the reason (or one of the reasons) for terminating the contract Folau’s religion or was the sole reason his alleged breach of his contract?
  • In the Fair Work Act, is “religion” confined to belonging to a religion and holding certain religious views, or does its scope extend to expressing those views in a controversial way? In other words, did Folau merely express his religious identity or did he cross a line?
  • Does sec 772 override the contents of an employment contract and a policy or code of conduct included in that contract? Did RA’s use of the latter documents amount to an attempt to “contract out” of its obligations under sec 772? 
  • How would a “reasonable person” interpret the content and intent of Folau’s social media posts? Whether such a person would be offended, humiliated or intimidated by them is a test frequently used to decide sexual or racial harassment cases. Community debate of this case suggested that there were many “reasonable people” with strong opinions on both sides.Cases involving dismissal for social media (mis)use have so far been decided on their individual facts, but it can generally be said that tribunals and courts take the following into account:
  • Did the employer have a binding policy setting out rules for the use of social media by employees? Was it clearly explained to the employee and did the employee agree to it?
  • Did the social media posts have the potential to be offensive, harassing, intimidating, threatening, defamatory, or a risk to the safety and welfare of others?
  • Did the posts clearly identify the employer?
  • Did they have the capacity to harm the reputation and/or business viability of the employer?
Given all the above, were the posts made in connection with the employee’s employment? The Folau case was unique because of his very high public profile, which meant it was more likely that people might associate his posts with his employer (RA). Also, the stakes were very high for both parties. Arguably if a “low profile” employee had posted similar comments on his/her private social media account, and the posts did not identify the employer, it is unlikely the employer could claim the posts had caused enough damage to amount to misconduct. But because the Folau case was not decided in court, it is not possible to state whether an employer can issue and rely on a policy that prohibits an employee from making potentially harmful comments anonymously on a private social media account.

A previous article covered the issues that employers would have to deal with if one of their employees did something similar to Folau.

Religious Discrimination Bill not to be introduced in 2019

The federal government has said that it will not introduce its proposed Religious Discrimination Bill into Parliament this year. It circulated a draft bill in Australia September 2019, which has been criticised by both the groups that lobbied for a bill (because it doesn’t go far enough for them) and those who oppose one.

Provisions of the draft bill are covered in a previous article.  Access the draft bill here.
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