An unholy trinity? Religion, employees and the workplace

Australia is, by and large, a secular country. Australians have a constitutionally-entrenched freedom of religion, and anti-discrimination laws prohibit discrimination based on religion in a range of spheres. Yet as the furore surrounding the marriage equality survey demonstrated, religious issues sometimes intrude into the workplace. Companies large and small took vocal positions for and against marriage equality; in September a contractor in Canberra was terminated for expressing her religiously-motivated intention to vote no.

The intersection between religion and employment is vexed. Drawing the boundaries between private and public life, determining reasonable concessions for religious observance in the workplace and exempting religious organisations from general law require delicate judicial and legislative policy judgments. This topic is also inevitably a controversial one. What to an atheist might represent a reasonable compromise between religion and employment would likely be entirely different for a devoutly religious person.

Religion and the contract of employment

Religion has tended to intrude on the contract of employment in two distinct contexts. Firstly, spiritual motives may prevent a contract existing due to the absence of an intention to create legal relations. Alternatively, where a contract is on foot, religious law may be incorporated within that relationship.

 Intention to create legal relations

The mutual intention to create legal relations is an essential requirement in the formation of a contract (Australian Woollen Mills Pty Ltd v Commonwealth (1954) 92 CLR 424, 457). Traditionally, it was considered that family, religious and community settings gave rise to a presumption against the existence of such intentions.

The Australian position was altered in the seminal case of Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95 (‘Ermogenous’) in which the High Court highlighted the dangers of such presumptions. The Court held that the proper inquiry requires an ‘objective assessment of the state of affairs between the parties’ (at 105). Accordingly, ‘to say that a minister of religion serves God and those to whom he or she ministers may be right, but that is a description of the minister’s spiritual duties. It leaves open the possibility that the minister has been engaged to do this under a contract of employment’ (at 110).

Of course, Ermogenous did not say that a religious worker necessarily has a contract of employment with the relevant religious organisation. While in that case the question was remitted to a lower court, which upheld the existence of a valid contract (2002) 223 LSJS 459), subsequent judgments have retained the view that typically no legal relationship arises in the religious context. In Redeemer Baptist School Ltd v Glossop [2006] NSWSC 1201, for example, the Supreme Court of NSW held that teachers at a particular religious school provided their services ‘as volunteers in response to a calling to serve  God’ (at [59]).

As these varied outcomes demonstrate, whether or not an intention to create legal relations exists will be a fact-dependent inquiry. In some religious contexts, the manner of appointment and on- going relationship will support the existence of an enforceable agreement; in others it will remain in the realm of a ‘consensual compact … based on religious, spiritual and mystical ideas’ (Scandrett v Dowling (1992) 27 NSWLR 483, 513).

Continue Reading.

Written by John Wilson, managing legal director at Bradley Allen Love Lawyers and an accredited specialist in industrial relations and employment law, and Kieran Pender. First published in the Law Society Journal.