Sponsors may be liable for compo if Folau wins case

Companies that sponsor the ARU may have to pay unlimited compensation to Israel Folau.

Israel Folau leaving the Fair Work Commission in Sydney. Picture: Jonathan Ng

Companies that sponsor the Australian Rugby Union could be required to pay unlimited compensation to Israel Folau if they are found to be accessories to any breach by Rugby Australia of his rights under the Fair Work Act.

Sponsors could also be hit with civil penalties of up to $50,000 to $60,0000 even if their involvement amounted only to indirectly inducing Rugby Australia to wrongfully terminate his $4 million contract.

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Workplace lawyers said if Rugby Australia was found to have breached Folau’s workplace rights, sponsors who were involved in the affair could face the same claim that now confronts Rugby Australia.

Folau’s lawyers have lodged a claim with the Fair Work Commission arguing the termination of his $4m contract breached section 772 of the Fair Work Act, which deems it unlawful to terminate employment on the grounds of religion.

Folau is seeking $10m in ­compensation.

Michael Harmer of Harmers Workplace Lawyers said it would now be good tactics for Folau’s legal team to target any accessories. It could mean those who might have imposed pressure for his dismissal would be likely to impose pressure for a settlement.

“If you can pull some of them in, so they are in the melting pot, you would think pressure to get the thing fixed would come from the same sponsors,” Mr Harmer said.

“It would be wise to have a crack at some of the sponsors, particularly Qantas.”

Israel Folau and his wife Maria at church on Sunday in Kenthurst, Sydney. Picture: Jane Dempster

Rugby Australia terminated Folau’s contract after he said on social media that hell awaited “drunks, homosexuals, adulterers, liars, fornicators, thieves, atheists and idolaters” if they failed to repent.

Alan Joyce, who is chief executive of Qantas, a major ARU sponsor, said on June 16 in Brisbane that Folau’s comment was “clearly inappropriate” and it was up to the Rugby Australia to fix it:

“We said we expect them to do that and we’re happy with how Rugby Australia is progressing this,” Mr Joyce said.

On June 19, Mr Joyce said it was “outrageous” to suggest that Qantas was responsible for the termination of Folau’s contract.

Workplace lawyer Steven Amendola of K&L Gates said that under the Fair Work Act, a sponsor who encouraged another party to breach the act was involved in that breach.

This comes soon after Sydney barrister Jeffrey Phillips SC said last week’s statements by Rugby Australia chairman Cameron Clyne meant there was a real possibility of proceedings against third parties for inducing Rugby Australia to terminate Folau’s contract.

Mr Amendola agreed with Mr Phillips’s analysis but said it would be easier to pursue accessories under the Fair Work Act because it would only be necessary to show they were “involved” if a court finds Folau’s workplace rights were breached.

Under section 550(2) of the Fair Work Act, sponsors would be liable if they conspired with others to breach Folau’s rights, or had been knowingly concerned in a breach “in any way, by act or omission, directly or indirectly”.

Mr Clyne said last week it was “absolute nonsense” to suggest that Folau had been sacked at the behest of a sponsor.

However, he also said the alternative to dismissing Folau would have meant the ARU would have had no sponsors “because no sponsor has indicated they would be willing to be associated with social media posts of that sort, and that includes government, because we’ve also heard from them”.