Hozack v The Church of Jesus Christ of Latter-Day [1997] FCA 1300

FEDERAL COURT OF AUSTRALIA

INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - employee a member of a church which was also her employer - condition of employment that employee remain "Temple-worthy" - employee "disfellowshipped" from Church - whether breach of condition of employment - whether termination was "in good faith in order to avoid injury to the religious susceptibilities of adherents of [the Church]" - whether Church had a VALID REASON to terminate the employment - effect of s 170DF(3) on the operation of s 170DE(1) - meaning of "OPERATIONAL REQUIREMENT" - meaning of "CAPACITY" Commonwealth Constitution, s 116 Workplace Relations Act 1996 (Cth), s 170DC, s 170DE(1), s 170DF(1), s 170DF(3) Church of the New Faith v Commissioner for Pay-Roll Tax (Vic) (1983) 154 CLR 120, followed KERRY ANNE HOZACK v CHURCH OF JESUS CHRIST OF LATTER-DAY SAINTS NI 1303 of 1996 MADGWICK J SYDNEY 27 NOVEMBER 1997

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NI 1303 of 1996

BETWEEN: Kerry Anne Hozack

Applicant

AND: CHURCH of Jesus Christ of Latter-Day Saints

Respondent

JUDGE(S): MADGWICK J

DATE: 27 NOVEMBER 1997

PLACE: SYDNEY

REASONS FOR JUDGMENT HIS HONOUR: This is an application pursuant to s 170EA of the Workplace Relations Act 1996 (Cth) ("the Act") in which the applicant, Ms Hozack, claims that the respondent ("the Church") unlawfully terminated her employment in contravention of ss 170DC, 170DE(1) and 170DF(1) of the Act. The applicant, who is also a member of the Church, was employed on 14 October 1993 as a part-time receptionist, apparently at the main desk in the Church's "Pacific Area" office, from which (among other things) the affairs of the Church in Australia are administered. There is no dispute that Ms Hozack was a competent employee, and had been commended by the Church for her standard of work. However, it was expressly stated to be a term of her employment that she "demonstrate [her] personal worthiness by fulfilling those conditions required to obtain a Temple recommend while so employed". A "Temple recommend" is a commendation issued annually to each eligible member of the Church to certify that he or she has lived by the Church's doctrines and is considered by the Church to be worthy to worship at the "sacred Temple". One is then considered to be "Temple-worthy". In early January 1996 it came to her bishop's attention that Ms Hozack was engaged in an intimate (including sexual) relationship with a man while she was separated from her husband but not divorced. The bishop visited Ms Hozack's home and told her that, if she did not cease the adulterous relationship, she would be excommunicated from the Church and would probably lose her job. He gave her three weeks to consider her options. On 21 January Ms Hozack was called to appear before the Church's Disciplinary Council, conducted by the bishop and two advisors. She explained that the relationship had ceased but, had she and her male friend still been together, she would not have terminated the relationship, regardless of the bishop's instructions. Her approach, in general, was that she was emotionally vulnerable and worried over her children's and her own welfare, and should have been allowed ample time to make an unpressured decision. As a result of that meeting Ms Hozack was "disfellowshipped" for a year. The consequence, under the Church's rules, was that during that period she no longer had the status of being "Temple-worthy". The applicant returned to work on 24 January and was called into the office of Mr Rundle, the Human Resources Manager. Mr Rundle told Ms Hozack that she was now required to commence work at 7:30am instead of 9:00am. This was a pretence. Mr Rundle intended giving Ms Hozack an opportunity to resign on the basis that she was unable to start work early because of her children. However, Mr Rundle very soon had a change of heart and told Ms Hozack squarely that, because she had been disfellowshipped, she had breached the condition of her employment that she be Temple-worthy. He gave her the option of resigning or being dismissed. When she refused to resign, Mr Rundle terminated her employment with immediate effect and handed her a cheque that had already been drawn for pay in lieu of two weeks' notice. A letter dated the same day was later forwarded to her, confirming that the reason why her services had been terminated was "breach of the conditions of employment . . . being that you have failed to comply with the Church Temple recommend standard of worthiness required by all employees". The letter went on to state that, as she had been a valued employee, the Church would be "most happy" to reconsider her for employment if the opportunity arose when she was again Temple-worthy.