Commission resolves if 'Letter of Call' is an employment contract
The Fair Work Commission (FWC) recently dealt with a case involving a minister of religion who argued he was unfairly dismissed by their church.
In its defence, the church argued that the minister was not their employee. Hence, the Commission first needed to determine whether the minister was bound by an employment relationship with the church.
‘Minister of the Word’
According to the FWC, the reverend accepted a call to the placement as a Minister on 16 May 2013, which commenced on 1 July 2013.
The minister believed that he was in an employment relationship with the church primarily because he was given a ‘monthly pay slip,’ not a ‘stipend slip’ which clearly states the number of hours ministers are being paid.
He also said that he has other allowances as part of his salary package other than a “stipend.” “My housing allowance and car allowance are not labelled as part of my ‘stipend’, i.e.living allowance,” the minister argued.
He also described the employer’s submission that the services being provided are “religious and spiritual,” as “illogical” because it suggested that a minister’s calling is exercised in the ‘heavenly’ realm.
“Our inner ‘faith’ interpreted as ‘covenantal’ and ‘spiritual’ in nature, is always lived out in real and practical terms, i.e. visitations, pastoral care, counselling, teaching, preaching, cleaning, serving in the op shop etc., etc.,” the worker argued.
“The Service that I am employed for is always ‘practical’ in nature, though the motivation is ‘internal’,” he added.
Despite such claims, the employer said that the minister held a covenantal and spiritual position as a Minister of the Word rather than an employment relationship with the church.
“Although ministry agents may describe the [church], or their congregation or other responsible body, as their ‘employer’, their ministry is not a form of employment,” the church stated in its submission. “It is grounded in a call from God to ministry, confirmed by the church.”
The employer also submitted that the worker’s “Letter of Call” and “Terms of Placement and Acceptance” represented the terms of his engagement.
In the said letter, it was explicitly stated in paragraph 13 that, “This document represents the placement arrangement approved by the Presbytery and is not an employment relationship.”
Further, the employer argued that the stipend was evidence of the covenantal relationship, and that the stipend was a “living allowance paid to the minister as they exercise their needs rather than a salary.”
FWC’s decision
Ultimately, the Commission said in its decision that it was satisfied that the minister was not an employee of the church. Hence, he was not protected from unfair dismissal.
The FWC also said that if, otherwise, the minister was determined to have been an employee, a valid reason existed for his dismissal, specifically that the minister publicly departed from and significantly recanted the teachings of the church.
Meanwhile, the Letter of Call that formed the relationship between the minister and the church cannot be interpreted as an employment contract, the Commission noted.
“It leads to the conclusion that the Letter of Call cannot be considered an employment contract, due to its explicit wording,” the FWC stated.
“The Letter of Call sets out that the church would pay the stipend to [minister], not as ‘consideration’ in a contractual sense or remuneration in relation to wages, but instead as a living allowance,” it also noted.
