FEDERAL COURT OF AUSTRALIA

Rogers v McDonald’s Australia Ltd (AI-use) [2026] FCA 1264

ORDERS

THE COURT ORDERS THAT:

Initial Trial

1.    The initial trial will determine the factual and legal issues substantially in accordance with Schedule 1 to these Orders.

Mediation

2.    The Honourable Michael Walton KC be appointed as Mediator.

3.    Pursuant to s 53A of the Federal Court of Australia Act 1976 (Cth), the whole of this proceeding is referred to mediation by the Mediator.

4.    The mediation ordered in Order 3 commence by a preliminary conference on a date to be agreed between the mediator and the parties as soon as practicable after 14 May 2027.

5.    The costs of the mediator and any venue fees are to be shared as to one half by the applicants together and as to the other half by the respondents together.

Affidavit

6.    By 13 November 2026, the solicitors for the franchisee respondents are to file and serve a supplementary affidavit providing an update on progress of matters addressed in the affidavit of Ms Cathryn Prowse of 24 August 2026.

Conferral

7.    By 6 November 2026, pursuant to s 37P(2) of the Federal Court of Australia Act 1976 (Cth), the parties are to:

(a)    confer, with the assistance of a suitably qualified technology experts selected by the parties, as to the suitability of using artificial intelligence (AI) technology in the preparation of the matter for mediation and trial including, without limitation, the parties conferring regarding the use of AI technology in:

(i)    collating and analysing quantification data for the purposes of mediation;

(ii)    preparing chronologies and summaries of primary documents, including be reference to specified issues; and

(iii)    managing and interpreting documents and other data that is relevant in the proceeding more generally,

(b)    produce a report and/or draft protocol to the Court as to the results of that conferral;

(c)    have reference, to the extent necessary, to the Federal Court of Australia, General Practice note - Use of Generative Artificial Intelligence Practice Note (GPN-AI), 16 April 2026, during that conferral.

Leave

8.    The applicants have leave to discontinue against the 14th Respondent, Arn-Tas Investments Pty Ltd.

Further Case Management Hearing

9.    The matter is listed for a further Case Management Hearing (Next CMH) on a date to be fixed by the Court, not before 7 December 2026.

10.    Within:

(a)    seven days prior of the Next CMH, the applicants deliver to each other party a draft joint position paper (JPP) succinctly stating their position in respect of each issue they propose be addressed at the Next CMH;

(b)    five days prior to the Next CMH, each other party deliver to all parties its contribution to the draft JPP, succinctly stating that party's position in respect of each issue it proposes be addressed at the Next CMH; and

(c)    three days prior to the Next CMH the applicants deliver the JPP to the Associate to his Honour Justice Lee.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Schedule 1

No. VID1028 of 2023

Federal Court of Australia

District Registry: Victoria

Division: Fair Work

SHOP, DISTRIBUTIVE AND ALLIED EMPLOYEES ASSOCIATION AND OTHERS

Applicants

MCDONALD’S AUSTRALIA LIMITED (ACN 008 496 928) AND OTHERS

Respondents

FACTUAL AND LEGAL ISSUES FOR DETERMINATION

In all parts of this document, words used that have a defined meaning in the Statement of Agreed Facts and Non-Contentious Issues dated 30 July 2026 (“SOAF”) have the meaning given to them in the SOAF.

The order in which the issues are listed below is not intended to determine the order in which the issues must be argued by the parties or decided by the Court.

A-1     Systems

1.    During the claim period, did the Employers:

a.    implement a system of rostering managers as alleged at FASOC [13];

b.    have a system concerning responsible shift managers as alleged at FASOC [14];

c.    have a system of assigning work to responsible shift managers as alleged at FASOC [15];

d.    have a system concerning pre-shift work as alleged at FASOC [16];

e.    have a system concerning handovers as alleged at FASOC [17];

f.    have a system concerning after-shift work as alleged at FASOC [18];

g.    have a system concerning clocking as alleged at FASOC [19]?

A-2     Practices

2.    In respect of each Sample Employee:

a.    during which shift(s) did they act in the role of responsible shift manager during the Agreement and/or Award periods?

b.    when, in respect of such shifts, did they become, and then cease to be, the responsible shift manager?

c.    did they perform pre-shift work before their rostered start time, and if so on which shift(s)?

d.    did they perform after-shift work after their rostered finish time, and if so on which shift(s)?

e.    if the answer to either or both of [2(c)] and [2(d)] is, in the case of a particular Sample Employee, “yes”:

i.    if and when that Sample Employee was paid according to clocked hours, did they perform that pre-shift work or after-shift work outside of clocked hours;

ii.    if and when that Sample Employee was paid according to rostered hours, did they perform that pre-shift work or after-shift work outside of rostered hours;

iii.    if and when that Sample Employee was paid a salary for working up to certain hours on certain days and times, did that pre-shift work or after-shift work have the effect that those hours were exceeded?

(work of the kind contemplated in 2(e)(i)–(iii) above, “outside of paid time”).

A-3     Record-keeping

3.    On the proper construction of ss 535 and 536 of the Fair Work Act 2009 (Cth), and of rr 3.33, 3.34, or 3.36 of the Fair Work Regulations 2009 (Cth), were Employers required to make and keep employee records, or provide payslips, in respect of:

a.    pre-shift work done prior to the rostered start time;

b.    after-shift work done after the rostered finish time?

4.    If the answer to the question in [3] is “yes”:

a.    did each Sample Employer keep such records or provide such payslips?

b.    if not for any Sample Employer, did it have a reasonable excuse for its non-compliance?

A-4    Requests, requirements, etc.

5.    Did each or any Sample Employer in respect of any Sample Employee employed by it, and in relation to:

a.    each system alleged in FASOC [16], [17], [18], and [19]; and/or

b.    each practice alleged in FASOC [16A], [18A], and [19A] do any of the following in relation to those systems and practices, and if so which:

c.    request compliance and conformity with them;

d.    require compliance and conformity with them;

e.    sanction compliance and conformity with them;

f.    direct compliance and conformity with them;

g.    expect compliance and conformity with them;

h.    authorise compliance and conformity with them;

i.    approve compliance and conformity with them;

j.    benefit from compliance and conformity with them;

k.    accept compliance and conformity with them;

l.    criticise non-compliance or non-conformity with them;

m.    counsel against non-compliance or non-conformity with them;

n.    discipline non-compliance or non-conformity with them;

o.    know of the Sample Employee conforming or complying with them.

6.    Having regard to the answer to [5], for any Sample Employee who performed pre-shift work or after-shift work outside of paid time, was the relevant Sample Employer obliged to pay the Sample Employee for that work under the Agreement or the Award as the case may be?

A-5    Contraventions

I.    Failure to provide entitlements for pre-shift work and after-shift work during the Agreement Period

7.    If the answer for a Sample Employee to [6] is “yes”, was that Sample Employee paid or provided with other benefits in accordance with Agreement entitlements?

II.    Failure to provide entitlements for pre-shift work and after-shift work during the Award Period

8.    If the answer for a Sample Employee to [6] is “yes”, was that Sample Employee paid or provided with other benefits in accordance with Award entitlements?

III.    Section 62 of the FW Act

9.    Did any Sample Employers request or require Sample Employees who were full time employees and classified as McDonald's Employee Level 4 under the Agreement to work more than 38 hours in a week by requesting or requiring them to perform pre-shift work and/or after-shift work during the Agreement period?

10.    If the answer [9] above is ‘yes’, were those additional hours reasonable or unreasonable within the meaning of s 62 of the FW Act?

IV.    Identification of primary contraventions

11.    In view of the answer to [7] above, did any Sample Employers contravene the Agreement and therefore s 50 of the FW Act, and, if so, in what way?

12.    In view of the answer to [8] above, did any Sample Employers contravene the Award and therefore s 45 of the FW Act, and, if so, in what way?

13.    In view of the answers to [9]–[10] above, did any Sample Employers contravene s 62 of the FW Act, and thereby s 44 of the FW Act, and, if so, in what way?

A-6    Compensation orders

I.    Compensation in the Agreement Period

14.    In respect of each Sample Employee, if the amount paid to them in respect of the Agreement period:

a.    exceeded the amount payable under the Agreement (assessed across the Agreement period, across a 12-month period, or across each pay period); or

b.    was less than the amount payable under the Agreement –

can the amount paid to them in respect of the Agreement period be brought to account in assessing compensable loss for the purposes of s 545 of the FW Act (and if so in what way)?

II.    Compensation in the Award Period

15.    In respect of each Sample Employee, if the amount paid to them in respect of the Award period:

a.    exceeded the amount payable under the Award (assessed across the Award period, across a 12-month period, or across each pay period); or

b.    was less than the amount payable under the Award –

can the amount paid to them in respect of the Award period be brought to account in assessing compensable loss for the purposes of s 545 of the FW Act (and if so in what way)?

A-7    Contravention of s 558B of the FW Act

16.    During the claim period, did MAL have a significant degree of influence or control over the affairs of franchisee employers, such that it was a “responsible franchisor entity” with respect to those franchisee employers within the meaning of s 558A(2) of the FW Act?

17.    If “yes” to [16]:

a.    did such contraventions by Sample Franchisee Employers as are found to have occurred occur in the Franchisee Sample Employers’ capacity as a franchisee entity, within the meaning of s 558B(1)(c) of the FW Act?

b.    did MAL know or could it reasonably be expected to have known that the Sample Franchisee Employer’s contraventions would occur, or a contravention of the same or a similar character was likely to occur?

c.    If the answer to (a) and (b) is “yes” – did MAL take reasonable steps to prevent contraventions by Sample Franchisee Employers of the same or a similar character within the meaning of s 558B(3) of the FW Act?

III.    Identification of s 558B contraventions

18.    In view of the answers to [16]–[17] above, did MAL contravene s 558B of the FW Act in relation to any Sample Franchisee Employer contraventions?

A-8    Serious contraventions

19.    If any Sample Employer contravened ss 45 and / or 50 of the FW Act, did the Sample Employer knowingly contravene the civil remedy provisions within the meaning of s 557A(1)(a) of the FW Act?

20.    If any Sample Employer contravened ss 45 and / or 50 of the FW Act, did the Sample Employer expressly, tacitly or impliedly authorise the contraventions within the meaning of s 557B of the FW Act?

21.    If any Sample Employer contravened ss 45 and / or 50 of the FW Act, was the conduct constituting the contraventions part of a systematic pattern of conduct within the meaning of s 557A(1)(b) of the FW Act?

22.    If any Sample Employer contravened ss 45 and / or 50 of the FW Act, were the contraventions serious contraventions by the Sample Employer within the meaning of s 557A of the FW Act?

A-9     Relief

23.    Did any Sample Employee suffer loss or damage, and if so:

a.    should compensation be ordered under s 545 of the FW Act, and if so in what amount and by whom;

b.    should interest be ordered under s 547 of the FW Act, and if so in what amount and by whom?

REASONS FOR JUDGMENT

(Delivered ex tempore, revised from the transcript)

LEE J:

A    INTRODUCTION

1    On 16 April 2026, the Court published its Use of Generative Artificial Intelligence Practice Note (GPN-AI). Among other things, the Practice Note records that this Court embraces the beneficial use of technology in proceedings and in its wider operations and recognises that generative artificial intelligence has the potential to further the overarching purpose of the civil practice and procedure provisions by increasing efficiency in the conduct of litigation and reducing legal costs.

2    To develop a related theme, a few days ago, I had the occasion of delivering the Sixteenth Sir Harry Gibbs Memorial Oration. In my speech All the Right Notes: Artificial Intelligence and the Future of the Common Law, I suggested that the real opportunity presented by artificial intelligence is considerably more interesting than whether a machine can draft a competent submission or find a case more quickly. It allows us to reconsider entrenched processes which developed in a world constrained by the capacity of human beings to collect, collate and synthesise information. Those constraints are disappearing rapidly and there is no reason to assume that procedures which developed in response to them possess some immutable virtue.

3    I also suggested that our lodestar should be the use of artificial intelligence to implement reforms which allow lawyers to spend more time exercising professional judgment and judges to spend more time identifying what really matters and deciding it according to law. That proposition has a very practical connexion with the overarching purpose. The just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible is not furthered by requiring highly skilled solicitors, or armies of persons working under their supervision, to spend enormous amounts of time performing mechanical tasks of collection and synthesis if technology can perform those tasks reliably and at a fraction of the cost.

4    This proceeding provides an obvious occasion to consider whether that can be done. It is a class action of great complexity concerning alleged failures to pay managers employed at corporate-owned and franchisee-owned McDonald’s restaurants for work said to have been performed before rostered starting times or after rostered finishing times. The proceeding has been fixed for a ten-week initial trial commencing in early 2028. I have engaged a facilitator to work with the parties in identifying the principal legal and factual issues requiring determination and in developing an agreed statement of facts. With the cooperation of the parties, considerable progress has been made. The issues for determination have been identified and the process of conferral as to agreed facts continues.

5    Orders to be made today also provide for the appointment of a mediator and for a preliminary conference in May next year, after the exchange of evidence and discovery. A critical aspect of preparing for that process concerns the provision of quantification data. The information sought from McDonald’s forms Annexure A to these reasons and information sought from the franchisee respondents is reproduced as Annexure B. Much of that material will be provided by agreement, although some matters remain contentious (including category 4 of Annexure B).

6    One does not need to form any view about the merits of the claims, or about the attitude any respondent ought to take to settlement, to recognise the practical problem. If there is to be a meaningful attempt at non-curial resolution, the applicants require a sufficient understanding of such matters as the number and circumstances of the group members they represent, their positions and applicable classifications under awards or enterprise agreements, whether they were employed on a full-time, part-time or casual basis, the shifts disclosed by the available business records and relevant remuneration information. A mediation conducted without a reasonably reliable picture of matters of that kind would have little prospect of achieving its purpose.

7    But the difficulty, as presently appears, is not that the primary information does not exist. It is that the information is dispersed throughout a miscellany of business records, apparently maintained in different repositories and in different forms, and must somehow be collected, related to particular individuals and periods, analysed and synthesised before it becomes useful. The relevant task is to turn an enormous body of primary information into something intelligible enough to permit the parties, and ultimately the Court, to understand what it shows.

8    The problem of the collation and provision of information from contemporaneous primary records extends beyond the mediation process. As ordered on 24 April 2026, the present intention is for the initial trial to determine the claims of seven individuals involving their employment by seven respondents, including McDonald’s (subject to me being satisfied, after the opening of the case, that the resolution of this large number of claims in truly necessary at the initial trial).

9    The agreed facts and evidence filed thus far reveal what might fairly be described as a patchwork of information concerning the employment histories of those individuals at McDonald’s stores. Put at a high level, an important question will be whether there existed a general or bespoke system by which those persons performed work which was not captured by the relevant business records. It will therefore be necessary to understand, with some precision, what the business records do reveal before attention can sensibly turn to what they may fail to reveal.

10    This is precisely the sort of problem which requires some imagination in contemporary case management. I was told from the Bar table today that approaches adopted in earlier cases to the collation and presentation of primary records have involved what was described as “vast” expenditure. I am reluctant simply to reproduce such a process in this proceeding without first asking whether there is now a better way of doing it. The overarching purpose is not served by treating the historical cost of performing a task as though it were an unavoidable characteristic of the task itself.

11    The scale of modern litigation makes that inquiry increasingly important. Proceedings of this kind generate and depend upon quantities of primary information which no judge, lawyer or party could sensibly absorb in its undigested form. The administration of such a case therefore necessarily involves processes of organisation and synthesis. The question is whether those processes should continue to be undertaken substantially by traditional manual methods, at very considerable expense, when appropriately designed technology may be capable of performing at least some of the work more quickly and cheaply.

12    There is a further point. The obligation to further the overarching purpose requires more than exhortation. Courts have spoken for many years about proportionality, efficiency and the reduction of unnecessary cost. Those aspirations will achieve little if, when confronted with a new means of performing an old and expensive task, courts and parties simply reproduce familiar processes because they are familiar. Complex litigation will only become manageable if case management is prepared to be inventive about how vast quantities of information are reduced to the material which actually matters. That is especially so in a representative proceeding where the costs of unnecessary process may be multiplied.

13    None of this assumes that artificial intelligence provides the complete answer, still less that the Court should entrust to a machine any substantive adjudicative task. The distinction I sought to draw in the Sir Harry Gibbs Oration is important. The objective is to use technology to perform work which does not itself require human judgment, so that professional and judicial judgment can be concentrated upon the matters which do. Any technological process adopted in this proceeding would therefore have to preserve traceability to the primary records, permit its outputs to be tested and corrected (to some level), protect privileged and confidential material where necessary, and remain subject to appropriate human supervision.

14    I am not asking the parties to become software developers. Existing commercial artificial intelligence models and other technological tools are likely to provide a satisfactory solution. What I expect is that those advising the parties will obtain appropriate specialist assistance and approach the problem without assuming that the only permissible method is the one which would have been adopted five or ten years ago. The task is to identify whether there is a secure and reliable methodology by which the relevant universe of primary material can be collated and synthesised, with the source of any output remaining ascertainable, so as to produce information useful both for mediation and, if necessary, for the efficient conduct of the trial.

15    It is important to be clear about the nature of what I am presently directing. I am not prescribing the technology, selecting a provider or determining in advance the form of any eventual protocol. Those matters require expertise which the Court does not profess to possess and should be developed with the parties. What matters at this stage is that the use of AI in this case be examined seriously, cooperatively and with an eye to the overarching purpose, rather than dismissed because the conventional alternative is known.

16    Accordingly, pursuant to s 37P(2) of the Federal Court of Australia Act 1976 (Cth), I will direct the parties to confer, with the assistance of an agreed suitably qualified technology expert, and provide to my Chambers a proposed protocol addressing how the relevant primary information can be assembled, analysed and presented for the purposes of the mediation and, if necessary, the trial, as quickly, inexpensively and efficiently as the circumstances permit.

Associate:

Dated: 28 August 2026

Annexure A

Annexure B

SCHEDULE OF PARTIES