Monique Ryan’s chief of staff will retain her job as she enters mediation with the federal Teal MP to resolve an unfair dismissal dispute.

Sally Rugg called for an urgent hearing on Friday to keep her job after she filed a suit against Dr Ryan and the Commonwealth over claims she was sacked for refusing to work unreasonable hours.

Ms Rugg has alleged the Commonwealth injured her in her employment by engaging “in hostile conduct in the workplace” and named Dr Ryan as a “principal actor” in the suit, court documents stated.

In an originating application, Ms Rugg said her employment was due to end on January 31, and she was seeking an injunction from the Federal Court to prevent her employment from being terminated.

Dr Ryan attended the interlocutory hearing in Melbourne, while Ms Rugg watched by video link from her lawyers’ offices.

Following last-minute negotiations, Ms Rugg’s barrister Angel Aleksov told the court the parties had agreed to allow his client to retain her job for the next two weeks.

“The parties have presented an agreed position and parties will go to mediation,” he said.

Commonwealth barrister Nick Harrington read out an undertaking to the court, stating that his client would keep Ms Rugg in her role until 5pm on February 17.

He said the Commonwealth would pay Ms Rugg for “miscellaneous leave”, which falls under the political staffer’s enterprise agreement.

Dr Ryan’s barrister Matthew Minucci said the MP agreed with the Commonwealth’s position, but flagged she might not be able to attend mediation in person as federal parliament resumes sitting next week.

Mr Harrington said the Commonwealth wanted to mediate on all matters, including the unfair dismissal claim, over the next fortnight.

Justice Debra Mortimer praised the parties for taking a “sensible approach” and ordered for the proceedings to be referred to a judicial registrar for mediation at a date to be fixed.

Outside court, Maurice Blackburn Lawyers principal Josh Bornstein, who is representing Ms Rugg, said she was pleased with Friday’s outcome.

“The issues at the core of Ms Rugg’s substantive complaints are deeply important to her,” he wrote in a statement.

“She notes that the 2021 Human Rights Commission’s inquiry into Commonwealth workplaces and the subsequent Set The Standard report demonstrated that these issues are important to many staff across Commonwealth offices of the federal parliament.”

Dr Ryan said: “I won’t be commenting on this today.”

She hired Ms Rugg, the former Change.org head, last year following her successful challenge to then-treasurer Josh Frydenberg’s seat of Kooyong in the federal election.

Ms Rugg has alleged Dr Ryan and Commonwealth breached national employment standards and workplace agreements by sacking her for refusing to work unreasonable hours.

She is seeking compensation and pecuniary penalties from all parties.

The matter will return on court on February 17.

– AAP