Israel Folau's unfair dismissal case against Rugby Australia and the New South Wales Waratahs will head to trial in February, if no settlement can be reached beforehand.
Fundamentalist Christian Folau is fighting the termination of his four-year contract in May after he posted a meme on social media that said hell awaited 'drunks, homosexuals, adulterers' and other groups.
A Federal Circuit Court judge in Melbourne has encouraged the parties to settle their dispute at a mediation hearing on 13 December.
Should mediation fail, the case would proceed to trial on 4 February.
Folau, who has cast the legal challenge as a fight for religious freedom, is seeking an apology from Rugby Australia, the right to resume his international career and up to $12 million in compensation.
"It's been publicly acknowledged by Israel and his team that he still seeks that apology and that's still very important to him," Folau's solicitor George Haros told reporters after the hearing.
"That would come a long way to resolving the dispute."
The 30-year-old raised more than $2m in public donations for his legal fight with the backing of a local Christian lobby.
Folau scored 37 tries in 73 tests for the Wallabies and was expected to play a key role in the Rugby World Cup starting in Japan next month.
He did not appear at Tuesday's hearing.
"He's going very well. His conviction is amazing. He's a strong man," Haros said.