The Employment Relations Authority has ordered an employer to pay over $218,000 after they were found to have exploited a migrant worker.

The employee moved to New Zealand from China to work for the employer, who promised to pay him $22 per hour. The employee was made to pay a “refundable deposit” of $16,563 to the employer, in return for the job. This money was never refunded to the employee.

After starting work, the employee signed an employment agreement which stipulated that he would work 40 hours per week at the rate of $22 per hour. This employment agreement was signed 6 months after the employee commenced work.

An investigation into the employee’s working hours revealed that the employee was actually working 60 hours a week, but only being paid for 40.

The employee resigned through text after the employer failed to pay a significant amount of his wages, and failed to return the deposit to him.

The Labour Inspector calculated that in the space of 19 months, the employee had been underpaid by $37,600.

As well as this, the employee had worked on numerous public holidays, but was not paid time and a half and didn’t receive any days in lieu. The employee received no holiday pay entitlements or sick leave entitlements, as no records were kept by the employer.

The Authority ordered the employer to pay over $65,000 to the employee for unpaid wages and holiday pay, and as compensation for the deposit that was never refunded. A penalty of $102,000 was imposed against the company, and a penalty of $51,000 was imposed against the employer directly.

If there is confusion about the minimum employment requirements, it pays to seek advice from a professional with experience in the area.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.

Alan Knowsley & Matthew Binnie

Litigation Team
Wellington