Restaurant owners fined for migrant worker exploitation

Staff Reporter

Staff Reporter

Auckland, September 25, 2020

                            

                                                            (Photo by Shreyak Singh on Unsplash)

An Auckland restaurant and its owners have been ordered by the Employment Relations Authority (ERA) to pay nearly $50,000 in penalties and unpaid wage arrears to a migrant worker.

Dansan Investments Limited, which operates as Saaj Indian Cuisine in Auckland, and its two directors, Mary George Varghese and Sheik Abdul Kader are also personally liable for this sum.

Along with $32,000 owed in wage arrears, one third of the $16,100 in penalties is to be paid directly to the exploited worker.

Premium for Work Visa

Following a Labour Inspectorate investigation into Dansan Investments Limited, the Court heard how the worker was told to make a $6000 premium payment to the employers to secure an application for her work visa.

The worker had to borrow money from friends to pay the employers, under the threat that the application for a work visa would not be supported if the employee did not make the payment.

“This is yet another example of an employer using their position of power to exploit a migrant worker, who relies on them for a work visa and their right to continue to live and work in New Zealand,” Labour Inspectorate National Manager Stu Lumsden said.

He said that migrants to New Zealand should never have to pay a ‘premium’ or any sort of extra cost to secure a work visa from their employers. For employers to demand such a payment is illegal. “To exploit migrant workers is completely unacceptable, and the Labour Inspectorate will take full compliance action against employers who do this. The ERA also made it very clear that this type of offending will not be tolerated by the Authority,” Mr Lumsden said.

Overworked, underpaid

The employment agreement showed that the worker would work a minimum of 35 hours a week, and although she consistently worked between 40 and 65.5 hours a week, she was only paid for between 28 and 33 hours a week. The employers also did not make any holiday payments and did not pay time and a half for work completed on public holidays.

“Dansan also had no clear wage records. This required the investigation to source alternative proof, in this case the use of public transport travel records, to disprove Dansan’s claim that she did not work at the restaurant during those times,” Mr Lumsden said.

Previous offences

This is not the first time that Dansan Investments Limited has been investigated by the Labour Inspectorate. A former employee complaining in 2015 for failure to pay minimum entitlements saw an Improvement Notice issued by the Inspectorate, which was not adhered to by Dansan.

MBIE encourages anyone concerned about the employment situation for themselves or someone they know to call its contact centre on 0800-209020, where their concerns will be handled in a safe environment.

Source: Ministry of Business, Innovation & Employment

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