Migrant workers were 'ruthlessly exploited' for employer's personal gain, Labour Inspectorate says
An Auckland restaurant and its sole director have been ordered to pay around $377,000 for "ruthlessly" exploiting seven migrant workers it employed.
The Employment Relations Authority (ERA) ordered The Indian Taste Limited to pay $199,529 in wage arrears to its employees, while its former director Krishna Khandelwal was ordered to pay penalties of $177,300.
ERA member Matthew Piper issued the order after hearing that the employer breached employment standards by making the migrant workers work between 60 and 90 hours per week, but only paying them for around 30 hours.
The migrant workers were also required to work for one to two weeks unpaid when they first started. Among the employment breaches identified by the ERA include:
- Failing to pay the minimum wage.
- Making unlawful deductions from wages.
- Failing to pay annual holiday and alternative holiday entitlements.
- Requiring workers to pay premiums to secure employment.
- Failing to keep accurate wage and leave records.
"Multiple employment standards were breached and this is not a case where it would be appropriate for the Authority to exercise a discretion not to impose penalties despite breaches having occurred," Piper said in the ruling.
"Mr Khandelwal was in control of the actions of The Indian Taste during the relevant period and engaged in deliberate and exploitative behaviours which adversely affected multiple migrant workers.
"As the shareholder of The Indian Taste, Mr Khandelwal received a financial benefit for his actions by underpaying workers and in doing so also failed to compete fairly with other businesses providing similar products and who complied with the law."
'Egregious case of migrant exploitation'
The penalties come after a nine-month-long investigation by the Labour Inspectorate into the employment breaches.
Sam Mills, Labour Inspectorate Migrant Exploitation Manager, said the inspectorate received multiple complaints of the breaches between March and December 2024.
"This was an egregious case of migrant exploitation where vulnerable workers – many with limited English and little understanding of New Zealand employment law – were ruthlessly exploited for the personal gain of the company and its owner," Mills said.
"These breaches were persistent, deliberate, and designed to extract labour at an unlawful discount."
Mills described the penalty ordered as "significant" and a "clear deterrent" to employers who plan to exploit their migrant workers.
"It is a clear message to employers and individual directors that this kind of business behaviour is unacceptable," the official added.
