A Lower Hutt restaurant has been fined $90,000 and ordered to pay more than $81,000 in reparations and tax arrears after it was found to have systematically exploited two migrant workers from India over a period of four years.
The Wellington District Court found the company guilty of two representative charges under the Immigration Act 2009 for the mistreatment, which occurred between 2017 and 2021. The case was brought following an investigation by the Ministry of Business, Innovation and Employment (MBIE) after two workers came forward to report the serious breaches of their employment rights.
In addition to the fine, the court ordered the restaurant to pay a total of $55,936.40 in reparation to the two affected workers. A further payment of $25,926.47 was ordered to be paid to the Inland Revenue Department to cover outstanding tax obligations.
The penalty comes as a stern warning to other employers and highlights a continuing issue within some of New Zealand's industries. It also underscores a troubling pattern of migrant exploitation that has been seen in other local businesses, including a separate case involving Lower Hutt's Well Sushi, which was fined $30,000 for exploiting a vulnerable worker who was owed more than $50,000 in wages.
Details of exploitation emerge
The investigation by MBIE and Immigration New Zealand (INZ) uncovered what officials called a "consistent pattern of excessive hours, underpayment, and deductions from wages." The two employees, both Indian nationals on temporary work visas, were found to be working significantly longer hours than they were paid for.
Jason Perry, National Manager of Investigations at MBIE, said the workers were putting in up to nine hours a day, six days a week. In one instance, an employee who often worked close to 54 hours a week was only paid for 36.5 hours.
Investigators calculated that across both workers, the company owed a total of $72,502.21 in arrears. This comprised $36,217.78 in unpaid minimum wage entitlements and a further $36,284.43 for unpaid holiday pay, sick leave, and other statutory entitlements.
"More than $72,000 in arrears was owed in this case, demonstrating the extent and seriousness of the exploitation," Mr Perry said.
Visa rules manipulated by employer
The investigation also revealed the employer had manipulated visa and pay-related rules. In one specific period between 2020 and September 2021, the restaurant deducted $50 per week from a worker's pay for food.
This occurred at the same time the company increased the worker’s hourly rate to $25.50, a move designed to meet the minimum pay threshold required for an essential skills residence visa. Mr Perry described this as an unlawful passing on of costs to the employee.
Employers are solely responsible for meeting visa‑related pay requirements and must never pass those costs on to workers. Using visa requirements or a worker’s immigration status to influence their employment is unlawful and will not be tolerated.
Mr Perry emphasised that all workers in New Zealand, irrespective of their immigration status, have the same rights to be paid for every hour they work and to receive all their legal leave entitlements. These rights are protected under New Zealand law, and resources are available for workers to understand them through official channels like the Employment New Zealand website.
A wider systemic problem
Migrant worker exploitation is not a new problem for the region or the country. The power imbalance inherent in many sponsor-employee relationships can make workers particularly vulnerable. As noted by a labour inspector in the previous Well Sushi case, workers may have little experience of New Zealand employment standards and limited access to support networks.
Mr Perry said that such exploitation has damaging ripple effects beyond the harm caused to individuals. It creates unfair market conditions, allowing unscrupulous businesses to gain an advantage over the majority of compliant local retailers who follow the rules. This issue of businesses needing to adapt to changing markets and operational norms is further explored in how small-town restaurants are scaling.
"Exploitation undercuts compliant employers, distorts fair competition, and weakens confidence in the wider immigration system," he said. This erosion of trust and fairness has wider implications for New Zealand's economic well-being, a concern echoed by other sectors warning that the nation's prosperity is at risk without robust and fair policies.
MBIE and INZ continue to treat migrant exploitation as a top priority and encourage anyone who believes they are being mistreated to come forward, assuring them that they can do so safely and confidentially.
"Exploitation is not a business model; it is unlawful, harmful, and taken seriously," Mr Perry says. "Ensuring New Zealand remains a fair place to work depends on holding employers who breach minimum standards to account."
