The Employment Relations Authority has ordered an owner-operator of a labour supply contracting firm to pay $30,000 in penalties for failure to pay 12 migrant employees their minimum entitlements.
The Labour Inspectorate took the case to the Employment Relations Authority (ERA) on behalf of 12 Papua New Guinea (PNG) citizens hired by ICM Horticultural Contracting Limited to work on Te Mata Estate Vinery in Hawke’s Bay for no pay.
The ERA heard that Martha Fretton, the owner-operator of ICM, was under the impression she was providing training to the group of 12 workers, so they could learn about working on vineyards as part of a ‘Global Exposure’ programme. At the vineyard, they received a 30-minute briefing before commencing work that ICM should have paid them for.
The workers were required to record their work in blocksheets, on the basis of which Ms Fretton sent invoices to the vineyard. She billed Te Mata a total of $25,887.61 for the work provided by the group. Te Mata paid this amount to Ms Fretton, but she failed to pay the workers.
A vineyard manager at Te Mata said they understood the group were RSE workers. Te Mata’s contract with ICM provided that all workers were RSE approved, but Te Mata did not actively verify that they were.
Labour Inspectorate Manager Kevin Finnegan says vineyards need to take a good look at their supply chains and ensure they’re only using legitimate contractors.
“Employers need to be mindful of the risk of employment law breaches in the supply chain. Such exploitation can be damaging to the wellbeing of vulnerable workers but also to the business in terms of branding.
“Customers expect employment standards compliance as part of the NZ’s brand for fair treatment of workers. Failing to ensure employees receive their minimum entitlements undercuts businesses that do the right thing and jeopardises exports and domestic sales,” says Mr Finnegan.
The workers were brought to New Zealand on visitor visas by Christina-Kewa and Antony Swarbrick, using the trading name Global 4040. Mrs Swarbrick, originally from PNG herself, claimed she brought the individuals in for an “educative experience” rather than paid employment.
The ERA found this was not the expectation of the workers, however. They had to cover some of their travel costs to New Zealand and were under the impression this money would also grant them paid work.
Mrs Swarbrick originally arranged activities for the group in Waikato, most of which were linked to the Destiny Church. It was also through the church that she met Ms Fretton.
Mrs Swarbrick asked Ms Fretton to provide the workers with training on vineyards, after the workers grew increasingly frustrated with the lack of work.
Ms Fretton paid a total of $9,293.70 to Mrs Swarbrick as a “donation”. Some of this money was distributed to the members of the group as “allowances” and used to cover their accommodation costs, but fell drastically short of the minimum standards they were entitled to.
The Labour Inspectorate estimated that ICM owed a total of $31,128.36 in unpaid wages and holiday pay to the 12 workers. The company has been ordered to re-pay the wage arrears. Subsequent to these proceedings, action has been taken to liquidate ICM, contributing to the $30,000 penalty award against Martha Fretton.
Ms Fretton was ordered to pay $30,000 in penalties for a total of 60 employment standards breaches and what the ERA labelled as “gross negligence”.
MBIE encourages anyone concerned about the employment situation of themselves or someone they know to call its contact centre on 0800 20 90 20, where their concerns will be handled in a safe environment.