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Samra Holdings to pay penalties of over $1.55 million

In a landmark judgment, the Employment Court ordered the Samra Holdings group of companies and a person involved in breaches of minimum employment standards to pay penalties of over $1.55 million.

Of the total penalty amount of $1.55 million, Justice Kathryn Beck ordered paying the five migrant employees $255,000 in varying amounts, which is in addition to over $500,000 of arrears which has already been paid by the employer. These employees did not receive minimum entitlements while working at the company’s liquor stores during various times between September 2015 and November 2019.

The penalties are the highest awarded for employment breaches to date and the banning order of three years against the sixth defendant – Sukhdev Singh – is for the longest period of time, said Stu Lumsden, Head of Compliance & Enforcement, Labour Inspectorate.

“The outcome is the culmination of several years of investigation work by our migrant exploitation team and reflects the seriousness and systemic nature of the offending, Lumsden says.

The court identified 120 discrete breaches in employment standards and banned Singh, who exercised significant influence over the management and administration of the companies. Singh was involved in 49 breaches of minimum entitlement provisions by Samra Holdings and three group companies, and these companies have been similarly banned for two years. Singh, who has been in the retail liquor industry since 2005, had previously received an Improvement Notice from the Labour Inspectorate in 2014 for his kiwifruit business.

“This was deliberate and sustained exploitation of vulnerable migrants who were reliant on the employer for their jobs and visas. The people involved gained substantial commercial benefit unlawfully by exploiting the employees.”

“Noting the serious nature of the breaches of minimum entitlements and significant arrears owed to the five complainants, Labour Inspectors moved quickly and applied to the court for freezing orders -to be placed on the employers’ assets. This was the first time the Inspectorate has applied for freezing orders. This application was approved and later discharged after the employer’s bank guaranteed $3m to be held available for payment of the arrears and any penalties”

“Our inspectors have also gone a step beyond to ensure this information is shared with our community stakeholders such as the Allied Retail Group who operate Liquor Centre. We understand that our stakeholders have taken further action against Samra Holdings”

“The Inspectorate believes it is in the public interest to know when employers wittingly exploit their employees, so that workers, consumers and suppliers can make an informed decision when dealing with such businesses”, Lumsden says.

MBIE has been leading an in-depth review to better understand temporary migrant worker exploitation in New Zealand and identify effective and enduring solutions and the Government has introduced the Worker Protection (Migrant and Other Employees) Bill earlier this year to offer more protection and support to our migrant worker communities.

The Labour Inspectorate encourages anyone concerned about their employment situation or the situation of someone they know phone the Ministry’s service centre on 0800 20 90 20 where concerns are handled in a safe environment.

Media contact: media@mbie.govt.nz

 

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