An Auckland restaurant and its former director have been ordered to pay almost $400,000 after authorities found migrant workers were systematically underpaid and subjected to serious breaches of employment law.
According to a report by the New Zealand Herald, the Employment Relations Authority (ERA) ruled that The Indian Taste Ltd and its former director, Krishna Khandelwal, failed to meet multiple employment obligations, resulting in significant financial penalties and compensation orders.
Under the ruling, the restaurant must pay nearly $200,000 in wage arrears to seven affected employees. Khandelwal, who was the company’s sole director, has also been fined $177,300 for his role in the exploitation, with an additional $35,000 to be shared equally among the seven workers.
The ERA found that employees were frequently required to work between 60 and 90 hours per week while receiving pay for only about 30 hours of work. Some workers were also made to work for one to two weeks without pay when they first joined the business, the New Zealand Herald has reported.
According to Labour Inspectorate migrant exploitation manager Sam Mills, the workers were particularly vulnerable due to language barriers and limited knowledge of New Zealand employment laws.
“The ‘vulnerable’ workers, many of whom had 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, as quoted by the New Zealand Herald.
“These breaches were persistent, deliberate and designed to extract labour at an unlawful discount,” as quoted by the New Zealand Herald.
The Labour Inspectorate began investigating after receiving multiple complaints between March and December 2024. The penalties announced follow a nine-month investigation into the business's employment practices.
The investigation uncovered a range of employment violations, including failure to pay the minimum wage, unlawful wage deductions, failure to provide annual holiday and alternative holiday entitlements, requiring workers to pay premiums to secure employment, and maintaining inaccurate wage and leave records.
Mills said the outcome sends a strong message to employers who attempt to take advantage of vulnerable workers.
The “significant” penalty imposed was a “clear deterrent to employers who seek to take advantage of vulnerable people trying to build a life in New Zealand”, Mills said, as quoted by the New Zealand Herald.
ERA Member Matthew Piper said Khandelwal had direct control over the company's actions during the period in question and benefited financially from the unlawful practices.
“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,” as quoted by the New Zealand Herald.
Piper noted that the impact on workers extended beyond lost wages. Many were forced into financial hardship, including taking out personal loans and borrowing money at high interest rates, while being unable to support family members overseas, the New Zealand Herald has reported.
The Ministry of Business, Innovation and Employment has encouraged anyone who believes they have experienced unfair treatment at work to seek assistance through its contact centre, where concerns can be raised confidentially and safely, as reported by the New Zealand Herald.