Is your company complying with the minimum employment standards? If not, you could face a ban on hiring migrant workers!

There have been recent reports in the media shaming operators who have been found breaching their statutory employment obligations, such as failing to provide employment agreements and paying at least the minimum wage. Media coverage like this can be very damaging to the reputation of a business.

What you may not realise, as was the case for Mainfreight recently, a breach of minimum employment obligations can result in a ban on hiring migrant workers.

In an article published on 7 July 2017 by NZ Herald, Mainfreight’s chairman, Bruce Plested spoke out against the ban put on the company as a result of failing to provide employment agreements to three staff. According to Mainfreight the three staff members were New Zealand citizens. Mainfreight has been penalised by the Labour Inspector for this breach and is unable to hire migrant workers for six months from 28 April to 28 October 2017, after being issued a $3,000 infringement notice.

New restrictions for non-compliant employers

Since 1 April this year, employers who breach minimum employment standards now face access restrictions to the foreign labour market including stand-down periods. This is in addition to financial penalties that may be imposed. This will affect employers supporting Work Visa and residence applications and Approvals in Principle, seeking Accredited Employer status, and those who are part of the Recognised Seasonal Employer Scheme. The stand-down periods can range from six months to two years.

As at 21 June 2017, there were 18 employers on the MBIE stand down list. As at 26 July 2016, there are 49 employers. A number of these employers have been stood down for a year, four employers for one and a half years and one employer for two years. The MBIE stand down list is published online and can be viewed by anyone.

While we all think that we are doing the right thing by the law, it is prudent to be certain. Remember Labour Inspectors have wide reaching powers, to ensure that workplaces meet at least the minimum standards and requirements of employment law.

For some cases (e.g. where vulnerable workers have been exploited or where rights have been breached repeatedly or blatantly), Labour Inspectors may look at penalty actions, publicise the case and even aim to remove employers from the labour market.

What employers need to know if a Labour Inspector comes to the workplace:

  • Always ask to see the Labour Inspector’s warrant
  • Keep a copy of any documents the Labour Inspector takes
  • If you refuse to cooperate the Labour Inspector can bring an action against an employer for a penalty.

Labour Inspectors can:

  • come into any workplace at a reasonable hour and can bring others with them (including the police and immigration officers);
  • interview anyone;
  • ask to see and take copies of wages and time records, holiday and leave records, other documents with remuneration information.

We recommend that all employers take steps to ensure that their current systems comply with the minimum employment standards and immigration requirements (where applicable).

If employers have any questions about this topic, or any employment or immigration issues they should seek legal advice.

Talk to us

Contact our Employment Law Team today for your employment health audit.

Disclaimer: The information contained in this publication is of a general nature and is not intended as legal advice. It is important that you seek legal advice that is specific to your circumstances.

Topics: All Select

Nick Mason

Position: Partner
DDI: +64 3 545 7897