Overseas recruitment practices face scrutiny after workers left without jobs
The Employment Relations Authority (ERA) recently dealt with a case where three overseas workers claimed they were unjustifiably dismissed and disadvantaged after arriving in New Zealand under work visas.
They argued they never started their promised employment despite having valid visas that restricted them to work only for their sponsoring employer.
The case raised important questions about employer obligations under New Zealand's immigration and employment laws, the use of recruitment agents, and the consequences when promised employment fails to materialise.
The case began when a New Zealand company received accreditation and ten work tokens from New Zealand Immigration for overseas recruitment. The company directors knew one of their chosen agents from previous work in 2020, and gave him five job tokens along with blank employment agreement templates carrying the director's signature.
The directors could only contact this agent through WeChat messaging. They had no physical address or telephone numbers for him. When discussing recruitment arrangements, the agent refused to sign an agency agreement but asked for blank employment agreement templates with the director's signature.
This arrangement led to three workers being recruited from China through different agencies. Two learned about the opportunity during a family meal where they discussed employment difficulties in China. They contacted an agency advertising high overseas income. The third worker, who had construction experience, was introduced to another agency through a family connection.
After arriving in New Zealand, the workers discovered they couldn't contact their employer directly. Their work visas specifically limited them to working as carpentry assistants for the construction company in Auckland. Their only contact was through recruitment agents who became hostile when questioned about the employment.
One exchange through WeChat showed their deteriorating situation. A worker messaged: "Now that I am here, I haven't seen any commercial construction sites or met the employer. I was sent directly to a private construction site, and there are no guarantees for work hours or wages."
The agent's response revealed concerning recruitment practices: "The sponsorship is to bring you to Auckland. As for providing work, since you don't have professional skills, you'll need to rely on yourself to learn... We are just helping as friends. In that case, I'll have the employer company terminate your employment."
The situation severely impacted the workers' ability to earn a living. Their visas restricted them to working only for the sponsoring employer. One worker returned to China due to financial difficulties, while another obtained a new visa and found permanent employment elsewhere.
The ERA examined whether the company fulfilled its obligations as an accredited employer. The decision stated: "[The employer] confirmed that it engaged and authorised [the agent] to recruit workers from China on its behalf, providing him with tokens and a blank signed employment agreement template to facilitate that process."
The workers faced significant hardship, as revealed in further WeChat messages: "[Worker]: We are now picking vegetable leaves and frying rice with just salt, without even cooking oil... We need an employer to sponsor and sign a contract, but we haven't even met the employer."
The ERA found the construction company had failed in multiple areas of employer obligations: "The situation caused them stress and anxiety compounded not only by the financial and illegal payments to the agents in China and the exorbitant amounts they were charged for transport from Auckland airport on their arrival in Auckland, but also by their inability to read or speak English which hindered their ability to track down their employer in New Zealand."
The Authority emphasised: "[The employer's] failure to act as a responsible employer when issuing the job tokens and a signed employment agreement template to [the agent] and ensuring the expected work was provided, was an unjustifiable action on its part."
The ERA ordered the company to pay each worker $30,000 in compensation for humiliation, loss of dignity, and injury to feelings, plus lost wages. Additionally, the company was ordered to pay a $14,000 penalty to the Crown for breaching its duty of good faith under the Employment Relations Act 2000.
