Headlines that sends chills down the spines of employers. The first big result for the new MBIE Labour inspectorate Migrant Exploitation team, formed two years ago, the facts of the case “really are modern-day slavery.”
The owner/employer, Sukhdev Singh, owned four Liquor Centre franchises in Te Puna, Greerton, Paeroa and Cherrywood. Between September 2015 and November 2019, five migrant Punjabi workers were exploited by Singh. All of them arrived on student visas and worked for cash in his kiwifruit harvesting business, but were then persuaded to initially work at night for free in the liquor stores. Then the staff began full time jobs, averaging between 65 and 70 hours of work a week, and were underpaid a total of $516,378 over 71 separate breaches of employment law.
Singh confiscated the workers’ bank cards, forced them to work 70-hour weeks and made them sleep in a cubicle at one of his shops.
· Navjot Sidhu slept in the storeroom of the Paeroa Liquor Centre, was underpaid and forced to hand over his bank card and pin. He had to borrow money to survive and suffered stress and depression
· Dupinder Singh said he worked for three months without a single day off
· Harpreet Singh worked seven days a week for nearly two years, had to work while injured and handed over $6000 cash to Sukhdev Singh when he demanded it.
Singh attempted to evade liability by transferring the company shareholdings into Singh’s wife, brother and sister-in-law’s names, but Judge Beck found he was the “controlling mind” of a deliberate and systemic breach of labour laws. Judge Beck had earlier imposed unprecedented freezing orders to stop Singh selling the stores to companies linked to his brother and sister-in-law.
Penalties
The maximum penalties available totalled $7.4m; the Labour Inspectorate had argued the penalties for “sustained, systemic and serious breaches” should total $3.2m, while the defendant claimed they should be just $330,000 based on their co-operation.
Singh and his associated companies, were given a record $1.55 million in fines, with Singh, personally having to pay $415,800 himself within 14 days. The companies which ran the stores have to pay up $1.138m. Singh also received the longest-ever banning order from operating a company, a three-year term starting in January 2023.
The judge ordered payments to be taken from the fines and given to the men. Four men will receive $50,000 each, and the fifth will receive $55,000 after the court heard of their extreme hardship.
The Labour Inspectorate stated that they realised early in the investigation how serious it was, so applied for the freezing order, and lifted it only when a bank guarantee was lodged for $3 million dollars. This means that the penalties and fines are guaranteed to be paid.
This case was unprecedented. The level of offending and degree of penalties are reflective of this being at the extreme serious end of migrant exploitation. It does indicate that there remains a major systemic issue with migrant employees being exploited for commercial gain, within not just the liquor industry.
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