A Southland dairy farm and its owner have failed in their appeal against $215,000 in penalties for exploiting vulnerable workers.
The penalties were handed down last year by the Employment Relations Authority.
In July this year, the company and its owner were also fined an additional $15,000 for obstructing investigations by the employment authority.
The original investigation happened last year when Rural Practice Limited and its owner, Reza Abdul-Jabbar, were found to have violated multiple minimum employment standards concerning three Indonesian migrant workers employed on the farm between December 2017 and February 2022.
The breaches include:
- Failing to pay the workers the minimum wage
- Not providing holiday and leave pay correctly
- Making unauthorised deductions from wages
- Requiring workers to pay premiums; and,
- Not maintaining accurate wage and time records
In December 2020, one of the workers reached out to the Ministry of Business, Innovation and Employment’s contact centre to report that he had not received the salary specified in his employment agreement or the number of days off he was entitled to each fortnight.
He also raised concerns that his employer had retained his passport and identification documents despite his requests for them to be returned.
A Labour Inspectorate investigation revealed that each employee had received two versions of their employment agreement—one with a higher salary submitted to Immigration New Zealand (INZ) for visa applications, and another with a lower salary provided to the Labour Inspector. As a result, none of the employees were paid the wages they were actually entitled to.
It was also discovered that deductions had been made from one worker’s wages, allegedly to cover fees charged by a recruitment agency in Indonesia.
Abdul-Jabbar was also found to have served as an imam in his community and acted as a religious adviser for at least one of the three workers he was found to have exploited.
During Abdul-Jabbar’s appeal, it was contended that the vulnerability of the employees had been exaggerated, some breaches did not cause financial harm to the workers, and the Employment Relations Authority (ERA) failed to acknowledge the support provided to the workers, such as accommodation and help with immigration.
It was also contended that the penalties imposed were too severe and that a reduction should have been granted because of his financial situation.
Judge Joanna Holden determined that the financial considerations were within the Employment Relations Authority’s discretion, Abdul-Jabbar’s claim of financial incapacity was unproven, the support provided to employees was not a valid mitigating factor, and the employees were indeed vulnerable.
Judge Holden said the penalties were appropriate given the multiple, systemic, and deliberate breaches identified by the Authority, as well as the financial consequences of those breaches.