MBIE swoops on kiwifruit contractors, 12 investigations into exploitation underway

Wednesday, 12 February 2025

Several current investigations into kiwifruit contractors involve claims of wage recycling, where employees are asked to pay a portion of their wage back to their employer.

The Labour Inspectorate has 12 “open and current” files related to Bay of Plenty kiwifruit contractors.

Four cases have been referred to the Employment Relations Authority due to their “serious nature”.

Stuff learnt of investigations after several messages from a whistleblower advising of issues within the industry.

A dozen investigations are underway into alleged labour exploitation within the Bay of Plenty kiwifruit industry, with four cases referred to the Employment Relations Authority due to their “serious nature', Stuff can reveal.

Labour Inspectorate investigators are working with Zespri to advise it of issues, and recommend the cancellation, or suspension, of the accreditation required to work on supplier orchards.

It comes after several probes last year resulted in kiwifruit labour company owners being fined and, in some cases, convicted of criminal offences.

The Labour Inspectorate's lead inspector for the horticultural industry, Kevin Finnegan, confirmed to Stuff the department has 12 “open and current” files related to Bay of Plenty-based kiwifruit contractors.

“Three of those files are being monitored to ensure arrears payments are being made to employees while the other nine files are still subject to further investigation,” he said.

Stuff was made aware of the investigations via a whistleblower, who claimed he himself had been on the receiving end of labour exploitation.

The worker, who said he has taken his case to the Employment Relations Authority (ERA), claims his former employer denied him a written employment agreement and insisted he and his colleagues work for cash payments below minimum wage.

He provided Stuff with a copy of an Official Information Act response from the Ministry of Business Immigration and Employment, which revealed “a number of ongoing investigations”.

“Four of these cases are either filed, or about to be filed, in the Employment Relations Authority because of the serious nature of the labour exploitation,” the OIA response stated.

Finnegan told Stuff the alleged exploitation being probed included workers not being paid the rate specified in their contract, deductions being made from pay without consent, leave entitlements not being recorded, and incorrect holiday payments.

Allegations of “wage recycling”, which required employees to send some of their pay back to the employer, are also being investigated as well as instances of employees paying employers or agents to secure a job.

“All of the above alleged acts of exploitation have been encountered in one or more of the various cases investigated by the Labour Inspectorate,” Finnegan said.

One of several investigations reported last year involved these Indian migrants, who paid premiums of up to $50,000 for their jobs.

The OIA response showed Labour Inspectorate investigators were working with Zespri to advise it of issues and recommend the cancellation, or suspension, of Compliance Assessment Verification (CAV) accreditation.

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Finnegan said contractors should not be employed to work on Zespri orchards without accreditation.

The Labour Inspectorate’s investigations relate to both approved and non-approved contractors.

Indian migrant workers, paying premiums of up to 50 thousand dollars to their employer, are left high and dry after the employer put the kiwifruit company into liquidation.

New investigations follow on from 2024

The developments follow a series of investigations last year, which resulted in contractors being fined or convicted over instances of exploitation.

In July, Jafar Kurisi, aka Ali or Tauranga Ali, 60, was sentenced to 12 months’ home detention and ordered to pay $80,000 to his victims.

He was charged in late 2020 following a string of past complaints about mistreatment of migrant workers in the kiwifruit/horticultural industry.

The investigation involved five homes in the Tauranga area being searched. Investigators spoke to 27 people from Indonesia, Malaysia, India and Bangladesh, about their immigration and employment in New Zealand.

In December, another outfit, Asad Horticulture, was ordered to pay $70,000 for breaching minimum employment standards, and being in arrears over holiday pay.

The case involved three workers being owed over $40,000 in holiday entitlements.

Asad Horticulture entered liquidation last year, owing the Inland Revenue Department (IRD) over $780,000.

Meanwhile, as Stuff previously reported, Immigration New Zealand was understood to be investigating another case involving Paul Enterprises, a company that was blacklisted by Zespri and had its visa accreditation revoked.

The company brought a number of Indian migrants to New Zealand to work in the kiwifruit industry, but was liquidated owing over $1 million to the IRD as some of the new employees were flying over.

One of the men, Fuljinder Singh, told Stuff he and six other migrants paid between $20,000 and $50,000 to secure their jobs.

Instead, they were underpaid or not paid at all, received no holiday pay, no sick leave, no payslips or employment agreements, had been given irregular hours, and were paid well below their contracted rate, he said.