Chinese chef Chenming Sun was illegally charged for a job in New Zealand where he was under paid and deliberately exploited by his employer, an investigation by the Labour Inspectorate ruled.
A chef was held to “ransom” and exploited by his employer after having to pay more than $16,500 to buy a job in which he ended up being overworked and underpaid.
Chenming Sun moved to New Zealand in 2017 to become a chef at Happytime BBQ Restaurant Ltd, trading as Hehe Barbeque, in Central Auckland.
The company’s sole director Ayang Sony had arranged for him to travel from China to work for her company under her direction and supervision – but that required a $16,500 premium.
While Song claimed the money was a refundable deposit, it was not returned when Sun’s employment ended – something the Employment Relations Authority has now found to have been a breach of the Wages Protection Act 1983.
“The purpose of the payment was obviously to buy a job and it was therefore an illegal premium requested and received,” said Authority member Alastair Dumbleton.
Sun signed an employment contract to work 40 hours a week over five days at $22 an hour when he got the job. But, once he started in the job he was forced to work longer hours for less money. Some fortnights he wasn’t paid at all and others he was underpaid which reduced his hourly rate to below the minimum wage of $15.75 for the next 18 months.
When he quit in April 2019 Sun complained to the Labour Inspectorate about the company and Song.
This week the Employment Relations Authority ordered the company to pay penalties of $102,000 and Song to pay $51,000 for breaches of employment standards as well as $65,500 to Sun for wage arrears.
A thorough investigation concluded the company had breached minimum employment standards by failing to pay Sun the minimum wage for all hours worked, not paying time-and-a-half and providing alternative holidays for working public holidays, failing to keep full holiday and leave records, not paying for unworked public holidays, not keeping full wage and time records and not providing compliant employment agreements.
The company also breached the act by taking the illegal premium payment from Sun to secure the job.
The inspector found Sun was entitled to $65,503.78 for underpayment of wages, holiday pay, other allowances and required the company to pay that money to him.
When the company failed to pay the inspector applied to the ERA for an investigation and determination into its ability to cover the arrears and penalties for the breaches.
Song was added to the application, as someone involved in the offending, and a determination she was liable for any debt the company couldn’t pay.
Penalties for the breaches Song was involved with were also sought.
At an investigation meeting Song, assisted by an interpreter, offered no defence and accepted the claims against her personally and her company.
The investigation found, and the authority accepted, Sun usually worked 60 hours a week in the restaurant, 10 hours on six days.
When he left in 2019 Sun sent a text to Song which read – “Sister YANG, consider the issue from my side, I am stopping to go to work, no wages for half year is quite a big impact to me, I left my family and come to here is not an easy thing, I can’t bear this being dragged on, I apologise to you about this.”
He sought but did not receive a refund of the premium.
The inspector sought penalties to be imposed on Song and her company for the breaches, which were alleged to have been deliberate.
“Ms Song as the controlling mind and hands of the employer HBRL, over a significant period deliberately and seriously exploited Chenming Sun as a vulnerable migrant worker,” it was submitted.
“She received personal financial gain from her conduct in requiring a premium be paid as a condition of securing the employment.”
The Authority endorsed the inspector’s submission that receiving a premium was an insidious example of an employer exploiting the inequality of power in an employment relationship entered into with a vulnerable worker.
The business’ illegal conduct also gave it a competitive edge over the competition, through having lower payroll expenses than those complying with the regulations.
The deliberate breaches were exploitative behaviour which injured Sun’s dignity.
“She had been in business for several years employing a number of workers and trading in a populous city environment and can be taken to have known the legal requirements. Any ignorance on her part would not excuse the conduct.”
Sun had been effectively held to “ransom” by his natural ambitions to advance the quality of his and his family’s lives in China.
“He was fearful of reporting his employer to the Labour Inspectorate in case he lost his job and with it his right to work and live in New Zealand. That trap is liable to be used to advantage by an unscrupulous employer of a migrant worker.”
The ERA ordered the company to pay penalties of $102,000 and Song to pay $51,000, from which Sun would receive $10,000 and $5000 respectively with the rest going to the Crown.
It also ordered the company to pay the Labour Inspector $65,503.78, plus interest from August 12, 2022, for the use of Sun. If the company was unable to pay then the debt would be transferred to Song.
The Registrar of the New Zealand Companies Register has begun the process to remove Happytime BBQ Restaurant Ltd from the register for failing to file its annual return.