The cash-for-job scam is now so common that Immigration New Zealand is investigating 55 possible cases. Photo / Alan Gibson
Hardeep Singh's introduction to the New Zealand dream was working seven days a week in an Ashburton dairy. When he did get paid it was no more than $8.50 an hour.
One day Singh's boss ordered him to work for a week in another dairy in Christchurch. He got no money for travel or living expenses, so when the dairy was shut, he slept on the floor.
The appalling working conditions faced by Singh and four other Indian students in their bid to gain New Zealand residency were revealed in an Employment Court judgment last month.
Singh worked at least 60 hours a week but was not paid for his first two weeks work and received no holiday pay. He was dismissed in a text message.
Another student, Harpal Bola, who worked for two and a half months without a day off, was refused leave to see a doctor for an infection.
The judgment says that when a third student, Harbaldeep Singh, was sick and had to take two days off, his pay was halved. When he asked for a wage increase or days off, his boss Dilbag Singh Bal, who owned dairies and liquor stores across the South Island, threatened to have his work visa revoked.
Another student worked 11-hour days for six or seven days a week in sole charge at two liquor stores and ended up in hospital, while a fifth was not paid for a total of seven weeks and threatened by Bal when he asked for the minimum wage.
The court, headed by chief judge Graeme Colgan, noted that Bal had already been sentenced to nine months home detention on separate immigration and migrant exploitation charges involving six other employees. It ordered the two businesses involved, Warrington Discount Tobacco Limited and Preet PVT Limited, to pay a combined $100,000 for deliberately underpaying their staff.
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The judgment emphasised that the students were described as "managers" to satisfy Immigration requirements, but were in fact no more than shop assistants who relied on the jobs to keep their temporary work visas.
As a result "the defendants wielded a significant degree of control over whether the former employees were able to remain in New Zealand lawfully.
"The companies' owners made it clear, both subtly and sometimes even overtly, that they held this power over their employees.
"The staff endured these substandard and unlawful terms and conditions of their employment largely in the hope that they would eventually move on to better employment and, with it, the prospect of permanent residence in New Zealand for themselves and perhaps also their families."
AUT business school researcher Danae Anderson, who has surveyed 483 international students for her PhD, says this is the mindset that keeps migrant exploitation going.
Most of the students she talked to knew they were being underpaid and overworked to a varying extent, she says, but saw it as a way to achieve their New Zealand dream.
"A lot of them say: 'New Zealand's not really what I expected and I thought it would be better here but it's better than India...' They were looking towards the future where they thought they would do something better."
The Employment Court ruling is the latest in a flood of migrant worker exploitation cases, which prompted the Government to introduce tougher sentences for rogue employers last year. One Indian woman was forced to pay her boss $14,400 for a job in a Christchurch restaurant to secure her work visa and permanent residency application. A Wellington grocery store forced an Indian man who needed a visa to pay $10,000. And in perhaps the most high profile case, bosses at the Masala Indian restaurant chain in Auckland were found guilty of underpaying and exploiting workers, who were paid as little as $3 an hour in the hope of securing a visa and residency.
The cash-for-job scam is now so common that Immigration New Zealand is investigating 55 possible cases. Anderson says the going rate for a "job letter" in Auckland is $20,000 to $25,000, but she has heard of payments up to $40,000.
Researchers say evidence has been building for years that foreign students are working in substandard conditions in the hope of winning long-term residency.
A 2011 thesis found 42 per cent of Chinese international students were paid below the minimum wage, compared to only 7 per cent of domestic students. In 2012 an undercover AUT report led by Anderson revealed 93 international students were working illegally in Bay of Plenty orchards while almost half supposedly studied business, IT and cookery courses at private training establishments (PTEs) in Auckland. The mainly male Indian students were paid only $8 to $11 an hour for up to 55 hours a week, breaching both the minimum wage and their student visa, which allowed them to work only 20 hours a week.
In April a University of Auckland survey of 891 temporary migrants - including 457 international students - found about 20 per cent admitted being paid less than the minimum wage. For those in accommodation and hospitality, the figure rose to 44 per cent.
Author Dr Francis Collins argues that New Zealand's immigration policies have created the environment which makes students vulnerable to exploitation. In the 1990s, he says, international education was dominated by short term courses at language schools for students who left soon afterwards. Successive governments realised they could entice more students to come - and bring more money into New Zealand - by allowing them to work for up to 20 hours a week and pitching the courses as a pathway to immigration.
As a result, says Collins, immigrants from poor countries such as India and the Philippines increasingly come here on student visas, with the aim of moving to a work visa afterwards and ultimately gaining permanent residency.
Many take on tens of thousands of dollars in debt to pay for their courses, which in turn pushes them into low paid and sometimes illegal work as they are desperate to earn money and not in a position to get any better jobs.
The financial desperation also affects their course choices. One Indian woman in his survey said she chose a PTE which offered weekend classes, so she could work all week to pay back her loan.
Collins argues that New Zealand is deceiving international students with false hopes of residency. Nearly half the international students he surveyed came to New Zealand to win permanent residency, yet Ministry of Business Innovation and Employment figures show only 17 per cent of all international students achieve this after five years. The figure improves slightly to 27 per cent five years after finishing their studies but this may mean many are just "churning" from visa to visa in the hope of staying, while many others probably give up and go home.
Collins points the finger at politicians, who he says are far too focused on getting revenue out of students, without considering their welfare.
"The Government is quite clearly utilising various mechanisms... so that students can work in order to promote the export education scheme - that is to make money out of it and to use students as a commodity in that sector."
Tertiary Education Minister Steven Joyce flatly rejects the criticism. "We're putting a lot of effort into dealing with those issues... I would say, if you look at the numbers, they are not prevalent - but they are a concern."
Anderson's survey found just over half the students admitted they were working in breach of their visa conditions. Indian students were the most underpaid, often working for as little as $6 an hour.
Anderson says many Indian and Chinese students were being exploited by employers in their own ethnic communities. But she found 36 per cent of the employers were NZ-European, compared to 39 per cent Indian and 17 per cent Chinese.
"We've always said it's Indians ripping off Indians. Yes, there's a significant proportion of that but there (a lot of) European New Zealanders... so I don't know if that's them wanting a slice of the pie too."
Dennis Maga, co-ordinator for the migrant workers union Unemig, believes the Government has been slow to clamp down on the exploitation of international students because it provides many employers at the bottom of the market with a pool of highly vulnerable cheap labour.
He predicts the huge increase in Indian students over the last three years will seriously affect the labour market soon.
"Employers get the message; if you don't want to pay decent wages, there are lots of migrants coming to New Zealand who will work for less than the minimum wage."
Immigration Minister Michael Woodhouse rejects Maga's claims, saying New Zealand has enjoyed steady wage growth for years. He says he's aware of the potential of temporary migrants to push down wages, especially in some areas of the economy such as horticulture and the hospitality industry, but there is no evidence of this happening in most cases.
In 2012 an undercover report found....
93 Indian migrants working illegally in Bay of Plenty kiwifruit orchards for up to
55 hours a week at
$8 to $11 an hour
42% were supposed to be studying business, IT and cookery courses at PTEs in Auckland.
(Source: AUT Business School study)
Students in Auckland today
30,000 or more international students estimated to be working in Auckland.
10,000 in accommodation and hospitality
20 per cent admit being paid less than the minimum wage.
44 per cent for those in accommodation and hospitality
40 per cent of Indian and Filipino migrant workers in debt
28 per cent of those intending to apply for permanent residency.
(Source: University of Auckland survey, April 2016)
• Monday: Visa and school fraud
• Tuesday: Student exploitation
• Wednesday: Effect on immigration
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