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Migrant Exploitation and Employment Premiums

Migrant Exploitation and Employment Premiums

Exploitation in the workplace could exist in many forms and could happen to any employee, whether you are a migrant or otherwise. However, it is observed that foreigners are more vulnerable to becoming victims of exploitation due to their unfamiliarity with the relevant laws and not knowing their rights as employees in New Zealand. This is why workplace exploitation is more commonly referred to as 'migrant exploitation'.

What is migrant exploitation?  

Migrant exploitation is defined as behaviour that causes, or increases the risk of, material harm to the economic, social, physical or emotional well-being of a migrant worker. This can include breaches of minimum employment standards or breaches of health and safety and immigration laws. Very often, migrant employees who are victims of exploitation are either not aware that they have been subjected to exploitation or they do not report their employers, fearing that their right to live in New Zealand could be jeopardised. Unfortunately, in some cases, employers capitalise on this fear to take advantage of migrant employees.

What are some examples of migrant exploitation?

There are many situations in which an employee may have been exploited by the employer. Examples of exploitation include but are not limited to:

• The migrant having to give back part or all of their wages to their employer; this is often where an employer is required to pay an employee a specific amount in accordance with a particular visa;

• The migrant being required to pay a sum of money as part and parcel of securing employment. This is known as paying a premium on employment;

• The migrant being paid too little or nothing at all for their work;

• Being paid under minimum wage (minimum wage is currently $21.20);

• The migrant being required to say they have worked less hours than they have;

• Being made to work an excessive number of hours, with no breaks;

• The migrant not being able to take time off from work;

• Not being paid for public holidays or annual leave;

• The migrant not being able to leave their workplace because the doors and windows are locked;

• Being told they must ask for permission to eat, sleep, or go to the toilet;

• Being forced/threatened to do work that is not part of their job;

• Made to work more hours than their visa allows; or

• Being subjected to unwelcome sexual gestures.

Most of the above exploitative behaviours are easily identifiable. However, some exploitation measures are more difficult to recognise.  Employers are finding creative ways to coerce employees into employment. Often employers are requiring migrants to pay for their employment, moving away from the usual modus operandi of outright asking employees to payback part of their salary to the employer. Payment for employment is called a premium.

What is an employment premium?

A premium involves the migrant paying money to secure a job. This sum of money may be paid by way of deduction from wages or otherwise. This is prohibited under Section 12A of the Wages Protection Act 1983 ("the Act").

The Act does not define what constitutes a "premium". The definition of a premium is intentionally left elastic to include situations where payment is received by the employer to purchase a job, or more subtle arrangements. It extends to situations where an employer recoups, or attempts to recoup, recruitment-related costs or other expenses that would normally be borne by an employer.

Some examples of employment premiums are where the employee's offer of employment is contingent on:

• the employee purchasing products and/or services that the employer is selling; and/or

• paying to attend a course or programme administered by the employer or its affiliate.


Whether you are an employee or employer, it is recommended that you take note of the possible scenarios that may fall under exploitative behaviours and seek legal advice before entering into an employment agreement. Alternatively, if you are concerned about any of the above, please reach out to:

• Melissa Johnston (Employment Law Partner) on (09) 306 6729 (

• Ramya Sathiyanathan (Immigration Law Special Counsel) on (09) 306 6727 (

• Hiruni Wijewardhana (Solicitor) on (09) 262 4940 (

• Kai Ling Chiu (Cantonese and Mandarin-speaking Litigation Solicitor) on (09) 951 2573 (

See our Expertise pages

Employment Law - Employers

Employment Law - Employees


Litigation & Dispute Resolution

Written by:  Melissa Johnston and Kai Ling Chiu

© McVeagh Fleming 2022

This article is published for general information purposes only.  Legal content in this article is necessarily of a general nature and should not be relied upon as legal advice.  If you require specific legal advice in respect of any legal issue, you should always engage a lawyer to provide that advice.

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