1492221910347 - Labour hire company penalised $9000 for making workers pay bond

Labour hire company penalised $9000 for making workers pay bond

A labour hire company has been fined $9000 for breaching the Wages Protection Act.

One World Resourcing made workers sign a bond agreement that required them to pay a premium if they left the company before their contract had ended.

ERA member Christine Hickey found the only purpose of the agreement was to put pressure on the employees to remain bound to One World.

The Engineers, Printers and Manufacturers Union (EPMU) raised the issue on behalf of two former employees of One World in 2015.

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One World hired five specialist glaziers from the Philippines in 2015 for work on a project.

The company helped the glaziers set up a bank account, and get a bank loan. The glaziers then paid One World $3250 for immigration services, visa costs, flights to Christchurch from Manila, a bicycle, a week’s rent and a wage advance.

In June 2015, One World chief executive Declan Clancy was told two workers were intending to leave to work for another company. 

Clancy met with the workers and asked them to sign five bond documents, he said the workers weren’t pressured to sign the documents.

But one worker claimed Clancy told the workers they would be sent back to the Philippines and possibly be unable to work in New Zealand again if they didn’t sign.

Ministry of Business, Innovation and Employment labour inspector Richard Lewis found One World was seeking an unlawful premium by presenting bond forms to the workers, in breach of the WPA.

In September 2015, One World withdrew the bond requirement.

Hickey said the bond agreement put “moral pressure” on the workers to sign and stated not signing “‘may also impact on your visa opportunities should you wish to return to New Zealand in the future’.” 

Workers had already paid One World almost $3300 for normal employee costs and it was judged the extra bond payment wasn’t needed to cover other appropriate costs, and restricted the workers’ work opportunities.

One World has been ordered by the labour inspector to pay $4500 for each breach – a total of $9000 – including $1500 to each of the two workers in compensation.

“The former employees have not been compensated for the stress and worry that being presented with the bond agreements must have caused them,” Hickey said.

 

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