EMPLOYMENT LAW NEWS

August 2006 Issue No: 9

Engaging Overseas Employees – Do You Know What to Do?
In locations where seasonal work is prevalent, employing overseas workers is common. However, it can be problematic.
The Immigration Act makes it an offence to employ a person not being a resident or citizen who does not hold a work permit. The penalty for knowingly employing an over-stayer attracts a fine of $50,000.00, whereas to employ an over-stayer without ‘reasonable excuse’ risks a fine of $10,000.00. Getting away with employing over-stayers is getting tougher. The number of immigration investigations is rising.
Being employed by an overseas company or a salary being paid into an overseas bank account does not prevent an ‘activity’ being defined as work. Neither does the fact that a person is not being paid. The Immigration Act defines employment as an activity for gain or reward. Working for nothing in order to obtain a job offer for a resident application amounts to work and creates an offence for the employer and is a breach of residence policy.
There are some common exceptions to the rule set out above. There is a Company Executive negotiations exception. This is limited to a three month period in any calendar year. There are also exemptions for overseas buyers, sales representatives, and government officials from overseas countries. We suggest that if you are considering employing overseas workers you obtain approval, in principal, in advance. This process involves confirming the financial potential for the organisation to provide employment. If your business is not doing well – do not bother trying. Further, if a Company fails to return a profit, difficulties arise if the overseas worker wishes to extend their stay. Employers must be prepared to disclose financial information. Not many business owners are keen on this idea.
Historically there have been scams involving ‘job offers’ as a means to obtain immigration. This has resulted in job offers now being scrutinised closely. Further, if an employer provides false information they may be liable for a fine up to $100,000.00. We suggest that if employers are facing an interview with an investigating officer that they insist on having representation present. The purpose of such representation is to ensure that the interview is recorded correctly and in full, not just what the investigating officer may choose to record. Further, after the interview the employer may require advice regarding matters raised during the interview.
It is important to remember that under the Immigration Act there is no statutory right to interrogate and that the Bill of Rights Act may be used to support a request for a postponement of the interview until representation is available.
There have been cases of fraud with the ‘work – to – residence accredited employer’s policy’. This policy involves organisations applying for permission to employ talented people, who will be paid over 45k a year. The work permit is then not tested and results in residence after two years. There have been stories of some employees paying large amounts of money to effectively buy a job offer and then pay for his or her own salary. Such employees do not then work but may play golf all day! It is unfortunate that a few acting fraudulently puts others under the spotlight.
Thankfully immigration fraud is now being investigated, such investigations however may be more than blunt. It is important if you are an employer that you are aware of your rights during an interview, that you ensure you choose carefully the people you deal with and that you have correct pre-employment documents in place to ensure you do not inadvertently employ a person not being a NZ resident or citizen who does not hold a work permit and thus making you liable to a fine of $10,000.00. Phone us for further information.