Kiwi reveals firm’s treatment of migrants
One small broadband company's treatment of its migrant workers is a case study of problems being investigated by government officials. Teuila Fuatai reports.
In a quiet cul-de-sac overlooking Auckland’s Te Atatu Peninsula, Roderick Laus welcomes people into his modern, two-storey home. The Filipino migrant-come-New Zealand citizen owns fibre installation company 3ML Services. Softly spoken with two silver front teeth revealed in a boyish grin, Laus seems anything but the boss his former workers claim he is.
Newsroom, which has been inquiring into 3ML over accusations of migrant and employment exploitation, met Laus and his right-hand man Jolan Castro to get their side of the story. Laus’ company is one of hundreds subcontracted to work on the Chorus network via four large, Australian- based companies: UCG, Visionstream, Downer and Broadspectrum.
Claims made by former 3ML workers include non-payment of wages, pay rates below the minimum wage, use of workers’ annual leave to pay for normal working days and a failure to provide employment contracts. Workers have also raised concerns about a lack of proper equipment at the company and potential safety issues.
When asked whether people were forced to work without proper compensation for periods of up to five months, Castro says: “Show us the evidence."
In response to questions about whether the company ever settled with an employee over unpaid wages, he answers: "No, that never happened - not that I remember."
Notably, Castro does most of the talking - with Laus nodding mostly in silent agreement.
“This is a personal grudge from one of the [former] employees who is very driven to bring this company in the spotlight. [He] wants to make it appear to the public there was some sort of exploitation happening, and there are some sort of other payments and illegal deductions happening. I believe it is for them to prove that,” Castro says.
In his view, the former employees accusing the company of exploitation are also unhappy because 3ML refused to support their permanent residency applications.
“That was how it started, to be honest with you,” Castro says. “We turned down five [or] six people and those five [or] six people - believe me, they are the ones that ... just resigned.”
Asked about the complaints former staff are making, he said: “If there is a problem we have to talk about it. Show their face, come to us, bring the evidence - bring their documents, their evidences, what they’re saying and then we’re happy to meet on a place where the labour inspectorate is and our lawyer is."
The Kiwi whistleblower
Newsroom’s inquiry shows a pattern of questionable behaviour at 3ML that cannot be attributed to just a few disgruntled ex-employees. Migrant workers, who currently make up 31 of the company’s 33 employees, were worst-affected. In each of the seven cases we reviewed, a significant lack of knowledge of New Zealand labour laws, and the employer's attitudes, resulted in questionable employment practices.
While that is not uncommon in the current context of migrant workforce problems, what sets 3ML apart is the New Zealand whistleblower at the centre.
Twenty-nine-year old Thomas Shepherd is what many would refer to as a typical Kiwi lad. He came across 3ML while looking for a job after a move to Auckland. Shepherd, whose background is in health and safety coordination and compliance, shakes his head while discussing how his temporary stint in the telecommunications industry turned into an eye-opening foray into the country's culture of migrant and employment abuse.
“All of the guys I met were really good guys, all hard-working and all here because they want better opportunities for themselves and their families,” he says of his former workmates.
“But, I was the only Kiwi on staff … and I think that’s why I was the only one who knew how bad it was, well at first anyway. I couldn’t believe it.”
Shepherd, who worked for 3ML for seven months, convinced others to stand up to Laus.
Like Newsroom, he ran into difficulties. Particularly among Filipino workers, wariness of Laus - and the power yielded by his church in his home country - has been a deterrent to speaking out. Of the eight former workers who spoke to Newsroom, five (including Shepherd) eventually felt comfortable having their stories told. Of those, only one has taken formal action against Laus and 3ML.
That man, who did not want to be identified and has since returned to India, received an out-of-court settlement for nearly $11,000. Legal documents, sighted by Newsroom, show the former worker sought compensation for the company’s failure to pay him, outright, for a month. He also wanted the wages owed to him for the period he worked as a “trainee”, less a weekly payment of $150 Laus gave him. Employment legislation allows a lower, minimum trainee wage for a worker who needs further training to become qualified in his or her field. Currently, the minimum hourly trainee rate is $13.20. The regular hourly minimum rate is $16.50. The man, who initially claimed a personal grievance against 3ML, also sought remedies for hurt and humiliation equivalent to three months' pay.
“Honestly, it was the worst time in my life,” he says.
Castro told Newsroom people could learn, informally, on the job without committing to a full-time role. He compared it to enrolling in an education course: “You pay them and then in return, you get the knowledge and the idea of how to do the work.” What Roderick is saying - they’ll come with him, they’ll teach him but of course, it’s just a matter of, kind of a volunteer, so they understand it [the job]. Later on, they will observe them, they will accept them."
Asked how long this could last, Laus added: “They come and go - a few months.”
The church-going boss
Shepherd: “It is difficult to understand just how hard things are for these workers until you’re working alongside them and see first-hand.
“When you don’t know any better, you go along with what he says and does, and you are really in a position of complete powerlessness. These guys are under the impression that Rod has sway over whether they stay here or not, and are scared of never getting the wages owed to them if there is a confrontation.”
Indian native Baljinder Pal Singh is a former 3ML employee who came to New Zealand four years ago for his studies. The 29-year-old began working for Laus in May 2016 after a quick phone call about his job application.
“There were no emails and texts. I didn’t even ask what the pay was going to be. I was under the impression it was going to be a basic pay rate.
“I was thinking maybe I could just get experience in the field. The way they said it [was that] until you get training from 3ML, you probably wouldn’t get paid.”
Initially, things seemed good.
Laus was a well-respected member of his church Iglesia Ni Cristo in Glen Eden. Diligent in his worship, he employed dozens of migrants. Keen to welcome his staff into his faith, Laus often invited them to worship sessions held by his congregation each week.
“He [Laus] was teaching me stuff, how to do this, how to do that. After two weeks, he said: ‘Okay, you are good to go.”
Singh says he worked full-time for five months before he received his first 3ML pay packet.
“[They would always say] this is the process, it’s happening, you will get something, we'll give you the contract and we will pay you”.
In the interim, Laus paid Singh a weekly $150 allowance. “But it is nothing,” Singh says. “Nobody can live on $150 per week, especially with the rent in Auckland.”
A pending visa renewal deadline also made it difficult for Singh to separate from 3ML. He knew that finding a job with a different company would be difficult due to the short amount of time he had left on his visa.
“It was kind of too late for me. If [Laus] had said ‘I was not going to pay you for six months, or even for a year’... I wouldn’t have taken up the job and joined another place.”
3ML produced a contract in the last three months of Singh’s visa. In addition to officially receiving an hourly rate of $15.50 for his role as a telecommunications cabler, Singh also secured a two-year work visa. He says he is yet to receive the owed wages from his first five months' work. [Note: the $15.50 rate met the minimum wage standard at the time.]
Safety risks in the workplace
Singh stayed with the company for another 18 months. Over that time, it expanded into the South Island. In addition to the pay issues, Singh and other former workers claim a lack of proper job equipment also became obvious.
According to Shepherd, one of the worst offences was the failure to provide a “pole strap” to each work team. A pole strap is needed on “aerial jobs” which require work at the top of a power pole. A pole strap loops around the pole and attaches to either side of the harness. If someone falls while working at height, the friction between the strap and pole prevents that person from plunging, Shepherd says.
“Without the pole strap, the harness is useless,” he adds.
An email sent by Shepherd to 3ML in January outlines his concerns:
“Our van is missing a lot of items and equipment which are critical to the job, and it seems that other vans are in a similar predicament. This led to an embarrassing situation today of having to improvise access …. to make an aerial connection, without the use of a pole strap and harness, as none was available. Also, the ladder being used was too short and was aluminium rather than fibreglass, which we’re not meant to use on poles due to conductivity issues.”
Shepherd, who also asked for basic equipment like barrier arms and fire-retardant overalls, says his requests were never met.
Both Castro and Laus deny the allegations, and say employees have always had access to proper safety equipment.
Annual leave pays for your training
Meanwhile Singh, who moved to Invercargill for his work with 3ML in November 2016, was looking forward to a fresh start in the city. However, when jobs from UCG (one of the four big Chorus contractors) began to dry up for 3ML, the company began making changes.
In a staff email three months after Singh’s move south, Castro set out a new pay arrangement:
“UCG is getting slow in assigning jobs which affect all other Delivery Partners, not just us…."
“So we implement the no work no pay til everything is back in normal, because if we force to pay each other the tendency of bankruptcy is there which is no good for those applying their visa in the future [sic].
“So effective today if you only work half day you only paid half day. If you do not work that is no pay.”
Singh says when he objected to the email, citing his fixed, 40-hour week contract, he was shut down.
One of his former Invercargill co-workers, Jaydeep Makwana, has a nearly identical story. The 26-year-old said the company used annual leave days to make up pay packets on those “slow” weeks. However, both Laus and Castro say this never occurred.
Like Singh, Makwana began with 3ML in May 2016. He also worked for about five months without proper compensation, and says he was wholly unaware of the illegal labour practices.
“[At one point] he was actually taking it from our holiday pay and putting it into our accounts [to make up for the hours],” Makwana said.
An email from Castro dated March last year also outlines 3ML’s training policy:
“Just want to advise everyone if we send you on a training or course and if the duration of that training last a day or two regardless, our company will use your annual leave to compensate and cover that day (only if you have annual leave balances). Company paid for the training and that training will mainly benefit you as this will certify yourself and that will not be taken away from you.”
Shepherd and his former 3ML colleagues want Chorus, its contractors like UCG and subcontractors, and ultimately the Government, to address migrant abuse in the fibre-laying industry.
Since last year, the Ministry of Business, Innovation and Employment has been investigating the contractors and subcontractors working on the Government’s $1.78 billion ultra-fast broadband network. Immigration Minister Iain Lees-Galloway, who is aware of allegations against 3ML, declined to comment because of the ongoing MBIE investigation.
The labour inspectorate, which has confirmed 3ML is under investigation, says employment practices in the industry are a mixed picture.
“While many businesses are excellent, some clearly need to make improvements, and there are a few rogue operators engaging in some very troubling practices – which we are following up on,” spokesman David Milne says.
“We expect this work will take some time as we are planning to probe further into the industry and develop a clearer picture of the issues at play.”
E-Tū, the telecommunications sector union, says there are more than 900 Chorus contractors and subcontractors. Spokesman Joe Gallagher understands the MBIE investigation is focused on up to 50.
UCG, which Shepherd contacted about 3ML’s employment practices, say all its subcontracting companies are required to remunerate their employees in accordance with the law.
“If we receive an allegation that one of our subcontracting companies has not paid one or more of their employees lawfully we investigate,” spokesman Roger McArthur says. While he did not want to discuss specific companies, he did confirm 3ML was an approved UCG contractor, "at the time of writing this email".
Chorus spokesman Nathan Beaumont says the company has been assured by all its service companies that employees and subcontractors are “appropriately employed and adhere to health and safety standards".
“Technicians must undergo induction training, including health and safety, before conducting any work on behalf of Chorus. Regular spot checks are also undertaken to ensure compliance.
“In the event of employment disputes, service companies offer dispute resolution channels, and when inappropriate arrangements have been made known, immediate action has been taken.
“We have always made it very clear to all of our service companies that they must comply with the law," Beaumont says.
“Chorus has thousands of people working in the field rolling out the fibre programme and the claims raised are not reflective of the wider industry.
“We are working openly with MBIE as we also wish for any incidents of inappropriate practices amongst subcontractors to be dealt with if they are occurring."
But, Shepherd believes the problem of migrant abuse is still largely hidden among the many smaller firms.
“Many whistleblowers within this industry face significant marginalisation if they come forward. I have colleagues who have been subjected to ongoing harassment since speaking out and asking for help.”
Help us create a sustainable future for independent local journalism
As New Zealand moves from crisis to recovery mode the need to support local industry has been brought into sharp relief.
As our journalists work to ask the hard questions about our recovery, we also look to you, our readers for support. Reader donations are critical to what we do. If you can help us, please click the button to ensure we can continue to provide quality independent journalism you can trust.