How Indian slaves corrupted New Zealand’s labour market

Via Stuff comes a great expose of how Indian slavery arrived in New Zealand.

Over two years, a growing number of young Indian men have come forward alleging exploitation by their employer. Why does this keep happening? National Correspondent Steve Kilgallon reports.

In 2016, at the height of an export education boom, 11,024 Indians came to New Zealand on student visas.

Most came from the remote, rural Sikh-majority Punjab province, lured by promises made by unlicensed education agents and illusory sales pitches by tertiary institutions and our government that New Zealand offered a straightforward “pathway to residency”.

The students brought money, in student and visa fees, but many found the promised “pathway” anything but straightforward.

For two years, Stuff has published an ever-growing catalogue of stories exposing the routine exploitation of young Indian students, often by more established Indian migrants. There has been repeated tales of being paid $7 an hour; working more than 80 hours a week; denied days off, holidays and sick days; of paying “premiums” of up to $40,000 for a job.

Bhavdeep Singh, who still hasn’t attained residency after five years of hard and allegedly exploitative work in a Rotorua liquor store, is scornful.

“Because the Government needed so much money, they got a huge amount of students without ILETS [English language qualifications] and other proper documents – so when they needed us, they can bring us without proper investigation,” he says. “Now when we need them, they are breaking [promises].”

A report commissioned by the Ministry of Business, Innovation and Employment (MBIE) in 2019 identified Indian students as the most vulnerable group for migrant exploitation, calling them a “pool of workers unscrupulous employers can exploit” and saying some employers specifically targeted such students.

So why are so many young Punjabi Sikhs exploited – and who is to blame?

The agents

The story starts at the Partition of India by the British in 1947, when the Punjab region was carved between Pakistan and India and the province’s Sikh majority began to suffer a half-century of discrimination.

Punjabis began to emigrate – to the US, UK, Canada and Australia – a flight accelerated more recently by skyrocketing land prices in a fertile region which covers just 1.5 per cent of India’s landmass, but provides much of its food. Previously poor farmers were enriched and able to send their offspring offshore, particularly those who had no interest in working in agriculture.

Experienced immigration advisor Malkiat Singh, for example, had that experience: after completing a mechatronics degree, his choice was a big city, or overseas.

“Parents will say, ‘If you are going away from us, you may as well go overseas and earn better.’ It’s quite a common belief that… the further away you go, the better the opportunities.”

First stop for these wanderlusting students is an education agent. Half of all overseas students arrive here via an agent. And while immigration agents in this country must be licensed, offshore education agents are not. That means there’s no regulation of the promises they make.

The MBIE report – produced by Waikato University’s Francis Collins and Auckland University’s Christina Stringer – describes these agents as “sell[ing] them a dream of obtaining permanent residency… the reality is different and many find it difficult to obtain a job and thus they become vulnerable to exploitation”.

Students will often borrow against land or homes to finance their study, but in some cases, says Malkiat Singh, agents construct sophisticated financial arrangements to skirt Immigration NZ inquiries into students’ finances.

In 2017, Immigration NZ (INZ) cancelled 400 visas (including those of nine students who took sanctuary in an Auckland church) after agents submitted fraudulent financial paperwork.

Singh says agents target unworldly Indian students in their late teens.

If a student were to question, or even ask to look at that paperwork, says immigration lawyer Alistair McClymont, the agent would simply throw them out.

The Indian class system means that usually, a student wouldn’t dare question the promises made to them by an agent or a New Zealand education establishment, explains McClymont, who has worked with Indian migrants for 20 years, has a degree in Indian history and is married to an Indian woman, his business partner Aakanksha.

The agents, says Malkiat Singh firmly, “are the root of the problem. They tell them everything is easy… that life will be easy.”

The education

Tertiary education recruitment from India has reached such an extent that many business courses will have an entirely Indian cohort. Some, says McClymont, will have a Hindi translator in the classroom.

Students are typically steered into level 5, 6 and 7 business diplomas, which can be later cross-credited to the first year of a bachelor’s degree.

Harman Singh, for example, arrived in 2013, inspired by cousins who had moved to the US and Australia. His lawyer told him he would be a permanent resident within two years: he still hasn’t got residency. In India, he’d studied automotive engineering, and would have preferred to study an engineering degree here. Instead, he says, he was “ignored” and enrolled in a worthless business course.

McClymont says those courses have “zero value – you won’t find any Indian students who will say these diplomas have any value in the Indian labour market”, where post-graduate degrees are highly valued and competition is fierce.

Bhavdeep Singh laughs at the business courses he studied. “The education I was getting here I can compare to like my tenth grade school.”

It’s a hidden world. McClymont says his local friends are “oblivious” to the issue of migrant student exploitation, because in their mind, an overseas student is someone studying a short course in English language, or an engineering master’s degree at Auckland University.

It fits with the politicians’ rhetoric of “quality qualifications” on offer to our overseas students. McClymont says that’s hideous hypocrisy.

Even if students do realise their course is worthless, INZ rules make it difficult for them to change path after arrival in New Zealand.

Some institutions appear complicit in gaming the system: while students are capped at 20 hours work per week, the MBIE report says some cram full-time courses into two days a week so students can work longer.

Once the students start study, Malkiat Singh says they find themselves in a bubble – “and the rules of exploitation have already started”. Those who flat with Kiwis, he says, are likely to stay away from exploitation and find legitimate jobs.

“But those who keep living with their countrymen acquire a set of beliefs of failure and that success is not possible and this [being exploited] is the only way to get residency.

“They undergo conditioning from the moment they arrive. The first thing they hear is ‘you’ve chosen the wrong country’, the second thing is ‘you have chosen business, you are doomed, nothing will happen out of it’.”

Most, he says, do nothing to break the cycle until it’s too late, when their final visa is expiring. “They should be aware of this on the first day: if you go into this cycle, you won’t get anywhere. You will just have regrets.”

The job

The Indian students who come here tend to be poorer than from other countries, study at lower-quality establishments and need employment quickly, and so will accept poorer conditions.

Desperate for work, they are steered towards the late 1980s-early 1990s wave of Punjabi migrants, some of whom are exploitative employers. This group tended, argues McClymont, to be hardworking, entrepreneurial and forced to set up their own businesses as a result of their inability to break into the labour force by a “very discriminatory labour market [then] where Kiwi employers wouldn’t even look at an Indian name on a job application, regardless of their skills or experience”.

That wave of migrants also tended to be exploited by even earlier arrivals, working long hours for below minimum wage – but they also saw that work as an opportunity. One couple McClymont knew, for example, paid their way into employment on arriving here, were now successful in business on their own account, and considered the former boss who had exploited them to be a friend, because he had given them a foot in the door.

McClymont has been enraged by successive National and Labour immigration ministers talking of students exploiting the pathway to residence, when he’s seen INZ and Education NZ use that very terminology. “The hypocrisy is just unbearable,” he says.

“All these students come here believing the roads are paved with gold, they invest money and realise they have been lied to – by the government, by Education New Zealand, by the schools and by the schools’ agents,” McClymont says.

“The only way they can get a return on that investment is borrowing more money to pay an employer, or to work long hours or work for $7 an hour… and a lot of them are incredibly grateful. The employers know this, and think they are doing these guys a favour, because while the Government has failed them, they are allowing these guys a pathway to residency.

“They believe they are doing them a favour – but if they’ve got money in the bank and a $3m house then they should give them a break.”

Emails to Stuff from some members of the Indian community and postings online reflect this view, questioning the complicity of exploited students in their work arrangements.

Just as a student wouldn’t question their agent or teacher, they struggle to challenge their older, more successful employers, McClymont says. And in the hyper-competitive Indian domestic labour market, they are used to the concept that you need contacts and a willingness to work for virtually nothing to get a start.

When he first arrived in New Zealand, Malkiat Singh worked for $6 an hour in a supermarket. He saw the owners sponsoring a Diwali festival, and felt they were buying popularity with the money saved on his labour. Exploited workers see the success their employers enjoy and “almost get reconditioned that this is the way it works. They develop a certain worldview where it becomes the norm: to win in business, you have to do these things.”

Singh also points to what he says is a heavily ingrained notion in Indian society of delayed gratification: if you work hard, the rewards will come. A migrant desperate for residency can be easily convinced that working 80 hours a week for $7 an hour is worth it, if they can secure that stamp in their passport.

The shame

But once a migrant realises they are being exploited, or resolves to do something about it – usually when their treatment worsens, or promises around visas aren’t kept, or employers are ready to move on to newer, more malleable arrivals – there are powerful factors which stop them acting.

One is shame. Families at home who’ve sold or borrowed against land believe in their children’s success “like a fairytale coming true… if I send my son to New Zealand, my life will be easy”, says Malkiat Singh, and have an expectation of remittances and improved social status.

Tens of thousands of dollars in the hole, a debt they could never repay working back home, their offspring can’t face walking away.

Bhavdeep Singh, for example, says it took him two years to tell his NZ-resident sister of his own exploitation, so “imagine how many other guys are unable to talk”, he says.

“It is embarrassing: Today I would have to tell people I spent $30,000 to come to New Zealand to work for five years for $10 an hour and not earn anything. Now I have to start again.”

Harman Singh agrees returning home is not a welcome prospect for most.

“It would be shameful,” he says. “A lot of your family members would blame you – they would think, ‘If he had worked hard over there he wouldn’t be coming home.’”

But would you be celebrated if you returned with a New Zealand passport? “Definitely,” he says. “It is a very big thing for us, getting a New Zealand passport.”

The carrot

That’s the carrot that dangles before a migrant: because residency frees them from the grip of an exploitative employer and offers the chance to join the world of legitimate work.

The MBIE report says the Indian students’ particular vulnerability is partly because they have staked everything on securing residency. And a gaping flaw in the “skilled migrant” category of New Zealand’s visa system offers a glimpse of success.

McClymont says it is virtually impossible for a young Indian student migrant to turn work at a big corporate employer into a residence visa. So they have become skilled at finding the niches – and the current one is being a “store manager”. That means the manager of a tiny bottle store with one or two employees and making a profit of $40-80,000 a year qualifies for a visa.

The Government, seeing this, has brought in salary thresholds: $52,000 is the minimum, and $79,000 automatically makes you “skilled”. But McClymont says that has simply increased the illegal “premium” paid by employees for their jobs to cover this salary hike.

Bhavdeep Singh believes that policy in particular pushes Punjabis to strike illegal deals to secure visas. And that means the education market has created its own niche labour market of jobs staffed solely by migrants: bottle stores, horticulture, gas station nightshifts.

It has even created its own sector of commerce: tiny bottle stores that wouldn’t otherwise exist. McClymont has seen the balance sheets of some and he says a typical gross profit of $80,000 a year is returned only because of cheap or unpaid labour and employee “premiums”. Run straight, they would only break even.

The blame

“I think I can blame my own community, but most of the blame I give to the Government,” says Harman Singh, who alleges that for years he was exploited by a fellow Punjabi, bottle store owner Ravi Arora.

“Every student who comes from overseas spends 30 grand on their studies – and nobody is going to spend that if they’re not going to get residency at the end.”

Both he and Bhavdeep Singh, who’ve taken employment court actions against their former employers, are angry that the residency rules keep changing, pushing the dream further away.

While the present Government has attempted rule changes to make exploitation more difficult, it has continued promoting a pathway to residency that for many, doesn’t realistically exist.

McClymont says if you get a job with a good employer with a good corporate structure and values, the sort that often goes disregarded by our immigration rules, then “100 per cent without doubt, you will be a successful migrant”.

The government itself says 40 per cent of the liquor store industry is breaking the rules but seems reluctant to address it specifically.

It could increase the number of labour inspectors; prevent mediated settlements between exploiter and exploited containing confidentiality clauses; increase sanctions against the exploiters; and use banning orders more often.

The Alcohol Regulatory and Licensing Authority made a decision in 2018 which declared that exploiting your workers doesn’t make someone unsuitable to hold an alcohol licence. That decision, to date, has made removing liquor licences from exploitative owners difficult.

Then there are offshore education agents, which the government could require to be licensed. It could also make course providers in New Zealand do more to prove their worth.

Beyond the Government’s control are the suppliers to exploitative bottle store owners. They could refuse to sell to these stores. Of course, there will likely always be another supplier with less of a moral conscience, but it would at least make matters more difficult.

To shut the door entirely to these students would cost the country billions, says McClymont.

“But if you’re going to promote a pathway to residency, then have a genuine pathway to residency, rather than one where you have to be exploited.”

Without changes, the 5607 Indian students who arrived in 2019 will have just as sad a story to tell about their Kiwi experience as their predecessors.

“If the [Government] are taking in students, they have to think of their futures too – not just the money you are taking from them,” says Bhavdeep Singh. “If you can’t afford to settle that many students, why are you taking them in?”

The only difference to Australia is that it is worse, much more widespread and across a variety of cultural groups.

David Llewellyn-Smith
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  1. Well here is the money quote.

    “Every student who comes from overseas spends 30 grand on their studies – and nobody is going to spend that if they’re not going to get residency at the end.”

    • Shades of MessinaMEMBER

      Might be more palatable if an enterprising educational institute could lease a cruise ship, on-board refugees in a loop around Iran, Sri Lanka, India, Malaysia etc and charge them $30k to study courses on the voyage to Australia. Then when they land in Australia they are classified as “students” and not “illegal immigrants”.

      Money is diverted to a “world leading institute” rather than people smugglers and tax is paid on the earnings (potentially). The cost of running concentration camps, state sponsored torture and sea patrols to the taxpayer are also decreased dramatically.

      Wins all round !.

    • And it doesn’t stop there.
      Our local courier is off back home to get married after his studies here (and residency status no doubt), so there’ll be even more money to flow in from 2 sets of parents?
      “If you have an adult child who is a New Zealand citizen or resident, you can apply to live in New Zealand permanently. You’ll need an annual income of NZ $60,000 plus NZ $1 million to invest for 4 years, and another NZ $500,000 to live on. Once you’ve completed the 4-year investment period, you’ll be eligible for permanent residence.”
      From past observation there’s quite a cottage industry in pass-the-parcel of ‘assets’ from one party to another to satisfy those requirements.

      • And pays off that study debt by working in NZ or Australia, and sending back money to India to pay off the debt plus accrued interest. So not an export after all.

    • The90kwbeastMEMBER

      Boom! So how does that align with intl. students being counted as an export? And over what timeframe? Does the ABS adjust prior period ‘exports’ when the students that supposedly led to those figures registered actually in turn never leave?

      What a sham.

      • Such study shouldn’t be counted as an export if study debt is ultimately payed back from earnings made in Australia or NZ.

      • The90kwbeastMEMBER

        Isn’t it actually worse than this too, because not only is the only component that could possible be counted as an export the amount of money imported when they first arrive (assuming the rest is earned here – so NOT an export), it is well documented that many intl ‘students’ send remittances based on their local earnings back to India?

        So isn’t this, over time, a negative export and actually adding to the Current Account Deficit?

    • You’re only a slave if you weren’t prepared to do what it takes to get permanent residency.

    • Yes Tezza if you were drunk and left your main door and garage door open and left the car keys on the couch and someone drove away with your car it is not your fault 🙂

  2. Do you know the name of the hero of that movie that you have on your pic ?? He’s is very famous and popular and so is the slavery and those elites who benefit from that slavery.

  3. Pffffttt…. because regular Australian born Aussies have not become slaves to Global Neoliberal Capitalism and Neo Marxist cultural ideologies?
    It’s all a matter of degrees.