Immigration December Newsletter

In this edition:

Consultation on migrant exploitation

The Ministry of Business, Innovation and Employment (MBIE) welcomed feedback and proposals for the temporary migrant worker exploitation review initiated in October 2019.

Based on the research conducted by the MBIE, it is indicated that there are around 450,000 migrant workers in New Zealand and they suspect that an unknown number of these migrant workers are possibly at risk of, or currently, being exploited. This follows on from the Labour-New Zealand First coalition agreement, which sought to put migrant exploitation, particularly of international students, at the forefront of their immigration policy. Therefore, the focus on reducing migrant exploitation is a priority for the MBIE and aligns with the future framework which requires all employers to achieve accreditation status first, before being permitted to support employees for closed “employer-supported” work visas.

The consultations ended on 27 November 2019 and the current proposals will span three areas:

  1. Prevent

MBIE has conceded that the proposals for the “prevent” aspects, which are targeted at addressing underlying issues which may contribute to worker exploitation, are still in their early stages.

The Government aims to increase liability for stakeholders or external parties who may have an influence on an employer, and may therefore contribute to migrant exploitation. There is acknowledgement that businesses in practice often operate at multiple levels and this can be used to conceal or enable exploitation.

One proposal is to prohibit banned people, such as those convicted of exploitation offences, from becoming company directors or taking executive roles in a business by expanding on the provisions currently available under the Companies Act 1993. This would potentially minimize risks of having individuals convicted of these offences subsequently establishing a new company in order to continue their exploitations.

  1. Protect

The focus on this will be to provide pathways for existing temporary visa holders to more easily leave employment in which they have been exploited in.

This will involve the establishment of an 0800 phone line and online reporting avenues, allowing migrants to call through and inform INZ of any potential exploitation. The MBIE will also look into training a specialized team to deal with these reports and developing a system to be able to triage, consolidate and verify information provided through these platforms for greater oversight.

In addition to this, INZ is proposing to offer a bridging visa for exploited migrants to be able to remove the specific conditions on their work visas. Alternatively, there may be the option to make discretionary determinations in granting new visas for victims who report on exploitation, depending on their circumstances. These will offer a pathway for migrants to be able to leave their current employer and seek alternative work, therefore providing them more incentives to leave exploitative employment and report mistreatment.

  1. Enforce

To further deter possible exploitation and non-compliance with employment standards, MBIE proposes to introduce and implement harsher penalties for proven offences. This would possibly include introducing more minor infringement offices and fees for lower level breaches such as failing to provide required documentation to demonstrate compliance, allowing employees without the requisite work rights to work or paying a salary less than agreed to in the visa application.

There is also interest in expanding the list of offences which may result in an employer being “stood-down” and therefore unable to support migrants for visas, and improved dissemination of the stand-down list to migrant workers to ensure they are well-informed.

The overarching goal of targeting, preventing and deterring migrant exploitation is to better protect the affected individuals and their families, as well as compliant employers who may be adversely affected by non-compliant competitors and the international reputation of New Zealand as a safe and secure place to reside and work.

New capital requirements on banks and the implications for immigration compliant investment

On 5 December, the Reserve Bank published its final decision on the review of the capital adequacy framework for registered banks in New Zealand. The intention of the new requirements is to help prevent systemic financial risk; in the long term, a stable financial system can have positive externalities for the broader economy. However, in the short term, transitioning to this new framework may increase banks’ costs.

Under the new requirements, banks need to contribute more of their own money (equity) for every dollar they lend out. Given that equity is the most expensive form of funding for banks, the cost of that funding has the potential to be passed onto customers, in the form of lower deposit rates and higher loan/mortgage rates. It is also likely that bank shareholders shoulder some of the cost too, through the possibility of lower dividends and/or capital raisings.

One change the Reserve Bank has allowed is the ability for banks to issue redeemable preference shares to count as capital. Preference shares sit between common stock and bonds. They pay a fixed dividend, just like a fixed-rate bond pays a fixed coupon, but carry risks similar to a common stock. Should a bank get into difficulty, its capital value would be used to absorb any loss. The structure of the preference shares are yet to be confirmed, but they are not expected to be able to convert into common stock. Under normal circumstances, its price movements may be affected by changes in credit spreads, and depending on the structure of the preference share issue, its price movement may also be affected by movements in the price of the bank’s common stock. If banks issue preference shares in the NZ market, from an immigration compliance investment prospective, they are highly likely to be counted as ‘growth investment’ for immigration purposes1.

Immigration investors may hold bank bonds of various rankings in a portfolio. Tier 1, Tier 2 and senior bonds are not counted as ‘growth investment’ for immigration purposes. Tier 1 and Tier 2 bonds also carry the risk of loss absorption if banks get into trouble, which could result in capital write down or those holdings being converted into common stock. To compensate for this risk, these bonds normally have higher yields than senior bonds. Importantly, we do not expect local banks to get into difficulty. However, existing Tier 1 and Tier 2 bonds are likely to be repaid at their first call date because of these Reserve Bank changes

Growth investments are acceptable investments, except for: bonds, and philanthropic investments. For the purpose of growth investments, convertible notes are considered to be bonds.


Article provided by Ally Cui – Director, JB Were.

New Zealand economic outlook for 2020

Economists generally expect the New Zealand economy to expand 2.4% in 2020, which is up 0.1 percentage points from last month’s estimate, and 2.5% in 2021.

New Zealand’s economic activity regained some steam, after external headwinds and an ebbing construction sector prompted a slowdown in the second quarter.

Sturdier retail sales in Q3 reflect consumer spending has strengthened despite downbeat business confidence and conditions.

Growing consumer optimism in October-November and surging business sentiment in November suggest the economy may have turned a corner.

Meanwhile, the government revealed plans to boost infrastructure spending significantly. Growth is projected to remain stable next year.

The external sector will lose strength, as export growth will soften and a firmer domestic economy will boost import growth.

Enterprise Recruitment

Enterprise Recruitment have over forty years’ experience in the New Zealand market place and have strong networks throughout the country.

We offer a complimentary CV review and feedback on your employability in the New Zealand market.

We can be contacted via Steve Baker on +64 27 212 5483 or

Enterprise Recruitment wish everyone a safe and Happy Christmas and look forward to 2020 with optimism.

New Zealand remains a destination of choice for candidates exploring new lives and career opportunities.

I look forward to again assisting any candidates who want an appraisal of their chances of employment throughout New Zealand.

Merry Christmas and Happy New Year.

Christmas and New Year Closure period

The festive season is approaching and Immigration New Zealand will be closed over a certain period during this time. Therefore, particular care and attention should be paid to ensure that applications are submitted in a timely manner and any possible delays can be accounted for as required.

The official 2019/2020 closure period for Immigration New Zealand’s branches is from Wednesday, 25 December 2019 until Friday, 3 January 2020.

The Immigration Contact Centre will be closed from Wednesday, 25 December 2019 until Wednesday, 1 January 2020.

Lane Neave will be closed from 5.00pm Friday, 20 December 2019 and will fully reopen at 8.30am on Monday, 13 January 2020. Over this closure period, the Immigration Team will be operating a “skeleton” staff for urgent matters. Therefore, please do get in contact with us if you need assistance during the holiday period.

We wish everyone a healthy, safe and happy festive season.

For further information or assistance with emigration please contact Lane Neave Lawyers on + 64 3 379 3720 or email

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