Opinion - How the Accredited Employer Work Visa Opened the Door to Unprecedented Scrutiny

When the Accredited Employer Work Visa (AEWV) was first introduced, it was seen as a crucial solution for businesses facing labor shortages in the wake of COVID-19. The scheme promised to streamline the process for hiring skilled migrants, offering businesses a faster and more efficient way to fill critical roles. For employers, it seemed like a win-win: rapid recruitment without the usual bureaucratic hurdles.

What many businesses didn’t anticipate was the level of scrutiny that would come with accreditation. Like a Trojan horse, the AEWV brought unexpected consequences, allowing Immigration New Zealand (INZ) unprecedented access to inspect and audit businesses, revealing vulnerabilities in areas beyond just immigration compliance.

Initial Influx under AEWV and Misuse

Naturally New Zealand was eager to rebuild its economy post-pandemic resulting in an influx of migrant workers to meet demand. This rush led to widespread misuse of the scheme by some employers. Reports soon surfaced of businesses selling job tokens to migrants desperate to enter New Zealand, while others found ways to skirt compliance requirements, hiring workers under false pretenses or paying them below the legal wage. This early misuse exposed cracks in the system, leading to worker exploitation and a growing awareness of the risks involved.

An independent review of the AEWV acknowledged that the push to reduce visa processing times exacerbated these problems, as risk assessments were either insufficient or delayed. INZ has since tightened controls and increased scrutiny, but this has come at a cost: longer processing times and heightened oversight.

With initial processing times as short as 2 weeks to 1 month for the earlier applications, businesses are now experiencing significant delays across all of the AEWV processes. The increased scrutiny and tighter checks introduced in mid-2023 (and more recently in April 2024) have created a bottleneck, leaving employers in limbo as they wait for approvals.

For businesses that rely on a steady flow of workers to maintain operations, these delays cause considerable stress with some employers struggling to comply, caught between desperately needing labor and supporting workers who have no income while awaiting their visas.

Beyond the delays, employers continue to face ongoing audits from INZ. These impact everything from payroll systems to health and safety records, often catching people off-guard and leading to unexpected fines, infringements, or even the suspension/revocation of accreditation. Since April 2024, $196,000 worth of infringement notices have been issued for non compliances. Undoubtedly, a lot of employers would have also received 'educational warnings'.

Gaps in Employer Knowledge

While many employers rushed to become accredited, they did not fully grasp the obligations they were taking on. The focus was on addressing immediate staffing needs which overlooked the long-term compliance burdens that come with accreditation..

Businesses quickly discovered that their internal systems were never equipped to handle the full scope of INZ’s compliance requirements. This led to operational disruptions as companies scramble to catch up. Sadly some employers have given up swearing never to become accredited again.

Exploitation Claims

With the complexities of compliance, another issue emerged: the rise of exploitation claims. Under the Migrant Exploitation Work Visa scheme, workers who allege exploitation are granted an open work visa while INZ investigates. This visa is intended to protect vulnerable workers, but it has also created a loophole for some.

While many workers do have legitimate concerns, however there have been cases where employees collude to falsely accuse their employers of exploitation as a way to extend their stay in New Zealand. The allegations do not need to be proven immediately—once a worker claims exploitation, they receive a visa, leaving employers to bear the burden of defending themselves in long, costly investigations. Even if the claims are unfounded, the damage to the business, both financially and reputation wise, can be substantial.

The Review Findings

Te Kawa Mataaho’s review of the AEWV outlined the scheme’s strengths and weaknesses, acknowledging the immense pressure INZ was under to process a high volume of visas post-reopening. This pressure led to decisions being made without proper risk assessments, resulting in significant compliance gaps and the risk of migrant exploitation.

The review provided 10 recommendations to address these shortcomings:

1. Stronger Risk Assessment Processes: INZ should implement more rigorous risk assessments during visa processing to prevent exploitation and misuse.
2. Improved Employer Accreditation Checks: Accreditation requirements should be tightened, with more thorough vetting of employers.
3. Enhanced Monitoring and Auditing: INZ should increase the frequency and depth of audits to ensure compliance.
4. Better Support for Migrants: Clearer channels for reporting exploitation and accessing support should be provided.
5. Faster Processing Times: INZ must reduce delays while maintaining compliance standards.
6. Training for INZ Staff: Frontline staff should receive more training to handle complex cases.
7. Increased Transparency: Communication with employers and migrants must improve.
8. Strengthening Leadership Accountability: INZ leadership should ensure risk management processes are followed.
9. Clearer Compliance Guidelines: Employers need better guidance on meeting AEWV obligations.
10. Ongoing Review and Improvement: The AEWV scheme should undergo continuous updates to address emerging challenges.

The review acknowledged that INZ has already made changes to tighten the system, which has contributed to the longer processing times and more detailed checks that employers are now experiencing.

The Advantages of Heightened Scrutiny

There are some advantage to the heightened scrutiny:

1. Improved Compliance: The increased audits have forced businesses to remain compliant with immigration and employment laws, reducing the risk of future breaches.
2. Fairer Workplaces: INZ’s thorough oversight has improved conditions for both migrant and local workers, raising standards across industries.
3. Enhanced Reputation: Compliant businesses are viewed as responsible employers, enhancing their standing with both clients and potential employees.
4. Mitigation of Long-Term Risks: By staying compliant, businesses avoid fines, legal action, and the suspension of their accreditation, ensuring more stable operations.

 What Can Businesses Do?

In this environment, businesses must be proactive to avoid the challenges of the AEWV Trojan horse. Here are a few steps employers can take:

1. Strengthen compliance systems: Ensure payroll, contracts, work rights information and health and safety protocols are audit-ready.
2. Respond quickly: Provide information requested by INZ in a timely manner.
3. Stay informed: Keep up with immigration law changes and INZ’s updated compliance requirements.
4. Keep good records: This includes business records, visa records and anything else relating to your business.
5. Document as much as you can: This will be important if you are fighting a non compliance or exploitation allegation.

Conclusion

The AEWV, introduced to address labor shortages, has evolved into a complex, compliance-heavy regime that grants INZ unprecedented access to the inner workings of businesses. Like a Trojan horse, it has brought hidden challenges, exposing employers to increased oversight, longer processing times, and the risk of exploitation claims.

Employers must be vigilant, fully understanding their obligations and preparing for the scrutiny that comes with accreditation. Only those who are proactive, well-prepared, and informed will be able to benefit from the scheme without falling victim to its hidden pitfalls. In today’s regulatory landscape, heightened awareness and sound legal advice have never been more critical.

If you would like more information or advice on this matter, please contact our immigration expert Hetish Lochan at [email protected] or call our office on 03 441 2743.