Why Indian restaurants pay their chefs $4 an hour

19:57, Jun 25 2013

The popularity of Indian restuarants in New Zealand is only beaten by their abusive treatment of employees. The media hasn't yet identified the restaurant chain that pays its staff $4 an hour - against the legal minimum of $13.75 an hour - but there are plenty of restaurants that pay even less.

Indian chef Gajendar Singh was forced to work every day for nine months at Plaza India in Masterton, and was paid a shocking $50 a week. His employer also refused to hand back his passport and threatened to blame him for burglary if he left.

Chefs Akbar Singh and Bashan Singh, who worked at Curry and Spice restaurant in Whangaparaoa, were beaten up and held captive when they quit their jobs. Both were hospitalised - Bashan with his legs fractured.

But at least they were compensated - more than $70,000 in damages and legal costs of nearly $21,000. Most don't even get to tell their side of the story.

Good Indian vs bad Indian restaurants

Greesham's Law states that bad money drives out good money from circulation. Apparently, the same holds true for restaurants. Ram Rai was one of the good guys who had to quit the Indian restaurant business because he couldn't compete with those who refused to play by the rules.

The genial Rai, who comes from India's Konkan region - famous for its vegetarian cuisine - not only owned an Indian restaurant in the tiny suburb of Mission Bay, he also achieved backward integration with a factory in East Tamaki, which produced Indian food for Auckland's leading supermarkets.

However, Rai - who now lives in Australia - had to sell his business because he couldn't keep in step with those who paid their employees ridiculously low wages under the table. These wages range from $4 to $8 an hour, against the legal minimum of $13.75 an hour.

Demand vs supply

Any skill that's in high demand would translate into high wages and special perks for the industry's professionals. However, in New Zealand, the high demand and low supply of Indian specialist chefs actually makes their life hell. This is counter-intuitive but here's why it happens.

Since there are no Indian chefs being trained in New Zealand, the only way an entrepreneur can open an Indian restaurant is by getting someone from India.

First up, the restaurant owner places an advertisement in a local or national newspaper in India, offering the opportunity to work in a ''foreign country'', with wages being paid in dollars, plus free lodging and meals. Plus, qualified chefs can apply for residency after satisfying certain Immigration New Zealand requirements.

Now these baits wouldn't entice a chef working in a reputable Indian hotel. But for someone languishing in a small-time outlet, perhaps in a small town with few prospects for advancement, this is too good an offer to refuse. As they say, there is an idiot born every minute, and two to dupe him.

Another big dolly is the conversion rate. The New Zealand dollar buys around 45 Indian rupees, so a quick mental conversion suggests the overseas stint will make the chef a millionaire in just two years - which is the maximum length of a work visa.

Plus, if the residency permit comes through, there's the promise of a new life for the chef's family. This is, of course, the much talked about New Zealand dream - the tension-free lifestyle, the beaches, green countryside, holidays to Europe and Rarotonga. Immigration New Zealand's travel brochures clearly play a part in painting an overly rosy picture.

As New Zealanders themselves would agree, the New Zealand dream happens only in your sleep. Like in most countries, people here too work hard for a living. Why would a chef from India discover riches in this land that most locals haven't?

Also, while it is a fact the average New Zealander has a better standard of living than the average Indian chef, that isn't the real picture. What a rupee buys in India, a dollar cannot buy in New Zealand, which because of its small population is by default a high cost economy such as Dubai.

The bribe

The whammy hits even before the chefs leave Indian shores. In some cases, they are told the company is offering them a once in a lifetime opportunity to start a new life in a new country.

It's you scratch our back, we'll scratch yours. In exchange for the trouble of getting them work and residency visas, and for completing all other formalities, the chefs have to dish out upwards of $50,000 to the restaurant owners.

The $4 an hour sweetener is over and above this.

Are Indian restaurants fronts?

Some surely are. How else can they keep offering the $6.50 lunch deal, which they first introduced 10 years ago? The Chinese restaurants - at least the decent ones - have jacked up their rates, so what keeps prices low in Indian restaurants?

Also, a number of Indian doctors and dentists have jumped on to the curry train. Since these guys aleady make a lot of money as GPs and surgeons, it just shows how much illegal cash can be pocketed in the Indian restaurant business.

Back-of-the-envelope calculations suggest that if a restaurant hires just two chefs a year and takes $50,000 each from them, the owner has already made a tax-avoiding profit of $100,000 before a single plate of butter chicken is sold. Any money they make over and above this pays for the rent and other expenses.

Some restaurants hire more chefs, but two would be the right number for not alerting Immigration to these high stakes shenanigans. The Indian restaurant business is, therefore, an excellent avenue for making a quick buck on a small low-risk investment.

Welcome to slave labour

The chefs are in for a rude shock the very day they land in New Zealand. Their accommodation is probably just a cold dorm shared by 10 others. They might have to shell out a few thousand dollars to buy a used car to able to get to work. And they work not 40 hours a week and five days a week as the law says, but 70 hours a week, six days.

The manager of a leading Indian restaurant chain confided in me that he worked 90 hours a week. I thought it was weird that he made it sound almost heroic. But he quit after a couple of years and is now back in Punjab, India.

Basically, it's leave it or lump it. To be sure, after forking out such huge amounts of money (most likely borrowed from relatives and friends) the chefs are likely to lump it.

For, there is not much an employee can do. He has already paid the restaurant his lifetime savings, he's in a strange city, he has no contacts, and worse, the owner is holding on to his passport, illegally of course but the chef doesn't know this. He's told that if he so much as talks to the police or other authorities, the owners will withdraw their sponsorship.

The owners thus have a huge advantage over the chefs who are down on their luck, money and time.

Time is a huge factor because if the chefs are not able to get their visas extended, they can't stay on in New Zealand. And if the restaurant turns hostile, Immigration will ask them to leave. Case closed. Dream over.

Feudal mindset

I asked the owner of an Indian restaurant if the treatment of chefs in Indian restaurants in New Zealand is as bad as it is alleged to be. In turn, she asked me a rhetorical question: ''Is the attitude of Indian chefs towards their owners fair?''

I changed direction and asked her how she treated her employees. She said she was like a parent to her chefs. So was she a bit bossy? She was evasive: ''I'm friendly, I'm bossy, I'm everything."

What if one of her chefs quit and joined another restaurant? She didn't waste time dilly-dallying on this one. ''Then I'll show them my other side,'' she chewed out the words, like a female Jack Nicholson.

Clearly, she is the one with an attitude problem. It's no surprise that the restaurant has changed hands more times than anyone can remember.

Ironically, such a slave-owner relationship is not common in India (where you would expect it) but happens in New Zealand with its far more tougher labour laws. For, in India they can hop restaurants any time they want whereas in New Zealand the immigration department places total power in the hands of the owners and then walks away.

Sadly, some Indians still carry a feudal mindset. Since middle class Indians are used to having servants, they assume - wrongly of course - that their employees are their servants. There can't be any other explanation for their attitude towards their employees, who aren't even allowed to quit their jobs. This is naked slave labour.

No justice

The trouble with the New Zealand justice system is that it hands down inadequate sentences to offenders. The system works great for child abusers and also for Indian restaurant owners. In the Whangaparaoa assault case, the jail term for the owner was just two years. He appealed and the sentence was reduced to 18 months. Another co-accused's sentence of 12 months jail on the same charges was reduced to six months home detention.

Way out

The immigration department has a huge role to play in this messy affair as it makes it difficult for legitimate, well-paid chefs to come here. That leaves those at the margins of the hospitality industry in India to become targets of these poachers, who promise them streets paved with gold.

Since New Zealanders have an insatiable appetite for Indian food, which explains the rapid spread of Indian restaurants even in sleepy Auckland suburbs, there is a very good case for making it easy for legitimate chefs to come here, work for a few years, and then leave with substantial savings. This will also enable the New Zealand taxman to make up for the millions in lost tax revenue.

Currently, the ones who benefit are the modern day slave owners who run Indian restaurants in New Zealand.


Rakesh Krishnan's articles have been used as reference at Rutgers, The State University of New Jersey; the Centre for Research on Globalization, Canada; Wikipedia; and as part of the curriculum at the Anthropology Department of the National University of Ireland, Maynooth. His work has been published by the Centre for Land Warfare Studies, New Delhi; Oped News, Pennsylvania; and Rossiyskaya Gazeta Group, Moscow, among others.