Penalties for exploiting migrant workers will be expanded to cover those on temporary work visas, with punishments to include lengthy jail time, fines and possible deportation for employers who are themselves migrants.
Immigration Minister Michael Woodhouse said the measures would make it clear that unlawful and exploitative behaviour would not be tolerated.
"I plan to amend the Immigration Act to make it a specific offence to exploit migrants who hold temporary work visas," Woodhouse said.
"The proposed penalty will reflect the seriousness of the offence - imprisonment for up to seven years, a fine not exceeding $100,000, or both," he said.
"Unlawful migrants are already protected by the act in this way and it is only right that lawful migrants have the same protections."
As signalled to a select committee last week, Woodhouse said he also planned to make exploitative employers with residence visas liable for deportation if the offence was committed within 10 years of gaining residence.
There were an increasing number of cases where crooked employers were themselves migrants, taking advantage of vulnerable people from their own community, he said.
The law changes would likely be introduced by August.
Changes had also been made to encourage victims of exploitation to come forward.
In cases of serious workplace exploitation, migrants who came forward would be allowed to remain in the country while they applied for a new visa.
In a parallel move, Labour Minister Simon Bridges is looking at ways to improve the enforcement of minimum employment standards as part of a government-wide push to combat the exploitation of migrants.
The Council of Trade Unions welcomed the move to penalise employers of migrant workers and give workers who complained greater protection.
CTU secretary Peter Conway said employers who ran a business based on exploitation of migrants needed to face the consequences.
"We will need to ensure that the measures announced today are effective as there still appears to be plenty of room for discretion."
Recent moves to ensure better treatment for fishing crew on foreign charter vessels, and a major prosecution against a restaurant chain employing migrants on about $4 an hour were signs the long-awaited crackdown was happening.
But Conway said the Government was undermining positive moves for migrant workers by removing rights from all workers, such as through the 90-day probation law and reductions to collective bargaining rights.
Labour immigration spokeswoman Darien Fenton also welcomed the changes announced by Woodhouse but said they would require more resources.
There were only 35 labour inspectors covering the whole country and just one dedicated immigration officer in Auckland.
"Unfortunately crimes against vulnerable migrant workers will continue without sufficient inspection and enforcement." Fairfax NZ
- Fairfax Media
Do you feel better or worse off than a year ago?Related story: Election jitters see confidence fall