Fishing company admits underpaying foreign crew

16:00, Feb 16 2013

One of the country's biggest fishing companies has admitted its low-wage Indonesian fishermen on foreign charter fishing vessels (FCVs) have been underpaid, leaving nearly 100 workers out of pocket by $885,000.

And one of the key advocates for cleaning up the industry says total underpayments could reach $13 million.

Auckland-based Sanford Fisheries said the underpayment was the fault of Indonesian labour agent PT Indah Megah Sari (PT IMS) which hid non-payments from Sanford "because the amounts paid to the families . . . were shown as having been signed off by the families". They were not and no-one knows where the money went.

Sanford - whose directors include National Party president Peter Goodfellow - uses three trawlers owned by Dong Won Fisheries of Seoul.

Sanford ordered Dong Won and PT IMS to publish newspaper notices in Jakarta last week calling for crew who worked between June 2009 to May 2012 to contact them so they "can take the rest of their salaries caused by missed counting . . ."

Sanford publicly admitted the problem after Official Information Act documents obtained by the Sunday Star-Times revealed underpayments, something Sanford had strenuously denied a year ago.


The revelation came as crew walked off one of Sanford's other FCVs in Timaru last week and Parliament passed a first reading of a bill that will outlaw foreign flagged fishing boats here, following an expose by this newspaper into slave-like conditions on many of those boats.

Slave Free Seas campaigner, Tauranga lawyer Craig Tuck, said Sanford's admission was probably only the start.

"If the extent of the underpayments we are seeing in the Sanford case go across the industry, and it is systematic, the true amount of underpayment could easily top $13 million," he said.

Immigration New Zealand wrote to Sandford in September saying audits had found "substantial non-compliance". It said accountancy firm KPMG could not determine whether employees had been paid appropriately and that documentation was "insufficient, missing or written in Korean".

Greg Johansson, Sanford's general manager operations, wrote back admitting there were problems with wages.

"From investigations it became apparent to Sanford that not all monies remitted by Dong Won to Indonesian agents in the past for crew wages was passed on to the crew's families," Johansson wrote.

Sanford had told Dong Won to document each serving crewman and worked out around $500,000 was involved. They ordered it placed in a legal trust account along with a "letter of irrevocable instruction" saying the money could only go to New Zealand bank accounts of individual crewmen.

Sanford asked for another $385,000 for previous crews not currently in New Zealand.

The company said last week its initial investigation did not uncover the issue "because the amounts paid to the families by manning agents were shown as having been signed off by the families".

Sanford remains adamant there was no mistreatment of crews on vessels.

Last week 14 of the 35 crew aboard Sanford's 29-year-old factory trawler Pacinui, owned by the Korean company Juahm, walked off in Timaru. At one stage, a private detective boarded the ship. Sanford said the 14 went ashore over "management of issues".

Human rights advocates said the crew left because their timesheets were being manipulated to reflect fewer hours than those actually worked.

The week before, 21 crew on another FCV, Sur Este 707, walked off in Timaru and are now being cared for by the Salvation Army.

Sunday Star Times