Two Hamilton car companies have been handed down fines for a raft of breaches including not paying the minimum wage to staff (file photo).

Two Hamilton car companies that failed to pay employees minimum wage have been fined over $65,000 in penalties.

A Labour Inspectorate investigation revealed Direct Auto Importers Ltd and Cheap Deals on Wheels Ltd also failed to pay minimum wage, correct holiday pay, provide employment agreements, or keep records of employment.

The sole director and shareholder of both businesses, Vishaal Sharma, claimed that the employees were contractors and denied he owed them their minimum entitlements – a claim thoroughly refuted by both the Inspectorate and the ERA.

"An employer cannot avoid their obligations by simply calling their employees 'contractors', and any attempts to do so will not be tolerated by the Inspectorate," Labour Inspectorate regional manager Loua Ward said in statement.

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"All employees in New Zealand must be provided with written employment agreements and their minimum employment entitlements, such as the minimum wage and holiday pay. If an employer cannot meet these basic obligations, then they should not be an employer.

"Direct Auto Importers (NZ) was already taken to the ERA last year by an employee who successfully claimed $17,996 in arrears, so this employer should've known their obligations.

"The onus is on employers to correctly provide their employees with all their minimum entitlements - ignorance is not an acceptable excuse."

Direct Auto Importers (NZ) Ltd was penalised $50,000 for not paying their three employees' holiday pay, providing written employment agreements, or keeping wage, time holiday or leave records, with a further $726 in arrears to be paid to two staff members for holiday pay owed and working on public holidays.

Cheap Deals on Wheels Ltd was penalised $15,000 for a similar set of breaches.

The ERA set aside $10,000 in penalties to be provided to three of the former employees of the businesses.