Businesses exploiting staff and failing to keep proper employment records have been stung with hundreds of thousands of dollars' worth of fines.

The Labour Inspectorate said most of the cases involve migrant workers.

Photo: 123RF

Figures given to RNZ show the Ministry of Business, Innovation and Employment has issued $370,000 in fines and nearly 130 notices since it got the power to do so last July.

Labour Inspectorate national manager Stu Lumsden said he expected that figure to increase.

He said the law change has made it much easier and quicker to punish breaches.

It also revealed how bad a lot of employers were at paperwork, with retail, hospitality and horticulture industries among the worst offenders, Mr Lumsden said.

"We're certainly disappointed that they're still failing to keep basic records and we'll continue to push organisations," he said.

But Mr Lumsden said sloppy paperwork was only part of the problem.

"Then you sort of move into the more cynical breaches, people [who] tend not to want to speak to us and [we'll] meet them and their lawyer at the same time," he said.

Numbers 'the tip of the iceberg' - lawyer

The founder of a consultancy agency for small businesses said infringement fines and the resulting media coverage have owners scrambling.

Thai-Anh Cooper from in2HR said with almost weekly headlines of employers being slapped with fines, more and more business owners were calling her for advice about employment records.

She said some were completely caught out by the Labour Inspectorate and contacted her in a panic.

"I had a business owner ... [and] the labour inspectors had turned up on his doorstep and he ran into the toilet and gave me a call and said, 'Hey they're here, on my doorstep, what do I do?'," she said.

Companies breaching employment rules can be added to a stand-down list, which prevents them from hiring migrants for at least six months.

But Worker's Advocate Limited director Nathan Santesso said that was barely scratching the surface of the problems migrant workers faced.

"This is definitely the tip of the iceberg.

"I get people contacting me almost every day with problems like this," he said.

Mr Santesso said it was usually left to migrant workers to alert authorities when they were being exploited, something many were not willing to do because they were scared they could get kicked out of the country.

He said while the government has taken steps in the right direction, more support for migrants was needed.