The Immigration Minister says the treatment of student hotel interns who were threatened, overworked and underpaid is appalling and unacceptable.
Since Newshub highlighted their plight on Tuesday, the company that underpaid the workers says it'll take immediate action to pay them back what they're owed.
The students paid thousands of dollars to come to New Zealand for a hospitality internship as part of their studies in hotel management.
They were employed cleaning at the luxury Grand Mercure hotel - but they say they've been "treated like slaves".
"On the face of it, it looks like they've been treated appallingly. This is exactly the kind of exploitation I'm concerned about in New Zealand," Immigration Minister Iain Lees Galloway told Newshub.
Wellington company Internship NZ brought the students to New Zealand and then arranged for them to sign up as housekeepers for AHS Hospitality, which has a contract to clean rooms at Wellington's Grand Mercure.
This is how the boss of Internship NZ, Karen Oswald, spoke to a student when AHS told her the student hadn't cleaned a room correctly.
"Filthy and lazy, that's what you're showing. The alternative is go home," she told the student. "I'm telling you that's what will happen if you continue like this."
Ms Oswald used to work for the Department of Labour, now known as the Ministry of Business, Innovation and Employment (MBIE) - the very agency charged with fighting worker exploitation.
It's something Mr Galloway is unhappy about.
"Well that is a real shame, that someone who has worked in the system has taken that kind of attitude to people," he says.
"There is a power imbalance between employers and employees that's heightened when you have a migrant - and unfortunately, I think we've got a case here of someone absolutely abusing that power imbalance."
Newshub also revealed an AHS manager told students to deduct hours from their timesheets, meaning they were getting below minimum wage.
AHS says it has "terminated its relationship with Internship NZ" due to its unacceptable behaviour. It's also started an "independent inquiry" and it has admitted students it employed have indeed been underpaid, saying its taking "urgent remedial steps" to address discrepancies in their pay.
But Unite Union national secretary Gerard Heir says this isn't good enough.
"This should have been known about a lot earlier, and steps should have been taken - so yes, there is a failure at an organisational level," he told Newshub.
Cabinet papers on the Government's plans for exploitation reveals MBIE has been tasked with a major investigation into the problem, which will include meeting and learning from migrants, employers and unions.
In the case Newshub has highlighted, the Minister wants the students to lay complaints with MBIE, so Immigration NZ can begin a formal investigation.
The Labour Inspectorate says all employees in New Zealand have rights which must be respected, which apply equally to migrant employees.