Action is being taken against 19 employers in the dairy industry for breaches of employment law, the Ministry of Business, Innovation and Employment (MBIE) said.
The ministry's labour inspectorate visited 29 dairy farms in nine regions during a three month operation to check their compliance with employment laws.
More than half were targeted due to information about likely non-compliance, the ministry said in a statement.
"The level of non-compliance identified during this operation was extremely high and it was disappointing to find that a significant number of farmers still do not have systems in place to keep accurate time and wage records that are compliant with employment legislation," the ministry's labour inspectorate central regional manager, Natalie Gardiner, said.
Nine of the more serious cases are being considered for filing with the Employment Relations Authority, she said.
"The ministry takes the exploitation of workers very seriously and is working proactively to crackdown on it through compliance operations targeting sectors and at risk workers across New Zealand," she said.
Breaches will be subject to compliance action and potential penalties of up to $10,000 for individuals and $20,000 for companies.
The farms visited were located in Northland, Bay of Plenty, Waikato, Thames/Coromandel, Taranaki, Hawkes Bay, Manawatu/Rangitikei, Wairarapa, Canterbury and Southland.
Enforcement action has been taken against 19 employers whose farms were visited.
Federated Farmers said it was disappointed by the ministry's findings.
Andrew Hoggard, Federated Farmers Dairy Chair, said it was "not a great look for our industry".
The farmer-funded group, DairyNZ, said the ministry's findings showed the industry still has more work to do to lift its performance.
"Employment conditions on dairy farms are critical to attracting and retaining talented people," says DairyNZ's strategy and investment leader for people and business, Mark Paine, said.
MBIE was formed in 2012 by bringing together all the existing functions of the Ministry of Economic Development, Ministry of Science and Innovation, Department of Labour and Department of Building and Housing.
By Jamie Gray of the NZME. News Service