Former workers of a Dunedin bakery will be compensated more than $250,000 for the exploitation they endured.

Anesly Joy Samuel, the former owner of Romeeco Bakery and Knox Cafe, was presented with a total bill of $392,038 after a Labour Inspectorate investigation and subsequent Employment Relations Authority (ERA) case showed a pattern of ill-treatment stretching back five years.

The judgement, delivered in November last year, also detailed threats the businessman had made to staff when he suspected they had complained to officials.

Samuel told one worker he would arrange someone to cut off the man's limbs and harm his family; a second was told to "prepare for his parents' funeral in Sri Lanka".

The ERA found the three employees had been grossly underpaid and Samuel was ordered to pay wage arrears and penalties within a month.

However, his inability to sell his four-bedroom home or the business saw that deadline lapse.

In February, the Ministry of Business, Innovation and Employment told the Otago Daily Times Samuel had only paid $40,000 and it was taking "enforcement action".

Later, it confirmed a charging order over the man's property had been obtained to secure the debt.

Labour Inspectorate Southern regional manager Jeanie Borsboom this week said a sale had been completed, leaving only about $40,000 outstanding.

"This is a clear message that businesses who exploit their workers will face severe penalties and, they will be subject to the enforcement of these," she said.

Borsboom hoped the financial compensation would provide the victims some closure.

Samuel's partner Wadduwage Nirosha Dilrukshi Perera previously said her husband had been set up.

Inspectors made their first visit to Romeeco Bakery in George St in November 2017 and discovered there were no timesheets for workers.

Two days later they found one man working outside rostered hours, and staff later disclosed they did more than 80 hours a week.

Samuel handed over documents that appeared to show staff working 40 hours a week but they "had the appearance of after-the-fact reconstruction about them", investigators said.

While Samuel claimed his actions were "inadvertent and unintentional", ERA chief Andrew Dallas said that was overwhelmingly disproved by the evidence.

Samuel and Perera have been contacted for comment.

- Rob Kidd, ODT