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5 Apr 2024

Colleen Barry, Associated Press

Italy: Court places Armani company accused of subcontracting companies that exploited migrant workers under judicial administration; incl. company comment

See all tags Allegations

JEF FREE.Z via flickr, CC BY-NC-ND 2.0 DEED

"Armani company put in receivership amid labour exploitation probe"

  • Workers in Chinese-run workshops paid 2-3 euros/day, judges say
  • Probe finds migrant workers eating, sleeping in factories
  • Judges order one-year receivership for Giorgio Armani Operations
  • Armani Group says it has control measures to minimise abuses

An Italian court placed under judicial administration a company owned by Italian fashion group Armani accused of indirectly subcontracting production to Chinese companies that exploited workers.

The judges in Milan ordered a one-year receivership for Giorgio Armani Operations, described as an industrial arm of the Armani Group, according to a 31-page ruling seen by Reuters on Friday.

During this period, the company will continue operating, but under a court-appointed administrator.

Armani Group said in a statement it had "always had control and prevention measures in place to minimise abuses in the supply chain," adding it would work with the authorities to clarify its position.

The Milan public prosecutors' office has for years been investigating the outsourcing of production by large groups in fashion and other sectors to subcontractors who allegedly exploit workers. [...]

"The investigations uncovered irregular practices so deeply rooted and established, that they can be considered part of a wider business growth strategy," judges said.

Police found Chinese and Pakistani migrants, often with no legal papers, forced to eat and sleep in the factories in degrading conditions, and employed without any work contracts, they said.

Workers used machinery with safety devices "purposely and maliciously removed", were exposed to potentially dangerous chemical substances, and were denied medical examinations or training, the court ruling added.

The owners of the contracting and subcontracting companies are under investigation for exploiting workers and employing people off the books, while Armani Operations is not facing any probe.

The Armani unit was nevertheless placed under administration "for culpably failing to check the production chain and remaining inactive despite being aware of the outsourcing of production by the supplying companies". [...]

"This is the second measure of this kind against a fashion company. We need to sit down and discuss with authorities and the operational problems of this market sector, which is so relevant for Italy", Milan Court President Fabio Roia said. [...]