Italian Authorities Investigate Luxury Brands for Labor Exploitation

On Thursday, Italian law enforcement conducted raids at various luxury brand offices over concerns that their subcontractors might be using Chinese sweatshops.

This operation is part of a larger inquiry being led by Milan authorities into the subcontractors associated with these brands, amid accusations of labor exploitation and the employment of illegal Chinese migrant workers in Italy.

According to the Italian newspaper Il Sole 24 Ore, the raids were executed by the Labor Protection Division of the Carabinieri Gendarmerie, following instructions from Milan prosecutor Paolo Storari.

Prosecutors allege that well-known luxury brands are utilizing “front” companies as suppliers, who, in turn, rely on Chinese sweatshops that fail to meet hygiene and safety standards, while paying workers below acceptable wages.

The investigation is expected to scrutinize the supply chains and production of luxury bags and accessories for at least 11 brands, including Chanel, Brunello Cucinelli, Goyard Italy, Moncler, and others.

Reports suggest that the targeted companies had commissions with manufacturers Moda Fashion Style and Isacco. In May, authorities searched their facilities and found evidence of illegal employment of Chinese workers without necessary permits, along with other workplace issues. According to Rai News, these unauthorized workers were paid based on a “piece rate” system.

During the raids in May, products from the targeted brands were discovered in the factories of Moda Fashion Style and Isacco. Investigators also noted the absence of safety mechanisms on machinery, labels indicating “Made in Albania,” and reports of poor living conditions for workers. Analysis of the factory’s power usage suggested operations were ongoing for extended hours, including holidays.

Additionally, Il Sole mentions that other high-profile cases involving brands like Armani, Valentino, and Dior have either been addressed or are currently being resolved with assistance from court-appointed commissioners aiming to eliminate wrongdoing within their supply chains.

A previous raid occurred in December against another luxury brand group, also regarding claims of worker exploitation by subcontractors. At that time, Reuters reported that Italian police sought documents from thirteen luxury brands, including Prada and Gucci, although none of the brands were named in the investigation.