The Prevention Measures Section of the Court of Milan has ordered a receivership for Giorgio Armani Operations Spa, a company involved in the design and production of clothing and accessories for the fashion giant’s group, following an investigation by prosecutors Paolo Storari and Luisa Baima Bollone and the Labor Inspection Unit. The investigation alleges the company engaged in labor exploitation through the use of abusive factories and illegal and undeclared Chinese labor.
The company controlled by Giorgio Armani Spa was allegedly “deemed incapable of preventing and curbing labor exploitation phenomena within the production cycle by failing to put in place appropriate measures to verify the real working conditions or the technical capabilities of the contracting companies so much as to facilitate (culpably) subjects added by corpulent evidence regarding the crime of exploitation.” This is explained by investigators concerning the measure of judicial administration ordered by the Court of Milan.
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In a statement, the prosecutors allege that “the fashion house entrusts, through an in-house company [Giorgio Armani Operations Spa] created ad hoc for the design, production and industrialization of fashion and accessories collections … the entire production of part of the 2024 collection of bags and accessories to third-party companies, with complete outsourcing of production processes.” The supplier company, however, “has only nominally adequate production capacity and can compete in the market only by outsourcing, in turn, the orders to Chinese factories, which manage to cut costs by resorting to the use of illegal and clandestine labor in exploitative conditions.”
An alleged “system” that would have made it possible “to achieve profit maximization” the company “cut labor costs [social security, insurance and direct taxes] by resorting to ‘undeclared’ and clandestine laborers, not observing regulations on health and safety in the workplace as well as not complying with the National Collective Labor Agreements for the sector regarding labor wages, working hours, breaks and vacations.”
Beginning in December 2023, police officers carried out “inspections on the methods of production, packaging and marketing of high fashion garments by proceeding to the control of the subcontractors of supplies as well as unauthorized subcontractors consisting exclusively of factories run by Chinese nationals in the province of Milan and Bergamo.” Four factories were checked “all of which were found to be irregular in which 29 workers were identified, of whom 12 were employed illegally and also nine were illegal.”
The statement also declares that the company housed labor in “dormitories made illegally and in hygienic sanitary conditions below ethical minimums.”
Four owners “of de jure or de facto companies of Chinese origin” and nine “persons not in good standing and residence” are being investigated for exploitation. Finally, “fines of more than 80,000 euros [$86,828] and administrative sanctions of 65,000 euros [$70,548] were imposed, and four companies were ordered to suspend their activities for serious safety violations and for using illegal labor.”
Production in the illegal Chinese factories of clothing and accessories, then sold under the Giorgio Armani brand, was “active for more than 14 hours a day, including holidays.” Workers were “subjected to a grueling pace of work” and with a situation characterized by “danger to the safety” of the workforce, who worked and slept in “degrading housing conditions,” and with wages “as low as 2 to 3 euros [$2.17 to $3.26] per hour, such as to be judged below ethical minimums.”
The investigation into Giorgio Armani Operations Spa is part of a number of probes opened by the Milan Public Prosecutor’s Office into labor exploitation by large companies in transport, logistics, security services and other sectors, including the world of fashion. In recent months, Alviero Martini Spa had been placed under court receivership and a scheme similar to the one that came to light today had emerged.
THR Roma has reached out to the company for comment but did not immediately receive a reply.
