Italy investigates Louis Vuitton controller for illegal work

Prosecutors in Milan, Italy, are investigating the supply chains of a dozen fashion brands after discovering illegal working conditions at suppliers associated with a unit of LVMH, a French luxury conglomerate that owns brands Louis Vuitton, Dior , Tiffany and Moët & Chandon.

According to an exclusive report from the agency Reuters, investigations began with 4 suppliers on the outskirts of Milan, revealing practices such as excessive working hours and inadequate accommodation conditions in the workplace. Some workers were without formal contracts, while 3 were illegal immigrants in Italy.

As a result, a commissioner was appointed by the Milan court to oversee the company, marking the 3rd such appointment this year. In April, a similar measure was taken against a company linked to Giorgio Armani, accused of failing to supervise its suppliers. The Armani Group responded, claiming that it had always sought “minimize abuses in the supply chain”.

The appointment of a special commissioner aims to give subsidiaries of fashion brands the opportunity to resolve issues in their supply chains while continuing to operate. To date, neither LVMH nor Armani are directly under investigation; The accusations fall on suppliers involved in the exploitation of workers.

Milan prosecutors’ decade-long investigations initially began with recruitment companies that illegally employed workers and avoided taxes and social security contributions to reduce the costs of services provided. Recently, attention has shifted to the fashion sector, where similar problems have been identified.

Italy represents between 50% and 55% of global luxury goods production, with thousands of small manufacturers supplying big brands. One example cited in the investigation revealed that a small manufacturer charged Dior just 53 euros to produce a bag, which was later sold in stores for 2,600 euros.