Milan court orders judicial administration for Loro Piana

Fashion

Loro Piana allegedly failed to prevent and contain labour exploitation Credits: FashionUnited, AI generated image

Another case of labour exploitation involving a luxury brand has emerged. This time it concerns LVMH-owned brand, Loro Piana. A Milan Court has ordered judicial administration for one year for Loro Piana. Frédéric Arnault has been the CEO of the company since June 10.

According to Italian news agency Ansa, the measure taken by the judges of the prevention measures section concerns an investigation by prosecutor Paolo Storari. He ascertained that Loro Piana had outsourced the production of garments, including jackets, which were allegedly manufactured under "labour exploitation". FashionUnited contacted Loro Piana for comment, but no statement has been released at this time. The company recently obtained a legal victory in the fight against counterfeiting.

Returning to the labour exploitation case, Loro Piana is another high fashion brand on which Storari has shone a light. He obtained the judicial administration regime from the judges. According to investigations by the Milan Labour Protection Group, the company allegedly failed to prevent and contain labour exploitation within the production cycle, as well as implement appropriate measures to verify the actual working conditions. It is believed to have further failed to monitor the technical capabilities of the contracting companies. In this way, Ansa reports, it culpably facilitated labour exploitation.

According to the investigation, the fashion house entrusted the production of garments to an external company, Evergreen. The latter, not having been able to produce the requested garments, allegedly subcontracted the work to Sor-Man snc of Nova Milanese. This company also lacked adequate production capacity. According to the Prosecutor's Office's reconstruction, the company turned, also to reduce costs, to Chinese factories. These were closed by the military and one of the owners was arrested in May. The ruling states they used "irregular and clandestine labour, in unhealthy and dangerous working environments". Workers were housed "in abusive dormitories in order to draw mere manpower at any time of day or night and subjecting them to work shifts (...) far exceeding those contractually foreseen".

This system allegedly allowed for profit maximisation. It induced the Chinese factory that actually produced the goods to cut labour costs (contributions, insurance and direct taxes). It did this by resorting to "undeclared" and clandestine labour. It also failed to comply with health and safety regulations in the workplace and did not respect the National Collective Labour Agreements for the sector regarding workers' wages, working hours, breaks and holidays. According to Ansa, the court found this "mechanism was culpably fuelled by Loro Piana spa. It did not verify the real entrepreneurial capacity of the contracting and subcontracting companies (Sor-Man), to whom it entrusted production. Over the years, it did not carry out effective inspections or audits to ascertain in practice the operation of the production chain and the actual working conditions and work environments."

This article was translated to English using an AI tool.

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