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World-famous luxury brands pocket thousands, mistreat illegal migrant workers | Scoop
European enforcement agencies conducted investigations including several raids on luxury brands’ workshops and makeshift factories that employed undocumented migrants. – Pixabay pic, July 5, 2024
News

World-famous luxury brands pocket thousands, mistreat illegal migrant workers

Luxury brands such as Dior, Armani pay workers as low as USD2 (RM9.42) per hour while selling items in store at thousands of dollars

Scoop Reporters
Updated
9:12 PM MYT

 

KUALA LUMPUR – Workers making items for world-famous luxury brands, such as Dior and Armani, are paid as low as US$2 (RM9.42) an hour, said European enforcement agencies.

This came to light after Italian police conducted a series of raids on workshops and makeshift factories that employed undocumented migrants “off the book”, reported The Wall Street Journal. 

While the workers were supposedly made to work from dawn to dusk, French fashion house Dior paid a supplier US$57 for each handbag made, which is later sold in stores at US$2,780. 

Similarly, Milan-based Armani paid a supplier US$270 for each handbag that retails for under US$2,000.  

Last month, Italian judges had ordered Dior subsidiary Armanti and Alviero Martini Spa to be placed under court administration after ruling that its manufacturing units mistreated their migrant workers. 

Armani, which outsources the manufacturing of its products to an in-house production company known as GA Operations, has since denied wrongdoing by the entity responsible for producing apparel, accessories and home decor for brands under the Giorgio Armani Group. 

“(GA Operations) has always had control and prevention measures in place to minimise abuses in the supply chain (and) will collaborate with the utmost transparency with the competent bodies to clarify its position on the matter,” Armani was quoted as saying in a statement. 

Police reportedly said a subcontractor hired by GA Operations had opted to take on another unauthorised subcontractor, which employed undocumented migrants. 

The unauthorised subcontractor, police said, was paid US$100 for a handbag Armani sold for around US$1,950 while the authorised subcontractor had acted as a middleman and pocketed approximately US$169 for each bag. 

While health and safety regulations as well as rules on working hours, breaks and off days were allegedly disregarded, police said the scheme was part of a system involving the illegal intermediation and exploitation of workers. 

Police said GA Operations, however, is not being investigated as it has been placed under judicial administration for up to a year as part of a procedure to ensure legal operations. 

Four Chinese factory owners, meanwhile, are understood to be the target of a separate criminal investigation. – July 5, 2024

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