In a significant move to address widespread labor abuses, Italy’s fashion industry leaders, legal authorities, political bodies, and trade unions signed a non-binding action plan on Monday aimed at fighting worker exploitation across the apparel and accessories supply chain. The agreement follows alarming revelations by Milan prosecutors about systemic abuses within the sector.
Italy is a global powerhouse in luxury fashion, responsible for producing about half of the world’s high-end fashion goods. Yet, beneath the glamorous surface, investigators have uncovered troubling labor practices that sacrifice worker welfare for corporate profits. Milan prosecutors have described these exploitative methods as a “generalised manufacturing method” that endangers lives to cut costs and maximize revenue.
The newly signed action plan stems from a draft proposed by the Milan court in June of last year. That proposal followed investigations into clandestine workshops where underpaid workers—many of whom were undocumented immigrants—were making leather handbags destined for luxury brands such as Dior and Armani. These workers were reportedly paid just a fraction of the items’ final retail prices.
Earlier this month, an Italian court took action by placing a Valentino subsidiary under judicial administration for one year due to worker abuse within its supply chain—further underscoring the urgent need for reform.
“The goal is that the court will no longer have to intervene,” said Fabio Roia, president of Milan’s court system, during the memorandum signing event. His statement reflects the hope that proactive measures by industry stakeholders can prevent further judicial involvement.
The memorandum of understanding, reviewed by Reuters, centers around creating a centralized database to track the suppliers and workforces used by fashion brands. Companies that are part of the supply chain will voluntarily upload data to the platform, including information related to tax records, social security contributions, and labor law compliance. This information must be updated at least twice a year.
While the initiative is voluntary, the plan encourages fashion brands to promote awareness of the new database and persuade their suppliers to participate. Importantly, brands are not prohibited from continuing to work with suppliers who choose not to join the system, raising questions about enforcement and accountability.
To incentivize participation, the regional government of Lombardy, which includes Milan, will issue renewable six-month certificates of transparency to firms that sign up for the program. These certificates are intended to signal a company’s commitment to ethical labor practices.
Although the plan lacks legal enforcement, it represents a united front by Italy’s fashion industry to confront unethical labor practices and promote greater transparency. Whether this initiative will be enough to bring about lasting change in one of the world’s most influential fashion hubs remains to be seen.
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