It’s alleged a Chinese worker was physically beaten when he demanded roughly $11,700 in unpaid wages.
This violence led to his employer’s arrest and exposed severe labor exploitation at workshops supplying Loro Piana, the prestigious Italian luxury brand. Milan courts have now placed the company under judicial administration.
Loro Piana becomes the fifth major Italian luxury brand in less than two years under judicial oversight since 2023. Valentino, Armani, LVMH’s Dior, and Alviero Martini have all faced similar enforcement actions. According to Reuters reporting, these cases represent part of a coordinated crackdown affecting brands with combined annual revenues exceeding €15 billion.
The numbers reveal brutal economics behind luxury pricing.
The Financial Times reports that luxury fashion margins typically range from 65-80%, among the highest in any consumer goods category.
Intermediary companies produced jackets for Loro Piana at €118-€128 per piece. Those same women’s cashmere jackets retail for over $4,000. Men’s…
“Gift of Kings” wool toppers cost $11,500. This represents a markup of approximately 9,000% from production cost to retail price, according to industry analysis by McKinsey & Company. Workers endured 90-hour weeks for €4 per hour. Many were undocumented, making them vulnerable to exploitation without legal recourse.
Italy’s National Institute of Statistics (ISTAT) estimates that 12-15% of textile workers in northern Italy lack proper documentation, creating a shadow workforce of approximately 180,000-220,000 people in the broader fashion supply chain.
The Pattern Runs Deep Milan prosecutors found evidence of systematic abuse across the luxury sector. They describe broader business policy exclusively aimed at increasing profit through illegal practices.
The Guardian’s investigation revealed that judicial administrators have uncovered wage theft totaling over €2.5 million across the five brands under oversight, affecting more than 1,200 workers. The violations represent “a generalised and consolidated manufacturing method” among Italian fashion companies…
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