Nearly 300 migrant workers involved in the construction of the new US Consulate in Milan are set to receive compensation under a €31 million settlement following an investigation into alleged labour exploitation.
The settlement covers unpaid wages and damages for workers who prosecutors said were paid extremely low wages while working on the major construction project.
The agreement was reached between Milan prosecutors, Alabama-based construction company Caddell Construction and a court-appointed administrator overseeing the site following the investigation.
Italian prosecutors said the criminal investigation into Caddell and two of its managers remains ongoing.
The company had not immediately commented on the settlement.
Italian Labour Minister Marina Calderone described the investigation as one of the country’s significant recent operations targeting illegal labour contracting and worker exploitation. She said the outcome demonstrated that authorities would continue to protect vulnerable workers.
According to Luca Stanzione, secretary general of the Milan branch of the CGIL trade union, nearly 300 workers identified in the case will receive an average of about €50,000 each.
Some workers could receive as much as €90,000 in unpaid wages and compensation for emotional distress.
CGIL’s construction union has been supporting workers involved in the case throughout the investigation.
Of the approximately €31 million settlement, around €19.7 million has been allocated for direct payments to workers. The remaining amount will cover obligations to Italy’s social security authorities and labour inspectorate.
Most of the workers were recruited from India before travelling to Italy for the construction project. The Associated Press also spoke with workers who said they had previously been recruited through a Caddell project at a US embassy facility in Africa.
Milan prosecutors alleged that workers were subjected to exploitative working conditions after being promised fair wages during recruitment.
According to the investigation, some workers’ pay records showed that they received less than $2 an hour. Prosecutors also alleged that deductions for food and accommodation were unlawfully taken from their wages.
The reported wages were significantly below the minimum rate for construction workers in Milan, which starts at €13.19 per hour.
The construction site was placed under judicial administration during the investigation. The measure was intended to allow work to continue while ensuring that labour practices at the site complied with Italian law.
The new US Consulate campus is being constructed on a 10-acre, or roughly 40,000-square-metre, site at a former shooting range. Once completed, the complex will replace the existing US consulate, which is currently located in a high-rise building.
The case has also resulted in additional support for some of the affected workers. Dozens have been granted unemployment benefits, while 265 workers have received special residence permits allowing them to remain in Italy.
Applications for residence permits for the remaining workers are still being processed.
The settlement is being described by unions supporting the workers as one of the largest compensation agreements of its kind in Europe. It also highlights the difficulties migrant workers can face when recruited across borders for major construction projects, particularly when promised wages and working conditions differ from those they encounter after arrival.
With the criminal investigation still continuing, Italian authorities are expected to examine further the circumstances surrounding the alleged labour practices and the responsibilities of the company and individuals involved.