Indian workers begin payouts in Milan US consulate labour abuse settlement

Foreign workers, most of them Indians, building the new US consulate compound in Milan have begun signing agreements for payouts over alleged labour abuses while working for American construction company Caddell Construction. More than 60 workers signed the deals on Wednesday after the process began on Tuesday, as part of a 31-million-euro settlement agreed last month.

Prosecutors have described it as the biggest labour settlement for labour exploitation in Europe. Over two days, 115 workers signed the agreements, with the procedure set to continue next week, while nearly 480 workers in all are expected to receive payouts.

The workers signed the papers at a Milan hotel. Each signed a document seen by The Associated Press agreeing not to disparage Caddell and not to disclose the individual amounts they would receive. Caddell said in the document that the settlement was not an admission of liability, and the individual payments are to be made within 30 days of signing.

Francesco Brigatti, the court-appointed administrator working to restore legality at the consulate construction site, said the workers saw the amounts in writing for the first time during the signings. He said the average payout was 45,000 euros, with the highest reaching nearly 90,000 euros. Brigatti said the payouts include unpaid overtime, reimbursement for housing costs that were illegally deducted from wages, and damages sought by Prosecutor Paolo Storari. "The damages component alone amounts to 60–70 per cent of the overtime total," Brigatti said, adding that this was well above the 10 to 30 per cent he said was more usual in such cases.

Dilip Ram, a 43-year-old mason from India who has worked at the Milan consulate site for more than two years, said the money would help his family of five in Bihar. "Things are better now than before... we get more rest now," Ram said after signing the deal. "This has led to a lot of change. This settlement will be good. Because the workers had troubles, that's why this settlement has been applied."

Prosecutors said the workers were paid less than USD 2 an hour, had money illegally deducted for housing, and were denied overtime despite working up to 10 hours a day, six days a week. They also alleged that the workers faced threats and were not given proper medical care after injuries at work. Most of the workers were from India, though others came from Nigeria, Kenya and Bangladesh.

Officials said workers from India reported paying 5,000 euros to recruiters to secure the jobs, but the settlement did not directly address what happened in India because prosecutors could not investigate there. The investigation into Caddell remains open pending the payouts, which are expected to be completed by February. Two managers under investigation for extortion and facilitating illegal immigration remain under house arrest.

Caddell's settlement also includes about 11.2 million euros for Italy's social security system and workplace injury insurance. Under the agreement, workers are also getting permits to work in Italy even away from the Caddell site. Caddell, a major contractor for US embassies and consulates worldwide, said in June that it was fully cooperating with Italian authorities, reviewing its global subcontractors and consultancies for compliance with labour laws, and working with authorities to protect workers on the project. It has declined to comment on the settlement. The US State Department has said it is investigating the prosecutors' allegations and that US law enforcement is working with Italian authorities.

Adelio Riva, a labour lawyer working as a consultant for the prosecutor's office, said efforts were under way to reach workers eligible for compensation. "We have asked the Indian consulate to help," he said. "We are relying heavily on word-of-mouth because, as they say, follow the money." The signings are also being monitored by three construction worker trade unions assisting the workers.

Trinofe Radogna of the Fenealuil construction workers union said the case was a difficult end to a saga that began when unions were denied access to workers at the consulate site after diplomatic status was wrongly cited. He said the union had never before been blocked from informing workers of their rights in Milan, which has seen a construction boom over the past two decades. "We have never encountered a labour-exploitation system on this scale," Radogna said. "Here workers' dignity was lost: they found themselves without accommodation, without meals, and they were already starting at a disadvantage because they had to pay 5,000 euros before leaving."

The settlement process will continue next week and is expected to cover nearly 480 workers, including around 300 still on the site, another 100 elsewhere in Italy, and the rest in their home countries, closing one part of a case that is still under investigation.

With PTI Inputs

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