Foreign workers say they were paid less than $2 an hour to build a new US Consulate in Milan
MILAN (AP) — Foreign workers building a sprawling $350 million American Consulate in Milan were paid less than $2 an hour after being promised fair wages, according to Associated Press interviews with five former employees and a review of their employment letters and pay stubs.
Italian prosecutors are investigating Montgomery, Alabama-based Caddell Construction, a major builder of U.S. diplomatic missions. Two of its managers in Italy were arrested this month on suspicion of labor exploitation, one while boarding a flight to leave the country and another planning to flee, prosecutors said.
The investigation is led by prosecutor Paolo Storari, who also has spearheaded probes into sweatshops supplying luxury brands. So far only Caddell has been named as a target, not any of its subcontractors.
The consulate probe was launched about six months ago and involves some 70 workers, mostly from India. Prosecutors allege Caddell illegally deducted room and board from wages and forced them to work 10-hour days, six days a week. Some were paid as little as 500 euros (less than $580) monthly after room and board were deducted, prosecutors said.
Caddell and the U.S. State Department said they are investigating the allegations and cooperating with Italian authorities.
The consulate project is part of a construction boom in Milan over the past two decades that has modernized the skyline and raised the international profile of Italy’s fashion and finance capital.
The AP spoke to four workers from Kenya and one from India at a trade union center where officials were organizing assistance, including legal help and housing. The workers provided documentation and spoke on condition of anonymity out of fear of retaliation and to protect the ongoing investigation.
The Kenyan workers said they had been hired by Caddell after working on a multi-million-dollar extension of the U.S. Embassy in Nairobi.
Two showed employment letters on Caddell stationery signed by a company representative promising annual salaries topping 25,000 euros (nearly $29,000).
They said they were not paid anything close to that and were threatened by human resources personnel at the job site after they questioned management.
“When you go to the office to ask any question, you are being told, ‘Either you work or you will be returned to your country. That’s the amount you are supposed to be paid,’’’ one Kenyan electrician said. He added that he was paid just 800 euros ($925) a month after being promised 2,300 euros ($2,660).
Another Kenyan electrician said he was threatened with defamation after presenting an AI summary of Italian labor law and was told the 25,000 euros in the employment letter was “for visa purposes,” not a promise of payment.
The State Department said it is investigating the allegations made by prosecutors and that U.S. law enforcement is working with Italian authorities.
“The U.S. government does not tolerate labor exploitation,” the department said in a statement.
Caddell said it was “fully cooperating” with Italian authorities and conducting its own “comprehensive inquiry into this matter to ensure all our global subcontractors and consultancies are in compliance with all labor standards and legal requirements.”
“Caddell is committed (to) treating and paying workers fairly. We will continue to work with authorities in good faith to ensure the welfare of those who work on this important project,” the company said in a statement.
More than a decade ago, Caddell paid millions to the U.S. government to settle allegations it made false claims to gain access to government incentives. Caddell did not reply to a request for comment on that case.
All five of the workers who spoke to the AP, ranging in age from their late 20s to early 50s, said they were fired without cause this year. One of them said he returned from visiting family in Kenya to find that he no longer had a job or place to stay.
Four of the workers were trained electricians, including the Indian worker whose resume showed he had more than a decade of experience working for other companies in Persian Gulf countries.
The Indian worker said he was promised a monthly salary of 2,500 euros (nearly $3,000). Instead, he had a pay slip showing his actual pay amounted to around 500 euros (less than $580) per month. It listed an hourly wage of 1.55 euros ($1.80).
The Kenyans said they reached out to authorities after learning of the investigation.
“I believe in justice,” one said. “Also the workers there should not be afraid. They should come and speak up.”
Two said they are currently sleeping in parks, while one is staying with a friend. One said he had been offered a job at a Caddell site in another country but declined after his treatment in Milan.
Caddell became a leader in building U.S. diplomatic missions when the State Department launched a major security upgrade after the 1998 bombings of U.S. Embassies in Tanzania and Kenya killed more than 250 people.
“Very few contractors can meet the strict requirements to even bid on secure work necessary for diplomatic facility projects,” Caddell said on its website marking its 40th anniversary in 2023. At that point, the firm counted 39 projects in its embassy portfolio valued at $7.4 billion. It has added four projects since then.
The Milan consulate campus is being built on a 10-acre (40,000-square meter) site at a former shooting range. The current U.S. Consulate is in a high-rise building designed by acclaimed Italian architect Gio Ponti.
Plans for the campus called for about 500 “locally employed workers,” according to the U.S. State Department. The project includes restoration of a century-old building, along with a five-story consulate building, restored gardens, a reflecting pool and a large outdoor gathering area.
Work is continuing under court supervision. Workers no longer have their room and board deducted. They are limited to 45 hours and guaranteed two days off a week.
The pay stubs presented by the workers listed apparent charges of 510 euros (around $590) a month for housing and more than 300 euros (around $350) monthly for food. But those deductions only account for a portion of the difference between the promised wages and actual pay.
Unions intend to seek damages for the workers to recover at least what they earned “through hard work and commitment,” said Laura Malguzzi, a labor representative at the Fillea Cgil union federation representing construction workers.
Malguzzi said she was surprised that the pay stubs presented by the workers appeared to document the alleged exploitation. Union experts are still studying the documents, which do not conform to Italian standards, and could not verify their origins.
“They probably had in their minds the absolute certainty that they were untouchable,’’ Malguzzi said.
The Kenyan workers said they begrudgingly accepted a $200 monthly salary in Nairobi, where unemployment is rampant. But they expected better from a U.S. company operating in Europe.
“They can just hire you, and you just go running,” one worker said of the company. “Because you are poor you have nothing. And you have nothing you can do.”
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