Gucci disputes TV show comparison of $1,250 handbag to $38.80 cost of assembly

A woman holding an umbrella walks past a company logo of a Gucci boutique outside a shopping mall in central Guangzhou. The Italian fashion house said it would strengthen controls on its suppliers after a television programme showed Chinese employees
A woman holding an umbrella walks past a company logo of a Gucci boutique outside a shopping mall in central Guangzhou. The Italian fashion house said it would strengthen controls on its suppliers after a television programme showed Chinese employees working more than three times their official hours to assemble its handbags. -- PHOTO: REUTERS 

Milan (Reuters) - Italian fashion house Gucci said on Monday it would strengthen controls on its suppliers after a television programme showed Chinese employees working more than three times their official hours to assemble its handbags.

The head of a Gucci subcontractor told an investigative programme broadcast by RAI state television on Sunday that Gucci was aware it irregularly employed Chinese workers.

Aroldo Guidotti of subcontractor Mondo Libero (Free World) said the employees toiled away for as long as 14 hours a day, while they were supposed to work only for four hours, to assemble handbags that he sold to Gucci for 24 euros (S$38.80).

The bags sell in shops for around US$1,000 (S$1,250).

In a statement responding to the Report TV show, Gucci said it had acted properly but pledged to raise the number of inspections at its suppliers and take more effective action where needed.

Working conditions in plants producing garments and accessories have become an increasingly global issue as activists and trade unionists campaign against long hours and low wages in developing countries or among immigrants in industrialised states.

The Tuscan fashion house, part of French luxury group Kering, said it had carried out numerous inspections at Mondo Libero, which is based near Florence. The supplier had proved that it had addressed and mostly solved irregularities in working conditions. "Hidden and inappropriately used cameras, shooting carefully selected supplier companies (3 out of a total 576), do not provide for a true or accurate representation of Gucci and its supply chain policies and procedures," the statement said.

Gucci said Report wrongly compared the final price of a bag with the cost of assembling it, leaving out the cost of raw materials or the cutting, packaging and shipping expenses involved.