Gucci Faces "State of Unrest" as 1,000 Employees Consider Strike Action

Approximately 1,000 unionized Gucci employees are contemplating a strike due to unpaid welfare incentives pledged by the parent firm Kering for the years 2022-2024.

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The luxury business is contending with adverse economic conditions resulting in declining sales, while a series of labor scandals has impacted the Armani Group and LVMH brands, including Loro Piana, Dior, and Valentino. Gucci is now implicated in labor disputes as a thousand employees threaten to strike.

Unionized employees at Gucci Italia officially declared a "state of unrest" yesterday and have initiated industrial action that may culminate in a strike, as reported by Reuters. The unions stated, "We refuse to succumb to a detrimental trade that eliminates protections from one party and reallocates them to another". “We regard the company’s stance as profoundly serious; consequently, we are proclaiming a state of unrest at the national level, with potential industrial action to be communicated locally if required,” they stated.

The trade unions Filcams Cgil, Fisascat Cisl, and Uiltucs represent Gucci retail and logistics employees who assert they have not received the welfare payments promised by Gucci's parent company, Kering, for the years 2022-2024. Their statement references explicit assurances of the advantages established in the package ratified in July 2022.

The employees have dismissed Gucci’s proposal to link welfare payments to a broader review of incentives, asserting that the company “has merely squandered valuable time, ridiculing the diligent workers in the stores who have been awaiting—and continue to await—their welfare payments.”

Under the leadership of new CEO Luca de Meo and creative director Demna, the brand is at a critical juncture both creatively and operationally. Kering's Gucci has already suffered significantly from the economic downturn, with a substantial 25% decline in sales in Q2. The emergence of a significant labor controversy undoubtedly undermines their position. In 2023, Gucci Italia faced its most recent strike, as employees protested the relocation of the brand's creative office. Nevertheless, the prior strike encompassed merely a few dozen employees.

As previously said, Gucci is not the only transgressor in the industry. On Monday, Armani was penalized almost $4 million USD by Italian authorities who had subjected the company to court administration last year for employing people under unsafe and illegal conditions. In July, LVMH's Loro Piana became the latest luxury brand to enter court administration due to analogous discoveries, culminating in the severe assault of a garment worker in Milan. Loro Piana is the third LVMH brand to receive restrictions in the past two years, following Dior and Valentino, which had their limits removed after implementing corrective actions.