The latest ‘investigative trend’, mainly developed by the Milan Public Prosecutor’s Office, is the increasing application of judicial administration measure set forth by anti-mafia legislation.

Initially conceived as a sanctioning measure aimed at cutting links between the mafia and the business world, the measure would now appear to have changed its nature, becoming an effective preventive tool aimed at fostering a culture of compliance and legality in companies operating in contexts completely unrelated to organised crime.

Now, the measure constitutes one of the main ‘weapons’ available to the legal system to face corporate crime.

In the ‘old system’, the school-case could be, for example, the supermarket or the construction company used to launder the revenues arising from illegal activities conducted by the criminal syndicate .

Instead, the sectors now mainly ‘affected’ are those of logistics, transport, security, cleaning, manufacturing, large-scale distribution and, most recently, fashion.

The Milan judgments in this respect are numerous, and also particularly striking as they concern leading companies in the aforementioned sectors.

The common thread between the various events can be identified in the reproach levelled at the client: the failure to ‘…verify the real entrepreneurial capacity of the contracting companies to which it entrusted works or services…’ and ‘…never having carried out inspections or audits to ascertain the real working conditions and the working environment…’. .

In other words, not having ‘never actually verified the supply-chain, deeping the real entrepreneurial capacity of the companies with which the supply contracts were stipulated and the concrete production methods adopted by them, omitting to take initiatives such as the formal request for verification of the chain of sub-contracts, the authorisation of sub-contracting or the termination of commercial links’.

And it is precisely in these omissions that the facilitating conduct usually ascribed to the client company and required by the anti-mafia legislation for the application of the judicial administration is substantiated.

The mentioned judgments have also listed the so-called anomaly indices, situations that allows judicial administration:

– absence of the necessary organisational and operational structure to manage the contract (pseudo-contractor);

– organisational and directive power over the contractor’s workers exercised, de facto, by the principal (pseudo-contractor);

– non-assumption, in practice, of the entrepreneurial risk by the contractor.

Some factual indications of “illegal exploitation of labour” were also identified in:

– repeated violations of mandatory regulations on working hours, rest, etc;

– repeated payment of wages not in line with the workers’ collective bargaining;

– violations of occupational health and safety regulations:

– subjection of workers to degrading working conditions, surveillance methods or housing situations.

If these elements are met, the measure can be triggered, which is applied at the end of a very streamlined procedure that does not require the existence of a criminal trial nor the prior ascertainment of criminal liability. It is, as mentioned, a preventive action of the system where presumptive evidence and clues are sufficient.

In a nutshell, the measure provides for the appointment of a Judicial Administrator by the Court, who will first and foremost have to guarantee business continuity and employment levels, as well as draw up a detailed intervention plan aimed at resolving critical issues and restoring legality.

After the deadline granted by the Court, if the prescribed actions have had an effect, restoring legality, the measure may be revoked and the company ‘returned’ to the administrators. Otherwise, but as things stand there are precedents in this regard, the company may be confiscated.

Judicial practice provides us with a further interesting fact: the use of this tool is often almost an alternative to the ‘traditional’ criminal trials held under Legislative Decree 231/2001 against entities (but this is not always the case), as it allows the objective of strengthening and spreading the culture of corporate compliance & business integrity to be achieved more quickly.

The leading cases of the Court of Milan teach us that situations of systematic non-compliance with labour law, especially in the case of labour-intensive service contracts, can entail serious risks for the client company:

1) prevention proceedings against the client company pursuant to Legislative Decree 159/2011;

2) criminal proceedings against the top management of the client company;

3) proceedings against the client company pursuant to Legislative Decree No. 231/2001.

Preventive duties, possible remedial actions and concluding remarks

The picture described above reveals a progressive affirmation of the preventive approach in place of the punitive (‘traditional’) one, and this is especially true with reference to the subject of criminal labour law (but not only) .

In fact, a similar trend can also be traced in the area of tax offences and tax evasion – topics closely linked to illicit intermediation and exploitation of labour – where the Public Prosecutor’s Offices are acting in the same way in order to recover the undeclared revenue from illegal work.

The recalibration of the system, and the related widening of the scope of corporate criminal liability, is largely due to the pressure exerted on economic operators by the control authorities and public opinion.

Recent events in the news, the scourge of ‘white murders’, together with the first figures provided by the INPS Observatory for 2024, which show rising numbers, have in fact turned the spotlight back on the issue of safety at work.

In such a scenario it is therefore essential that companies correctly (and above all concretely) assess and manage risks, and at the same time continuously monitor the performance of their suppliers in order to avoid potential negative consequences on their business that could have devastating impacts in economic and reputational terms.

In a preventive perspective, it may then be advisable for the commissioning company, already in the contractual framework, to reserve the right :

– to carry out accesses and inspections, suitably traced and recorded, at the premises of contractors/subcontractors or suppliers

– to require the latter to periodically submit all documentation relating to occupational health and safety.

In addition to ensuring that compliance exists not only on paper but also in practice, an integrated approach to corporate compliance is recommended, e.g. by adopting organisation, management and control models pursuant to Legislative Decree 231/2001 that are tailored to the specificities of each entity and that interact synergistically with other compliance tools relating to privacy, supplier quality management (e.g. ISO certification or similar) and sustainability (e.g. sustainability reports).

It will then be advisable to adequately and constantly update the 231 safeguards, with respect to the standards and regularity of the organisation and the activities of contractors, subcontractors and suppliers.

In order to mitigate criminal risks, the contracting party will therefore be called upon to carry out an assessment of its procurement function – preferably entrusted to an impartial third party (so-called ‘Independent Compliance Assessment’) – which in some cases could also lead to a revision of the supplier list.

Also with a view to prevention, it would be preferable to implement internal procedures for the prior verification of the reliability requirements of contractors, subcontractors and suppliers to whom services are to be entrusted.

The aforementioned judgements are also useful where they point us to certain measures deemed unsuitable to prevent the risk of the occurrence of cases of labour exploitation: think of the mere cartular control of the code of conduct or the mere provision of a contractual ban on subcontracting.

Finally, the great potential of the adoption/implementation of a whistleblowing system should certainly not be underestimated, to be followed, after adequate training of personnel on the subject, by the creation of reporting channels aimed at bringing to light conducts of caporalato and similar.

Prevention is better than cure.