Italian prosecutors have placed the Italian branch of U.S.-based Caddell Construction under judicial control over allegations of labour exploitation tied to the construction of the new U.S. consulate in Milan, according to judicial documents reviewed by Reuters on Friday.
The investigation centres on claims that hundreds of Indian workers recruited for the project faced excessive working hours, underpayment, threats of dismissal, and unsafe conditions at the construction site in northern Italy. Authorities said the alleged abuses took place while the company worked on a nearly $210 million diplomatic construction project launched in 2022.
According to Reuters, the Carabinieri labour protection unit imposed emergency judicial control on the company’s Italian division as part of a broader crackdown by Milan prosecutors on labour exploitation across several industries.
A 103-page judicial decree accused the company of recruiting workers in India through an intermediary agency in New Delhi and subjecting them to “exhausting shifts, underpaid, without safety protections and under the constant threat of dismissal,” Reuters reported.
Caddell Construction, its Italian subsidiary, and the U.S. embassy in Rome did not immediately respond to Reuters requests for comment.
The decree stated that Caddell’s Italian branch employed between 311 and 394 workers during 2025, including 316 Indian nationals. Prosecutors said the workforce had fallen to 261 employees by February 2026.
Italian authorities said the workers were allegedly required to pay around 500,000 Indian rupees, or approximately $5,225, to secure 36-month contracts and travel to Italy. Statements collected from 35 workers formed part of the investigation.
“I had to sell my wife’s gold and ask friends and relatives for a loan, which I will then have to repay,” worker Gopal Nayak said in testimony cited by Reuters.
Investigators said workers initially signed employment contracts in India written in English, despite many labourers stating they could not read or understand the language. Two workers reportedly told investigators they were illiterate.
According to the decree, the contracts promised hourly wages ranging from €1.31 to €1.91 and stated that food and accommodation would be covered by the employer. Prosecutors said workers later signed a second contract after arriving in Italy that complied with Italian labour law, but copies were allegedly never provided to them.
The Carabinieri investigation found that many workers laboured 12 hours per day, six days a week, exceeding Italy’s legal 40-hour workweek limit.
Authorities also alleged that workers earning between €1,300 and €1,500 per month lost roughly €800 through deductions for accommodation and meals that had not been disclosed in advance.
“Every month I sent €300 to India to support my three children, my wife and my brother,” worker Manoj Kumar told investigators, according to Reuters. “I was left with just a bit of money to buy dinner.”
Judicial documents also alleged that supervisors threatened workers with dismissal and deportation if they refused conditions at the site. Italian news agency ANSA reported that prosecutors are also investigating a Turkish-born manager connected to the company’s Italian operations.
Construction on the new U.S. consulate in Milan began in 2022 after Washington awarded the project to Caddell Construction, an Alabama-based firm specialising in embassy and military infrastructure projects. According to the company’s website cited by Reuters, Caddell has completed projects worth more than $24 billion across 38 countries.
The Milan consulate project was originally scheduled for completion in 2025, but Reuters reported that the timeline has since been extended to 2028.
Italian prosecutors said judicial control would not stop construction work at the consulate site. Instead, a court-appointed administrator will oversee compliance with labour regulations and supervise the regularisation of workers currently employed on the project.
The case forms part of a wider labour enforcement campaign launched by Milan prosecutors over the past three years. Italian authorities have previously targeted logistics firms, delivery companies, and fashion manufacturers over allegations involving migrant labour exploitation and wage violations.
The investigation also carries diplomatic sensitivity because the alleged abuses are linked to the construction of a U.S. diplomatic facility in Italy. Neither the U.S. State Department nor Italian government officials publicly commented on the investigation by Friday evening.
Background
Italy has intensified investigations into labour exploitation networks involving migrant workers in construction, logistics, agriculture, and manufacturing sectors since 2023. Prosecutors in Milan have increasingly used judicial control measures that allow companies to continue operating while court-appointed administrators enforce compliance.
Indian migrant workers have become a major source of labour in several European construction projects in recent years. Italian authorities have previously warned about recruitment schemes involving large placement fees and misleading employment contracts arranged through overseas intermediaries.
Caddell Construction is a major U.S. government contractor that has worked on embassy compounds, military facilities, and federal infrastructure projects worldwide.
What Happens Next
The judicial control order must be formally validated by an Italian judge in the coming weeks, according to Reuters. Court-appointed administrators are expected to review employment contracts, payroll systems, and accommodation arrangements linked to the Milan project.
Italian prosecutors are continuing interviews with workers and reviewing recruitment practices tied to the New Delhi intermediary agency identified in court documents. Construction work on the consulate project is expected to continue while the investigation proceeds.
