UK launches investigations into P&O Ferries' mass firings

"Following its enquiries, the Insolvency Service has commenced formal criminal and civil investigations into the circumstances surrounding the recent redundancies made by P&O Ferries. As these are ongoing investigations, no further comment or information can be provided at this time," a statement released by the UK Insolvency Service said.

In the wake of the P&O Ferries staff firings, the UK Government has sought to improve wages for seafarers working in UK waters and ports, requiring firms with ships operating in the country to pay the minimum wage. 

UK Transport Secretary Grant Shapps has written to France, the Netherlands, Ireland and Denmark to propose bilateral agreements to make routes between the countries ‘minimum wage corridors’ where nationals from either country must be paid an agreed minimum wage. And the government said it has asked International Maritime Organization (IMO) to hold an international summit to discuss workers’ rights at sea and to revise seafarers’ basic pay rates.

The UK Government said its own minimum wage requirement would mean that "more than 21,000 seafarers across the UK will no longer be undercut and puts the UK ahead of any EU state in its protection on pay".

P&O Ferries has replaced the fired crew with agency staff members, whose wages are as low as US$3 per hour.

UK Prime Minister Boris Johnson also said the government would take P&O Ferries to court. “We will defend the rights of British workers… P&O plainly aren’t going to get away with it,” he said in Parliament. 

However, transport secretary Grant Shapps later said that the government are not in a position to take court action.

Mr Shapps reportedly said he had asked the Insolvency Service to consider disqualifying P&O Ferries chief executive Peter Hebblethwaite for breaking the law but added, “It is, of course, for the Insolvency Service to decide what happens next.”

Sweden-based Stena Line executive director Ian Hampton said he backed the UK Government’s legal protections for workers.

"Stena Line welcomes the package of changes proposed to address the present inequalities that exist for seafarers working on regular ferries services to and from the UK," Mr Hampton said. 

"We have a long-held strategy of employing local seafarers on board our vessels. Today’s announcement protects that strategy and in addition creates the necessary consistency and equality needed across the sector."

23 March 2022

Speaking in Parliament, UK Prime Minister Boris Johnson said P&O ’probably’ broke the law and that forthcoming legislation will ensure UK seafarers receive living wage after P&O Ferries fired 800 of its workers

The Prime Minister claims centred on P&O Ferries’ handling of the mass redundancy of some 800 of its workers on ferries operating in the UK.

If found guilty, the company could face millions of dollars in fines.

Law firm Reed Smith said companies can face financial sanctions for failure to notify and consult with unions before laying off staff. 

"For UK-based staff, it is hard to see how there would be any defence to this if there has been no prior warning at all of the dismissals. In that scenario, realistically the employer would be hit with the full penalty of 90 days’ pay per employee (25% of the annual wage bill)," Reed Smith employment law partner David Ashmore said.

"The question now is whether the unions/employees will be pushing for a figure that reflects their full rights."

Trade union RMT claimed on 22 March that a redundancy package offered to P&O Ferries’ employees had been structured so that employees had to choose to take the package and forfeit rights to an employment tribunal or to lose the compensation offered them. RMT said they would continue to push for employees to be reinstated.

The UK Prime Minister also said the UK Government will legislate to ensure all workers in the UK economic zone are paid the living wage, "as fast as we possibly can," which, if enacted, could close a loophole allowing employers to pay seaferers lower wages. 

Labour union RMT reported that wages for the agency-hired crew who are replacing the 800 P&O Ferries crewmembers who have been made redundant is equal to US$2.38 per hour, and Labour’s emergency vote also sought to outlaw the practice of firing and rehiring staff on lower wages.

P&O Ferries chief executive Peter Hebblethwaite has reportedly apologised to the employees affected, their families and the 2,200 people who still work for P&O.

P&O Ferries has also said it is paying the group of employees it laid off a total of £36.5M (US$48.2M) in compensation, as part of what the company reportedly said was the "largest compensation package in the British marine sector". The payouts are linked to the length of time employees have worked for P&O Ferries.