The CEO of P&O Ferries has defended the brutal sacking of 800 staff members in a new letter.
Peter Hebblethwaite said the firm was forced to take the 'difficult but necessary' decision after losing £100million year on year.
Stunned staff found out their contracts had been 'terminated immediately' through a pre-recorded Zoom video today.
Some workers have since occupied one of the firm's ships in Hull, with captain Eugene Favier reportedly drawing up the gangplanks and refusing to let police aboard.
Hull's Labour MP Karl Turner described the mass redundancies as 'disgraceful' and backed Capt Favier in his protest against the company.
But Mr Hebblethwaite stands by his decision to replace the fired staff with agency workers who will reduce the firm's crewing costs by 50%.
Here is his letter in full:
Dear Colleagues,
By now I hope most of you had a chance to hear directly from your leaders and managers about the changes we’re making to our crewing model today to reduce our crewing costs by 50%, secure the future of our business and set it up for growth.
I’m getting in touch directly with all of you today because it’s important that that we all individually understand the changes we’ve made to our business today and why we’ve made them.
Before I get into the detail of the announcement I want to start by thanking you for all you’ve done so far today in handling disruption to our customers, and all I know you’ll continue to do in the coming days. I know it’ll be a challenging few days and your efforts are really appreciated by me and all the leadership team.
Why we’re making changes to our crewing model
As you know, here at P&O Ferries, we play a critical role in keeping trade flowing, supply chains moving, and connecting families and friends across the North and Irish seas and the Channel.
The Channel is a major supply route that delivers 59% of all UK trade with the European Union, with 33% of that trade passing through the port of Dover alone. Alongside these freight movements, 35 million tourists also cross the Channel every year.
These supply routes require both the sea operations and the Channel Tunnel to balance competition, value and service for freight and tourism customers.
We have been at the heart of this service for years and our shareholder and leadership team are committed to serving these routes.
These changes that we’re talking about today are part of DP World’s wider plan to support P&O Ferries to deliver the best for customers across freight and tourism industries. DP World is helping us invest in our future with new ships that will provide a better service for everyone, totalling £250M.
However, in our current state, we are not a viable business. We have made a £100M loss year on year, which has been covered by our parent DP World - this is not sustainable.
Our survival is dependent on making swift and significant changes now to protect the future of P&O Ferries, and jobs across the whole business. These circumstances have resulted in a very difficult but necessary and pivotal decision, which was only taken after seriously considering all the available options.
Without the changes we’re making today to our crewing model there is no future for P&O Ferries.
What are the changes and the support available
As of this morning, we are severing the contracts of all 800 Jersey-contracted seafaring colleagues with immediate effect and will be compensating them for lack of notice with enhanced severance packages.
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They are being offered support and being encouraged to access our employee assistance programme if they feel they need it, either now or in the coming days. As part of their package, they are also being offered careers advice and support.
Today we have entered into a new partnership with International Ferry Management (IFM) who are an international crewing company, and they will be responsible for providing new crews for all those ships affected by this change. Our new teams of seafaring colleagues have already joined our ships.
Our new crew are now going through a process of intense familiarisation and training programme on our ships, run by IFM. Only when that process has happened, will we gradually return to a normal service safely and securely - upholding our P&O standards and brand.
This new crew model will reduce our crewing costs by 50% and enable us to better compete and be more responsive to our customers’ needs. It is a model that is proven to work across the industry, while still allowing us to retain service and safety levels which are central to our operations.
As well as protecting our future, and jobs across the business we are also guaranteeing our customers a resilient, sustainable and competitive business and securing a quality service to the major trade routes of the UK.
We already have the strong fundamentals in place - the best ships, on the best routes, under the best brand. Several weeks ago we took the first step in transforming ourselves by restructuring our business so we’re set up for growth. The second, and most difficult, step is the one we’re making today – which will make us the most competitive business operator in the industry.
By taking these steps we’re bringing together our years of heritage with the forward thinking of our partner DP World, so that we can unlock the potential of our business for now and the long term.
What’s next?
I appreciate there is a lot to take in, and you may understandably feel surprised by the suddenness of this news.
These changes are so significant we were conscious of the inevitable disruption and uncertainty during any consultation period. Against that background we determined that it was better to take immediate action.
We are currently briefing all the colleagues directly affected whether they are on ships or on leave.
We know that some of you will have family or friends who are directly affected by this announcement so please be assured we’re doing all we can to support them at this time. If you are affected by this news do please take some time to absorb it.
Our Employee Assistance Programme is also available to you 24/7 if you want to speak to someone in confidence either now or in the days to come. The phone number is available in the Q&A document, which is attached and is also available on the Quick Link section of Connexions.
Please refrain from any public comment and direct any external enquiries to our press office, details of which are in the Q&A document. It is also essential that we avoid posting any comments or views on social media.
I am keen to speak to you directly this afternoon, so following this email I will be sending you an invite to join an All Hands call at about 2pm and 6pm today. I will talk through the same content at both so please join whichever call suits you and your working hours best.
We have a Q&A sheet with answers to many of the questions we think might be on your mind at the moment – please take a look here. If you have a question that isn’t covered in our Q&A sheet at the moment please submit your question here. We will then issue an updated Q&A sheet tomorrow and I will also invite you on a further All Hands call to go through your Top 5 questions.
I look forward to talking to as many of you as possible on the two schedule All Hands calls later today.
Kind regards,
Peter Hebblethwaite
CEO, P&O Ferries
