Ministers have serious questions to answer on the growing scandal at P&O Ferries and must make it a catalyst to improve workers’ rights, the Trades Union Congress said on Sunday.
The TUC accused the government of sitting on its hands and failing to protect workers after P&O sacked 800 staff on Thursday with a plan to replace them with cheaper agency workers. It has emerged that ministers were informed in advance about the mass redundancies.
The TUC’s general secretary, Frances O’Grady, demanded the government “urgently bring forward an employment bill to stop workers from being treated like disposable labour – and make sure what happened at P&O never happens again”.
She accused ministers of failing to challenge P&O on what she called “unconscionable tactics – or even question whether these actions were legal”.
O’Grady called on the company to immediately reinstate all sacked staff, without any loss of pay.
The chancellor, Rishi Sunak, criticised the treatment of workers by the ferry company.
“What we are seeing is appalling, the way that they have treated their workers, it is awful, it is wrong,” Sunak told the BBC.
He added that ministers were examining the company’s actions and whether they complied with regulations on dismissing workers.
Employment lawyers reacted with surprise to the company’s move to sack 800 seafarers out of the blue, and said that P&O Ferries may have broken several laws, potentially leaving it open to claims of unfair dismissal.
Over the weekend, angry protests were held at ports across the UK. Trade union leaders and politicians joined sacked P&O Ferries workers in Dover, Hull, Liverpool and Larne amid growing rage over the company’s decision, with more protests planned for the coming days, including outside parliament on Monday.
On Sunday, P&O warned customers that its services would be “unable to run for the next few days”.
The company said it was “advising travellers of alternative arrangements” for its cross-Channel and Irish Sea routes.
P&O Ferries has been accused of looking to exploit a loophole in minimum wage laws, in order to bring in cheap workers to crew its vessels.
The firm has previously been accused of hiring workers for as little as £1.83 an hour. Union officials have said P&O may be able to cut its wage bill by up to half by using agency workers instead of existing staff.
The Rail, Maritime and Transport union (RMT) said it had discovered that new crew on ships on the Liverpool-Dublin route will be paid at rates well below the minimum wage.
The RMT general secretary, Mick Lynch, said there was no effective way to stop the company from paying workers less than the minimum wage and called for new employment legislation to protect seafarers.
“We fear poverty pay will be accompanied by seafarers being chained to 12-hour day, seven-day week contracts that operate continuously for six months, with no pension,” he said.
The RMT has called for a boycott of P&O services.
Concerns have also been growing over a £146m deficit in the seafarers’ industry pension scheme, which is owed by P&O Ferries and its parent company DP World.
It is thought the taxpayer could be liable for the shortfall in the Merchant Navy Ratings pension fund, which includes retired P&O crew, if it was left unpaid.
DP World, one of the world’s largest port operators, is owned by Dubai’s sovereign wealth fund.
It bought P&O Ferries for the second time in 2019, for $322m (£244m), having sold it earlier in the decade.
Losses at the business are thought to have escalated in recent months, after disruption to travel during the Covid-19 pandemic, combined with increased post-Brexit paperwork for cross-Channel services, and the rising cost of diesel.
DP World also owns the London Gateway port, which was opened as the first of the controversial freeports championed by Sunak, and established by the government last year.
Sunak said on Sunday the government was examining all of its commercial relationships with P&O Ferries.
A spokesperson for P&O Ferries said it had taken the decision to make 800 staff redundant “as a last resort and only after full consideration of all other options”, after it made a £100m loss.
“Ultimately, we concluded that the business wouldn’t survive without fundamentally changed crewing arrangements, which in turn would inevitably result in redundancies,” they said.
