The decision to sack 800 staff via Zoom and replace them with cheaper agency workers seemed to surprise many. But there were signs of what was to come.
“Before I answer that question can I start please with an apology, an apology to the seafarers…”Peter Hebblethwaite, speaking to MPs
That was Peter Hebblethwaite, the chief executive of P&O Ferries, answering questions from a select committee of MPs last week.
They didn’t pull their punches…
“Mr Hebblethwaite, when I was reading your biography it seemed pretty light on your experience as a chief executive officer. Are you in this mess because you don’t know what you’re doing or are you just a shameless criminal?”Darren Jones MP
Peter Hebblethwaite took over the top job at P&O Ferries in November last year.
And he was in the hot seat… facing down MPs… because it was under his watch that 800 P&O staff were sacked, on the spot, over a Zoom call earlier this month.
“The company has made the decision that its vessels going forward will be primarily crewed by a third-party crew provider. Therefore I am sorry to inform you that this means your employment is terminated with immediate effect on the grounds of redundancy. Your final day of employment is today…”P&O Boss speaking over Zoom, Sky News
People who had worked on the company’s ferries for decades were told they had just hours to collect their belongings… all overseen by security staff sent to deal with any unrest amongst the crews.
Some even watched as the people replacing them were brought in. They will be paid an average of just £5.50 an hour, much less than the minimum wage.
“There was grown men crying on there… there’s people that have got families and they need to know what they’re going to do next. And redundancy is okay – the money’s okay – but it’ll soon run out. People want a reliable job and not one member of staff who has come off that ship wanted to leave…”RMT Union rep speaking to Channel 4 News
It’s a move that caught nearly everyone off guard.
But how did we get here?
P&O Ferries is owned by DP World, an Emerati logistics company that’s controlled by Dubai’s Sheikh Mohammed bin Rashid al-Maktoum.
It’s unclear – as yet – where exactly the impetus for this restructuring decision came from.
But P&O Ferries has been upfront about the reason.
The company has lost £100m over the past two years and says its business simply wasn’t viable with the way it currently staffed its ships.
Despite claiming £10m in furlough money from the government during the pandemic… P&O Ferries claims that replacing 800 seafarers with foreign agency staff was the only way to save the jobs of their other 2,200 employees.
And it’s not just the decision itself that’s caused outrage. It’s the way it happened without warning or consultation…
“I’m absolutely staggered. I mean I look back on the corporate failures in terms of PR and the way you treat your employee and this one has to come right at the very top. It’s come out of nowhere, I’m not entirely sure it can be legally valid…”Huw Merriman MP speaking to Channel 4 News
that something like this has happened in the industry.
There’s a blueprint.
Back in 2005 Irish Ferries replaced all its staff with cheaper agency workers. It caused huge controversy but fundamentally the company got what it wanted and was able to undercut its rivals.
Then, last year, Irish Ferries started running a service on the highly competitive route from Dover to Calais… and Irish Ferries were noticeably cheaper than P&O.
Not long after… P&O Ferries brought a ship it had been trying to sell, called the Pride of Burgundy, back into service. It crewed it with agency staff who worked for extended tours of duty on lower wages, angering trade unions.
It might sound familiar… but according to the Sunday Times, a spokesperson for P&O Ferries has denied that it was a “dry run” for what happened earlier this month.
So, did they break the law?
“Under section 194 of the trades union and labour relations act of 1992, it looks to me, Mr Speaker, as though the company concerned has broken the law. And we will be taking action therefore, and we will be encouraging workers themselves to take action under the 1996 employment rights act…”Boris Johnson speaking in the House of Commons, The Guardian
That’s Boris Johnson speaking in the House of Commons last week. The prime minister was clear that – in his opinion – P&O had broken the law.
In reality… things might be a little more complicated.
Section 194 of the Trades Union and Labour Relations Act of 1992 says that firms are supposed to notify the UK government before they sack 100 people or more.
But that changed in 2018. Companies like P&O now just need to inform the governments of the countries where the boats are registered. In this case that includes the Bahamas, Bermuda and Cyprus.
When he addressed that committee of MPs last week… chief executive Peter Hebblethwaite said that P&O had informed the relevant governments… although not, it seems, with the required amount of advance warning.
And he admitted, clearly, that the company had not consulted employees and their unions as required.
“Peter Hebblethwaite: There is absolutely no doubt that we were required to consult with the unions. We chose not to do that because…Peter Hebblethwaite speaking at a commons select committee, Sky News
Andy McDonald MP: You chose to break the law?
Peter Hebblethwaite: It was our assessment that the change was of such a magnitude that no union could possibly accept our proposal…
Andy McDonald MP: Oh you’re right about that Mr Hebblethwaite… I’ve never heard such farcical answers to a series of questions.”
The company could be prosecuted and despite a compensation package that totals £36.5m – meaning no employee will receive less than £15,000 – the crew could have the option to take P&O to tribunal.
For P&O… no matter what happens next… it’s a PR disaster. Following Peter Hebblethwaite’s much criticised performance in front of MPs, the transport secretary Grant Shapps called on him to go.
“What the boss of P&O said yesterday about knowingly breaking the law was brazen, breathtaking… and showed incredible arrogance. And I cannot believe that he can stay in that role.”Grant Shapps, Sky News
The Prime Minister agreed and over the weekend pressure mounted. There were protests at ports…
[Short clip from protests]
And a P&O ferry was detained by the authorities because of safety concerns.
“This is the latest news since last night. The maritime and coastal agency has detained a ship, The European Causeway ship…”News report
And this whole saga has also led to some criticism of the government.
Labour has slammed ministers for failing to outlaw “fire and rehire” practices. And Downing Street has admitted that the Department for Transport knew of P&Os plans the day before.
But for the crew and their families suddenly facing an uncertain future in the midst of a cost of living crisis… a row over who knew what and when will be little comfort.
Today’s story was written by Claudia Williams and produced by Imy Harper.
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