Yahoo Finance P&O Ferries: Boris Johnson says sackings may amount to breaking the law
UK prime minister Boris Johnson said the government "will not sit by" over P&O's sacking of seafarers without notice over a video meeting last week.
Johnson, who made the comments during Wednesday's prime minister questions, said the company may have broken the law when it sacked the crew members and could face millions in fines if it has.
It comes as ferry operator P&O Ferries announced on Wednesday that it will pay out £36.5m ($48.3m) in compensation to the 800 seafarers it sacked.
P&O is offering two-and-a-half weeks’ salary for each year of employment, as well as up to 13 weeks’ pay in lieu of notice, and another 13 weeks’ stipend due to the absence of a consultation period.
Some crew members are in line for payouts of as much as £170,000, with more than 40 employees due to get over £100,000 each, and no one will receive less than £15,000, the company said.
The compensation package was the basis for offers made to crew members at the time of dismissal, it said. P&O said it believed the settlement is believed to be the "largest compensation package in the British marine sector".
The company added 575 out of the 786 sacked employees are in talks over the severance and some are set to receive 91 weeks' pay and the chance of new employment.
However, trade unions representing crew members have said the package was "pure blackmail and threats" and that the "pay in lieu of notice was not compensation"
"If staff do not sign up and give away their jobs and their legal right to take the company to an employment tribunal they will receive a fraction of the amount put to them," said RMT union general secretary Mick Lynch.
Read more: P&O sackings lead to mass protest as UK warns of 'ramifications'
The announcement comes after UK business secretary Kwasi Kwarteng wrote a letter to chief executive Peter Hebblethwaite demanding an explanation as the government threatened P&O with "unlimited fine" over the widely-condemned move.
"Failure to meet the notification obligation is a criminal offence and can lead to an unlimited fine," Kwarteng said.
P&O Ferries has lost the trust of the public and has given business a bad name.
My letter to the Chief Executive of P&O Ferries following their decision to fire 800 staff on the spot. pic.twitter.com/nFBFz1JVVr— Kwasi Kwarteng (@KwasiKwarteng) March 18, 2022
The operator, owned by Dubai-based DP World made hundreds of its workers redundant in a Zoom (ZM) meeting with immediate effect last week Thursday after stopping all its sailings earlier in the day.
It said: "Our survival is dependent on making swift and significant changes now. Without these changes there is no future for P&O Ferries. These circumstances have resulted in a very difficult but necessary decision, which was only taken after seriously considering all the available options."
The eight ferries the sacked staff worked on, which service routes including Dover-Calais and Larne-Ciarnryan, are all registered in the Bahamas, Cyprus, or Bermuda.
In their place P&O has hired agency staff on as little as £1.80 per hour, according to the RMT union.
UK law requires employers to consult with trade unions and pay the legal minimum wage, now £8.91 an hour for employees 23 and older. However, maritime firms that sail in international waters can avoid these rules by registering their ships in other countries.
Read more: P&O Ferries fires 800 crew members as unions urge staff to stay on board
P&O had said last week that its business was no longer viable after making a £100m loss year-on-year.
The business, which hires around 4,000 employees in total, said back in May 2020 that it may have to make 1,100 redundancies due to the coronavirus outbreak.
Although P&O benefited from furlough support during the pandemic, as well as a freight support grant, it failed to secure a £150m bail out from the UK government.
As one of the UK’s leading ferry firms, P&O carried more than 10 million passengers a year before the pandemic, and was responsible for around 15% of all freight cargo in and out of Britain.
P&O operates four routes: Dover to Calais; Hull to Rotterdam; Liverpool to Dublin; and Cairnryan, Scotland to Larne, Northern Ireland.
Watch: P&O Ferries sackings: Replacing workers with £1.80-an-hour agency staff 'illegal', says TUC head Frances O'Grady
