P&O Ferries boss admits firm 'chose' to break the law by sacking 800 workers

24 March 2022, 12:25 | Updated: 24 March 2022, 13:16

Peter Hebblethwaite answered questions in front of the Transport Committee and Business, Energy and Industrial Strategy Select Committee
Peter Hebblethwaite answered questions in front of the Transport Committee and Business, Energy and Industrial Strategy Select Committee. Picture: Alamy

By Emma Soteriou

The CEO of P&O Ferries has admitted to MPs that the decision to sack all 800 of its workers without consulting unions broke the law.

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He said there was "absolutely no doubt" that the firm was required to consult unions before making its decision to make the major cuts.

Speaking during a one-off P&O evidence session, Peter Hebblethwaite explained: "I completely throw our hands up, my hands up, that we did choose not to consult.

"We did not believe there was any other way to do this to compensate people in full."

He added that a consultation on the new crewing model for the company would have been "a sham".

He said: "We assessed that given the fundamental nature of change, no union could accept it and therefore we chose not to consult because a consultation process would have been a sham.

"We didn't want to put anybody through that.

"We are compensating people in full and up-front for that decision."

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It came after Mr Hebblethwaite began the session by apologising for the way the company had dealt with the incident.

He told MPs: "Can I start these with an apology?

"An apology to seafarers that were affected on Thursday of last week, an apology to their families, an apology to the 2,200 of our employees who have had to face very difficult questions over the last week or so.

"You may see this as a late apology and I just want to reassure you the reason that you're hearing this for the first time today is because I've spent the last week in the business, talking to our people one to one."

Asked if he would make the same decision again with the benefit of hindsight, Mr Hebblethwaite added: "We weren't viable before, and I know that if we hadn't made radical changes the business would have closed, and I apologise for that.

"But genuinely, that would not have been 800 redundancies with substantial severance packages, that would have been 3,000 people losing their jobs."

Despite expressing his regret, Mr Hebblethwaite also confirmed that new employees would be receiving lower than the minimum wage in the UK.

He said the average hourly pay of P&O Ferries' new crew is £5.15 per hour, telling MPs: "On the routes that are international routes, that are governed by ITF (International Transport Workers' Federation) standards, we are paying above ITF minimum wages."

Business committee member Andy McDonald said: "That's below the national minimum wage of this country.

"How do you reconcile that?"

Mr Hebblethwaite replied: "Where we are governed by national minimum wage, we will absolutely pay national minimum wage.

"This is an international seafaring model that is consistent with models throughout the globe and our competitors."

P&O Ferries announced it was offering more than £36 million in compensation to sacked staff, with 40 employees in line for payments of more than £100,000.

The company said payouts would be linked to the period of service, and in some cases exceed £170,000.

It comes as a spokesman for Business Secretary Kwasi Kwarteng confirmed the Government had received a letter from P&O Ferries in response to his questions about the shock move by the 5pm deadline on Tuesday.

The total value of the settlement is £36,541,648, with no worker set to receive less than £15,000, the company said.

Hundreds of workers were fired without notice last week, sparking backlash from across the political spectrum.

Employees are being given support to find a new job at sea or onshore.

Transport Secretary Grant Shapps has said the Government will legislate to close a "loophole" in the law which P&O had sought to exploit.

Mr Shapps told broadcasters the actions of the company in sacking 800 British workers were "unacceptable".

"We think that the P&O management have exploited a loophole here in order to sack British workers, bring in very some very low paid international workers. We don't think that's right," he said.

"Next week we will be returning to Parliament with a package of measures to make sure that situation is undone. We will change the law to make that happen."