Transport Secretary Grant Shapps has called for the boss of P&O Ferries to resign and vowed to force the company to pay its crews the minimum wage.
It comes after chief executive Peter Hebblethwaite admitted the ferry giant broke employment law when it sacked 800 workers without notice. Mr Hebblethwaite told a Commons hearing on Thursday (March 24) that the company made the choice to sack staff without consultation, thus breaking the law, because: "no union could accept our proposals".
P&O has faced heavy criticism since it announced the mass redundancies. Hundreds of people gathered outside the main entrance of the Port of Liverpool in Seaforth on March 18 in protest against the sackings.
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At the protest, Liverpool City Region Mayor Steve Rotheram called the firings a "disgrace", while Greater Manchester Mayor Andy Burnham called for a boycott of the company. Sefton Central MP Bill Esterson said: “For loyal workers with years of experience to be summarily sacked with no warning at all is an outrage. It is draconian and Dickensian from P&O’s parent company DP World.
Adding to the criticism and responding to the news that P&O's sackings broke the law, Mr Shapps told Sky News on Friday (March 25): “I thought what the boss of P&O said yesterday about knowingly breaking the law was brazen and breathtaking, and showed incredible arrogance. I cannot believe that he can stay in that role having admitted to deliberately go out and use a loophole – well, break the law, but also use a loophole.”
Pressed on whether that meant he was calling for Mr Hebblethwaite to resign “right now”, Mr Shapps said: “Yes.” On Thursday (March 24), Mr Hebblethwaite was urged by MPs to quit after acknowledging there is “absolutely no doubt” the ferry operator was required to consult with trade unions.
The company replaced its crews with cheaper agency workers last week. The company resumed services between Liverpool and Dublin with agency staff, leading to West Derby MP Ian Byrne urging people to boycott the "scab vessel".
Mr Hebblethwaite admitted that the new crews are being paid below the UK’s minimum wage apart from on domestic routes, but insisted this is allowed under international maritime rules. The chief executive, whose basic annual salary is £325,000, revealed that the average hourly pay of the new crew is only £5.50.
The minimum wage in the UK for people aged 23 and above is £8.91 per hour. Mr Shapps said the Government is planning to change the law to ensure companies working from British ports pay people the minimum wage, as he condemned P&O for “evilly exploit(ing)” loopholes.
He said the move from the Government would force a “U-turn on what’s happened at P&O". He continued: “What I’m going to do … is come to Parliament this coming week with a package of measures which will both close every possible loophole that exists and force them to U-turn on this.
“We are not having people working from British ports … plying regular routes between here and France or here and Holland, or (anywhere) else, and failing to pay the minimum wage. It’s simply unacceptable and we will force that to change.”
Speaking to BBC Breakfast, Mr Shapps said the Government “can’t directly” revoke P&O’s licence when asked why the company was still operating after having broken the law. He said he had instead asked the Maritime Coastguard Agency to carry out “very detailed inspections”.
The minister said if new crews were being paid under national minimum wage and found to be unfamiliar with equipment, the ships would be deemed unsafe to sail. Mr Shapps also said P&O Ferries had “attempted to pay off their staff with higher redundancy payments … and therefore buy their silence”.
Mr Hebblethwaite on Thursday told a joint session of the Commons’ transport and business select committees that Mr Shapps knew about the intention to cut jobs in November last year, although that was strongly denied by the Department for Transport. Asked about the claim, Mr Shapps said it was a way to “distract attention” from its failure to provide notice of job cuts.
The Transport Secretary also said he he “didn’t see” an email sent round Whitehall about P&O’s plans the night before the mass sackings and was told “at the despatch box”. Asked who the email would have been sent to if not the transport secretary, he said: “Well, I think it was sent to a very small group of officials in order to record a conversation, the notes of a conversation that happened.”
Mr Shapps added: “Frankly, even if I had known the night before, which I didn’t, they’d already broken the law by not providing 45 days’ notice, by using the Cyprus flag to get around it.”
