The Trades Union Congress has urged the government to make crucial changes to legislation planned to help seafarers after the P&O Ferries scandal, warning that loopholes otherwise remain that unscrupulous employers could exploit.
P&O Ferries admitted deliberately flouting the law when it sacked 786 seafarers and replaced them with low-paid agency crew last March. Despite public outrage and condemnation, and pledges of action from government ministers, the Dubai-owned operator received no fine or sanction – even though its chief executive, Peter Hebblethwaite, told MPs the firm had knowingly decided to break labour law.
Ministers instructed the Insolvency Service to consider the case, initially warning that P&O faced an “unlimited fine”. However, the Insolvency Service decided it could not bring a prosecution.
In July, the Department for Transport introduced a seafarers’ wages bill in response to the scandal, designed to ensure that vessels regularly working in British waters paid at least minimum wage.
But after a legal briefing from the Insolvency Service to maritime unions outlining the reasons why P&O was not prosecuted, the TUC has called on the government to close critical loopholes in the legislation.
In a letter to Lady Vere, the transport minister responsible for the maritime sector, it urged changes that would tackle uncertainty over whether, in the P&O example, the sacked crews legally worked in Britain, despite operating out of Britain’s Channel or North Sea seaports and living in the UK. P&O’s British seafarers were paid via an offshore P&O office in Jersey, and the vessels were flagged in Cyprus, the Bahamas or Bermuda.
While P&O failed to notify either the secretary of state or the flag state of the ferries at least 45 days before, as the law requires for mass redundancies, the Insolvency Service said it did not pursue criminal charges against P&O because of “a lack of legal clarity”, for the purposes of the relevant trade union and labour law, “whether the dismissed seafarers worked outside Great Britain”.
Frances O’Grady, the outgoing general secretary of the TUC, said: “The P&O scandal showed us cowboy capitalism at its very worst.
“Despite behaving like corporate gangsters, P&O Ferries has been allowed to get away scot-free because of lax labour laws – and its owner has even registered eye-watering profits on the back of the mass sacking.
“Instead of attacking workers’ right to strike, the government should put in place proper protections for workers who are at the mercy of bad bosses.
“Ministers must use the seafarers bill to close the legal loopholes that allowed P&O Ferries to escape criminal proceedings. Tinkering around the edges won’t cut it.”
P&O Ferries has continued to operate services out of Britain as before, while its owner, Dubai-based DP World, is set to run freeports designed by the prime minister, Rishi Sunak.
Other operators such as Stena Line have since spoken of the pressure to follow suit in cutting wages, observing that P&O has set an international precedent.
O’Grady added: “Let’s be clear. Without stronger regulation, another P&O-style scandal is on the cards.”
A spokesperson for the Department for Transport said: “We reacted swiftly and decisively against P&O Ferries’ appalling treatment of its staff, announcing a nine-point plan to improve pay and conditions and introducing a seafarers’ wages bill to ensure those with close ties to the UK are paid at least the equivalent to national minimum wage.
“We continue to work with our European neighbours, unions and industry partners to further protect seafarer welfare and pay and we will formally respond to this letter in due course.”