As protests continue over the sacking of 800 employees, questions surrounding workers’ rights are at the forefront of the news. Was the termination legal and if so, what are the workers’ rights?
In March 2022, P&O Ferries dismissed nearly 800 employees, some of whom were notified over a three-minute-long pre-recorded message. This sparked huge protests at ports across the country against potentially unlawful treatment the workers have received. The crew were also immediately replaced by new inexperienced employees which was highlighted as a possible health and safety risk for passengers.
The incident draws parallels with the mass dismissal of 700 Gate Gourmet employees in 2005. A proportion of the workers were subsequently rehired on lower pay, selected for compulsory redundancy, or persuaded into a voluntary redundancy. Upon trying to challenge the redundancy based on unfair dismissal grounds, the employees lost the tribunal case.
The Chief Executive of P&O Ferries, Peter Hebblethwaite, stated that the unions were not involved in the decision-making process. The company has replaced the workers who earned £9.50 an hour on average with a new agency that provided the workforce with the starting rate of £5.15 to cut costs and keep the company afloat. Despite the UK’s minimum wage being £9.50, the new pay set by P&O Ferries would still be legal because it is regulated by international maritime law. The company has argued that negotiations with the union would have been unproductive as it was clear that the company believed that the employees would never accept the changes in employment. P&O Ferries confirmed that they will pay £36.5 million as compensation for the sudden nature of the dismissal. Professor Catherine Bernard (University of Cambridge) had described this as an “efficient breach” of the UK employment law, that is being used to recover the loss of over £100 million due to the loss of business during COVID-19.
Under retained EU law, collective redundancies of 100 or more employees require 45 days of mandatory notice to the relevant authorities. Further, there must be time for consultation with employees and usually the unions. The company is also required to submit a notice to the governments of each country they are registered in, to gain advice on the number of redundancies and to consider alternative suggestions as well as further steps to be taken to help those made redundant. For P&O Ferries, this meant they had to notify in Cyprus, Bermuda, and the Bahamas. They failed to do this. Following the mandatory notice and governmental forms, the employees would have a chance to consider the proposal and respond to their given options. This also did not occur.
The failure to consult would allow the workers to bring a claim for 90 days' pay for each employee unfairly dismissed as well as any other differing individual claim. However, despite the distress and damage this caused to families, many had already agreed to take the payment offered by P&O Ferries to avoid a court battle that may last for years. For most of the employees, this would be unaffordable.
The pressure (from protests and petitions) on the government to enact some form of protective legislation over this scandal is immense. Several members of Parliament have stated their views on this injustice, including the Business Secretary, Kwasi Kwarteng. In a letter to P&O Ferries, Kwarteng outlined the government’s “anger and disappointment” over the scandal and requested to justify the breach of law.
The former employees face an uphill struggle in challenging the terminations. Similar past examples of mass redundancies, such as those by Irish Ferries (2005) and Gate Gourmet (2005) saw attempts to legally challenge the terminations prove unsuccessful. In addition, all but one of the former P&O Ferries employees had previously accepted the offer of compensation by the company, which may affect their case.
There are now calls for a ban on ‘fire and rehire’ practices, where workers are made redundant to replace with far lower-paid employees. If such legislation is implemented, it will protect employees against mass redundancies and will allow meaningful court intervention for cases such as Gate Gourmet and P&O Ferries.
By Viktoriia Sereda student of Law at Queen Mary University of London.