The chief executive of P&O Ferries came before our transport select committee in parliament last week and told its legislators that it had consciously chosen not to operate within the laws which we set. Worse still, he said he would do so again.
P&O Ferries has rightly been condemned for this defiant declaration. The secretary of state for transport and the prime minister have echoed calls that the chief executive, Peter Hebblethwaite, should resign.
What P&O Ferries has also done is to provide an audit of parliament’s employment laws and the powers of government and its agencies to enforce them. The conclusion: the laws, and those who seek to enforce them, are not strong enough to withstand this act of corporate piracy.
In failing to abide by the redundancy consultation process, and effectively firing its seafaring workforce on the spot and compensating them for the lack of consultation and notice, P&O Ferries sets out a strategy to buy its way out of the rule of law. We heard from lawyers that this was largely without precedent. It isn’t now. The government must immediately disabuse the corporate world that this is a free and available option.
Currently, the only redress for P&O workers is to go to an employment tribunal. This could take a year, will be too late and won’t deliver additional financial redress. Government agencies need the power from parliament to take out an injunction to retain consultation rights before they are lost.
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Those, such as Hebblethwaite, who consciously decide to ignore the law, must be subject to greater personal and criminal liability. Unlimited government fines should be priced in for companies who decide, like the board of P&O Ferries, that it is more economically prudent to trade-in workers rights for commercial expediency.
It is not just the sacked P&O Ferries workers who deserve more protection. The replacement workers, drafted in from overseas, are being paid as low as £5.15 an hour. Perhaps P&O Ferries believes that it is being generous.
According to the international maritime pay scales, rates can go below £2. The national minimum wage, for workers onshore in Dover and Calais, is close to £9 thanks to UK and French protections. Parliament and government need to find a way, via legislation or licensing relating to conditions of carriage or docking, to apply the national minimum wage to all who crew our daily ferry services.
In our select committee hearing, the issue of where the vessels were registered came up time and again. P&O Ferries transferred registration to Cyprus and the Bahamas. These flags of convenience have turned out to be incredibly inconvenient when it comes to enforcing laws and ship safety protections.
It’s time to bring the flags back home. This will ensure that the Maritime and Coastguard Agency has one sole UK rule book on safety and the Insolvency Service has similar certainty around redundancy notification provisions.
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Our committee came to the conclusion that both agencies need greater powers and to act with more urgency. The next day, the coastguard detained a ferry at Larne after the shortcomings of the new crew caused the agency to deem it “unfit to sail”.
In a further welcome development, Grant Shapps, the transport secretary, has ramped up the rhetoric and committed to action. I’m convinced that he comprehends not just the impact on our laws and maritime safety but also the political ramifications.
Following the capture of the red wall, the Conservative Party has designated itself as the party of the workers. This could itself be seen as a flag of convenience if talk is not accompanied by action. Measures will be introduced to parliament this week. We await details. It’s essential that the government acts robustly and immediately.
Our employment regulation landscape has delivered flexibility for businesses to expand and create new jobs. P&O Ferries has taken UK plc aback with an aggressive strategy that shows contempt for workers and parliament. They are putting not just their workforce at risk but harming the case for deregulation.
We need to close the loopholes that P&O Ferries has exploited. The gloves are off; it’s time to meet fire with fire.
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Huw Merriman is chairman of the transport committee
Also in Red Box today:
•Jo Grady: Respect staff or British universities will see a brain drain
•James Purnell: I drafted the 50 per cent target for universities, now let’s go further
•Jamie Driscoll: The chancellor’s spring statement was missing five things
