P&O Ferries Redundancies

Ian Lavery Excerpts

Tuesday 28th March 2023 Westminster Hall

[Sir Gary Streeter (in the Chair)]

In a moment, I will call Ian Lavery to move the motion. I will then call the Minister to respond to the debate, but I think that in between the two Mr McDonald will make a very short speech. There will not be an opportunity for the Member in charge to wind up, as is the convention in our 30-minute debates.

[Ian Lavery (Wansbeck) (Lab)]

I beg to move,

That this House has considered lessons learned from redundancies at P&O Ferries.

I refer to my entry in the Register of Members’ Financial Interests, with regard to my trade union membership. It is a pleasure, as always, to speak under your chairmanship, Sir Gary.

It is worth looking back at what actually happened to the 786 staff who were dismissed by P&O Ferries and DP World on 17 March 2022. We remember watching staff on the television who reported being sacked in a pre-recorded Zoom call, without prior warning or indeed any consultation whatsoever. P&O had callously prepared beforehand, recruiting handcuff-trained private security guards in balaclavas to frogmarch employees off the P&O vessels.

The P&O chief executive, Peter Hebblethwaite, admitted to the Transport Committee that the company had deliberately ignored the law and that some of the agency crew replacing those sacked would be paid below the minimum wage; and astonishingly, he said that the company would do it again, given the opportunity.

[Jim Shannon (Strangford) (DUP)]

Will the hon. Gentleman give way on that point?

[Ian Lavery]

The hon. Gentleman will have to be very brief.

[Jim Shannon]

I commend the hon. Gentleman for securing this debate. Does he not agree that the disgraceful treatment of P&O Ferries staff, which he outlined, has reminded this House of the importance of employment legislation, that any loopholes must be sealed, and that no one should be able treat decent and hardworking people so contemptuously, with no redress and complete legal impunity? As I say, I commend the hon. Gentleman; he does well and congratulations to him on securing this debate.

[Ian Lavery]

I thank the hon. Gentleman very much for that intervention; I will cover the points he has raised.

To get back to Mr Peter Hebblethwaite: Minister, how on earth is he still in position? I must ask that, as my first and probably most interesting question. A man who agreed that he was breaking the law; a man who said that he would not expect the trade unions to agree with what he was doing; a man who said, despite the fact that he was breaking the law, he would do it again —and he is still in position. Why? That is the question.

The right hon. Member for Uxbridge and South Ruislip (Boris Johnson), the former Prime Minister, claimed from the Dispatch Box on 23 March last year that the Government were taking legal action against P&O Ferries, but they have not done so as yet. So my next question to the Minister must be: why has no action been taken against P&O for how it acted back on 17 March 2022? Parliament must correct that injustice. The purpose of today’s debate is to learn the right lessons from P&O’s breathtaking act of corporate aggression against British workers, and to take the right actions, particularly where they are missing from the Government’s response.

My concern and that of colleagues is that the Government’s responses to date will neither close loopholes nor, crucially, challenge the anti-trade union mindset at the heart of P&O and DP World’s despicable actions. Ex-P&O seafarers and their trade unions—the National Union of Rail, Maritime and Transport Workers, and Nautilus—are increasingly frustrated at the Government’s failure to penalise P&O Ferries, DP World or the flag states involved in this injustice, as early-day motion 954 highlights. As a result, UK seafarers and trade unions across the maritime industry cannot be certain that a similar assault on jobs and employment rights will not happen again.

The first anniversary of the Government’s nine-point plan in response to P&O Ferries is on Thursday. Although the Seafarers’ Wages Act 2023 is welcome, it is unnecessarily narrow and will not come into full legal effect until next year. The Transport Committee has correctly observed that, on its own, the Act

“will not be sufficient to ensure proper treatment of seafarers.”

I ask the Minister: where is the review of the Equality Act 2010 (Work on Ships and Hovercraft) Regulations 2011, which provide limited protection for seafarers from nationality-based pay discrimination? That is what P&O, Irish Ferries and Condor Ferries and other businesses base their model on. That review was supposed to have started by the end of 2020. Minister, when will it start?

For all other employment conditions, including tackling roster patterns of up to 17 weeks on P&O’s fleet, the Government propose a voluntary seafarers charter. The agreement was to base standards in the charter on the collective agreements between the RMT, Nautilus International, Stena Line and DFDS. The charter still has not been agreed, and there are very real concerns among the unions that it is not fit for purpose. Repeated efforts to amend the Seafarers’ Wages Bill to give the charter legal force were defeated by the Government on the grounds that it would effectively mandate collective bargaining. In reality, that is what we need now, and not another review in a year’s time.

As the Transport Committee’s excellent report on the “Maritime 2050” strategy observes of the seafarers’ charter,

“the Government’s current plan to ask operators to sign up voluntarily will not give the assurances and protections that seafarers want and deserve. We therefore call on the Government to make signing up to the charter a mandatory requirement for all UK maritime operators.”

Labour’s prescription of mandatory rights and standards cuts to the heart of the problem. Restoring trade union collective bargaining agreements, safe roster patterns and dislodging the supply of cheap agency labour on flag of convenience vessels is the way forward and will increase seafarer jobs in this country.

I would like to ask the Minister a whole number of questions. Forgive me; I am sure he will not have the time to respond to every one from the Dispatch Box, but I will put them in writing so that we can get a written response. When will the Government make the seafarers’ charter a mandatory requirement for all other operators in the ferry sector? Will the Minister give the trade unions a formal role in assessing the compliance of operators’ policies with the standards in the charter? What assurances can he give that the charter will not undermine existing collectively agreed terms and conditions in the ferry industry? When will the independent research on roster patterns from the Department for Transport report to Ministers?

The P&O scandal affects the 19,000 mainly retired seafarers in the merchant navy ratings pension fund, a multi-employer scheme to which P&O Ferries owes around about £130 million. It is a liability that it is trying to avoid. What are the Government doing to ensure that DP World meets its liabilities to the members of the MNRPF?

P&O Ferries knowingly and unashamedly breached section 188 of the Trade Unions and Labour Relations (Consolidation) Act 1992. It has benefitted from weaknesses elsewhere in the Act, especially in the Government’s interpretations of sections 193, 194 and 285. Section 285 was cited in the Insolvency Service’s decision not to proceed from the evidential test to the public interest test of prosecuting P&O Ferries for criminal offences, because it was said that section 285, in the judgment of the Insolvency Service, provided only an “even chance” of a successful prosecution. Yet there is nothing in the nine-point plan to close the loopholes in the 1992 Act, despite the urgent need to equalise redundancy rights, as a starter, for land-based workers and seafarers.

The protections that P&O breached were introduced in 2018, with the support of the trade unions, with the express intention of strengthening seafarers’ basic employment rights. There were no protections before, which is why P&O Ferries’ decision to breach them must be the start of a fightback against this despotic approach to industrial relations in the ferry industry. Will the Government therefore commit today to strengthening the Trade Union and Labour Relations (Consolidation) Act 1992 by amending section 188 to ensure that it clearly applies to seafarers working regularly from UK ports on international routes, and commit to outlawing ex gratia payments to employees connected with an intentional breach of section 188 of the Act ?

Will the Government amend section 193A(2) to legally require employers to notify the Secretary of State for Transport, regardless of the flag of the vessel, of an intention to make more than 20 seafarers redundant, and amend section 194(3) to ensure that the definition of “body corporate” applies to overseas owners, such as DP World? Will they also amend section 285 to provide these protections against instant dismissal for all seafarers working regularly from a UK port, regardless of nationality or the flag of the vessel? Will the Minister make absolutely sure that the Retained EU Law (Revocation and Reform) Bill does not strike out these minimal protections for seafarers in the 1992 Act?

I return to the shocking decision of the Insolvency Service not to pursue criminal damages and charges against P&O Ferries, effectively letting the company and its chief executive Peter Hebblethwaite off absolutely scot-free. It is essential that we get to the bottom of this chronic regulatory failure, so will the Minister commit to looking at that? Will the Minister commit to reforming the Insolvency Service so that a public interest test informs the evidential tests in cases like P&O where a company director blatantly breaks the law to dismiss directly employed seafarers in collective bargaining agreements, and even say they would do the same again? When do the Government expect the Insolvency Service’s civil investigation of P&O Ferries to conclude? The RMT estimates that UK seafarers hold around only half of the 5,300 ratings jobs on cargo and passenger ferries regularly working on a number of international routes, including Crown dependencies. The union believes we are heading in the wrong direction.

The picture across all sectors of shipping is still worse. The Government’s own impact assessment for the Seafarers’ Wages Act 2023 observed that over the past decade UK-resident seafarers have held, on average, 17% of the total number of ratings jobs across the UK shipping industry. That is a national scandal. This rampant profiteering from exploitative crewing contracts is a fundamental lesson from the P&O scandal, and it has serious safety implications. We need to know what action has been taken to assess seafarer fatigue levels on the P&O Ferries fleet, and what the Maritime and Coastguard Agency is doing to monitor the effectiveness of DP World’s safety incident reporting tool, H-SEAS?

P&O Ferries moved its fleet of six ROPAX—roll-on roll-off passenger—ferries from the UK ship register to the Cyprus register in 2019. The Cyprus register has said nothing on the unlawful sackings, in a clear indication of the effects of deregulated shipping registers on decent employment standards. Will the Minister tell us why the Government have signed an agreement with the Shipping Deputy Ministry of Cyprus to co-operate on shipping matters, including seafarer employment and welfare conditions? The Cyprus register is increasingly popular with ferry operators, which is a real source of concern for those UK seafarers working on Cyprus-registered vessels. Is the Minister promoting the Seafarers’ Wages Act 2023 and the seafarers’ charter as part of this agreement?

It is hard to square that with the ambition in the nine-point plan to grow the UK ship register, unless Ministers intend to further deregulate the red ensign. Earlier this month, DP World reported record profits with £3 billion in dividend payments and £15 million in bonuses to directors, including those at P&O Ferries. It is a scandal that the £11.5 million that P&O Ferries received in furlough payments from the UK taxpayer has not been repaid and that DP World will benefit from lucrative Thames Freeport contracts. I also ask the Minister to investigate urgently the delay in P&O Ferries Ltd submitting accounts for the year to 31 December 2020-21, as my hon. Friend the Member for Sheffield, Heeley (Louise Haigh) raised in a written question.

The future of the UK as a maritime nation, with secure ferry operations supporting full seafarer employment, is at stake here. P&O is introducing new sailings and ferries, and others, such as Cobelfret, are introducing new services that are likely to fall outside the scope of the Seafarers’ Wages Act. How can anyone have faith that the correct lessons will be learned from last year’s scandal while this injustice is allowed to persist?