The Government said on Friday it was looking at whether P&O may have broken the law when it laid off 800 staff without warning.
The Prime Minister’s spokesman said the Government was looking into the detail of what happened before deciding what steps it might then take. Transport Secretary Grant Shapps said earlier that he had ordered a review on any contracts between the Government and P&O and its owners DP World.
“At this stage it is too early to be definitive,” the PM’s spokesman said. “There are a number of rules…we expect companies to treat employees fairly, it’s only in extreme circumstances that employers need to make extreme decision to secure the future of their business if all other avenues have failed including negotiations between employer and employee. We don’t believe that is the case for P&O staff but we are looking into this very carefully.”
Number 10 added that there were rules requiring companies to notify the Government when making large scale redundancies and around the use of “fire and rehire” practices by firms.
He added: “We take this issue extremely seriously and we are looking very closely at the action this company has taken to see if they acted within the rules. Once we have concluded that we will decide what the ramifications are.”
He said there were lots of “valid questions” about existing contracts between the Government and P&O and its owners DP World, and added: “We are working through exactly the detail of what action this company took and once we have come to that conclusion, we will set out any further steps.”
Asked about the contracts the Government had with the ferry operator and its parent company, the spokesman said he didn’t have a full list but confirmed “there are contracts we have but I don’t have the full list of what they are.”
Officials at the Department for Transport were told in strict confidence about the company’s decision to sack the staff on Wednesday evening – the day before P&O delivered the news to staff by Zoom.
Mr Shapps on Friday launched an excoriating attack on the ferry operator for sacking 800 staff without warning as he ordered the contracts review
In a speech to the Conservative Party’s spring conference in Blackpool, Mr Shapps described the company’s behaviour as “insensitive and brutal”.
“Management at P&O Ferries, the most illustrious initials in British shipping, have given them a new meaning: ‘p....off,’” he said.
The move by P&O, owned by Dubai-based logistics giant DP World, to sack the sailors and replace them with cheaper staff has sparked outrage with services set to be hit and protests planned for today at ports across the country.
Labour said it had on Friday written to Boris Johnson demanding the Government suspends DP World’s licences and contracts in the UK and claws back £10 million paid to the company during the Covid pandemic to support staff put on furlough.
The defence minister James Heappey, who branded P&O’s conduct “grubby”, said it would be “the right thing to do” for the ferry operator to hand back the cash.
“It certainly feels to me that it would be the right thing to do for P&O to hand that money back and I am sure that colleagues at the Treasury and Department for Transport will be looking into it. It’s absolutely disgraceful behaviour by P&O,” he said.
However, Government officials made it clear firms could claim furlough as long as the cash was paid on to staff.
The Treasury said: “Furlough provided a lifeline to more than a million businesses across the UK and protected nearly 12 million jobs — with businesses passing all the money they received from the scheme on to employees. Any fraudulent claims made by businesses will be investigated by the HMRC’s Taxpayer Protection Taskforce.”
It is not clear what contracts, if any, P&O’s parent company DP World has with the Government.
Mr Heappey acknowledged that there may be little ministers can do now that the firm had taken the decision to lay off the staff. He told Sky News: “Sadly it’s the case that the Government cannot force an employer to continue to employ people it has said it doesn’t want to continue to employ.”
He said the Government was “seeing what they can do to make the situation better” but added: “The reality is that P&O have made a commercial decision and as much as we disagree with it, I fear for those workers they have been badly let down.”
P&O said it took the decision — delivered via a Zoom video call — after it suffered losses of £100 million following the travel slump caused by the pandemic. The firm said early today it would not be able to operate services “for the next few days” from Dover to Calais, Hull to Rotterdam, Liverpool to Dublin, and Cairnryan to Larne.
It advised those already at Dover and Calais to make their way to the check-in booths for Danish firm DFDS, but there were no such instructions for those at Hull, Rotterdam, Liverpool, Dublin, Cairnryan or Larne.
Labour’s shadow transport secretary Louise Haigh described the decision as “a despicable assault on workers’ rights” and added that the Government “must consider suspending licences and contracts held with DP World, claw back every penny of taxpayers money”. She added that ministers must also consider legislation to outlaw “fire and rehire” practices where companies lay off staff to replace them with cheaper labour.
