The billionaires behind troubled ferry giant P&O received £270million in dividends in the same year it claimed £10million in tax payer cash to pay staff on furlough.
The company came under huge scrutiny on Thursday after suspending all ships and ordering crew and passengers off ferries at ports across the UK as 800 employees were fired on a zoom call.
Ministers branded the ferry operator 'disgusting' and 'appalling' in the wake of the announcement, as it emerged cheaper agency staff will replace their roles in a huge cost-cutting drive amid a worsening cost of living crisis.
The ferry operator, was bought by Dubai-based logistics giant DP World in 2019. Its chief executive is Sultan Ahmed bin Sulayem - whose firm reported a £683million profit last year and soaring revenues.
The firm, which carried 10million passengers a year before the pandemic, has now cancelled sailings 'for the next few days'.
It insisted the decision to cut jobs was 'very difficult but necessary' as it was 'not a viable business' in its current state.
The company, which told staff it lost £200million in the last two years, is now facing calls to reimburse the £10million it received in furlough cash back to the Government amid widespread condemnation of how the redundancies were delivered.
DP World was criticised for paying a £270million dividend to shareholders at the end of April 2020 while P&O Ferries cut around 1,100 jobs as travelled collapsed following the pandemic.
Karl Turner, MP for East Hull, said P&O Ferries had received £10million from the Government for furloughing 1,100 members of staff during the coronavirus pandemic, and demanded the British taxpayer was reimbursed.
Speaking to LBC, he said: “All of that money - that £10million for furlough in the pandemic - should be clawed back.
“Any money that the British taxpayer provided to that business should be taken back from them and the Government should be saying to the company 'get round the table with the unions and negotiate some sort of deal'.
“We cannot have a situation like this whereby businesses can behave like this with British workers.”
Hundreds of seafarers in Dover, Hull and Northern Ireland are now protesting against the decision.
On Thursday, some refused to disembark shifts, prompting 'security in balaclavas' to escort them off the promises.
Unions have since threatened legal action and lawyers since suggested workers could bring unfair dismissal claims.
Martin Williams, head of employment at Mayo Wynne Baxter said: “I fully expect P&O Ferries, and their ultimate owner, will have ‘priced-in’ the probability of legal challenges and the possibility of settling them.
“This is part of the cold calculation they will have made which was manifest in the pre-recorded announcement to workers. The livelihood of the workers is seen simply as collateral damage when making such a move.
“The Government has been taken by surprise and will have noticed the public backlash,” he said.
A letter addressed to transport secretary Grant Shapps and signed by Mr Turner and his fellow Hull MPs Emma Hardy and Dame Diana Johnson yesterday, said: “This shocking move has been made without warning, notice or consultation in a deliberate attempt to undercut the wages and conditions of British seafarers.
“This is despite P&O Ferries' owners, Dubai-based DP World, having received millions of pounds in taxpayer support during the pandemic who [...] received over £10million through the furlough scheme, and requested a £150m bailout from Government, despite DP World paying out £250million to shareholders.
“We cannot allow a dangerous precedent to be set, all the more so on transport routes which are strategically vital to the UK.”
The Prime Minister's official spokesman said maritime minister Robert Courts had also raised the issue with the company's chief executive.
“The way these workers were informed was completely unacceptable,” A Downing Street spokesman said.
“Clearly the way that this was communicated to staff was not right and we have made that clear.
“Our sympathies are with these hard-working employees affected during this challenging time who have given years of service to P&O.”
P&O Ferries told staff members: “As you may be aware the business has been struggling financially for the last few years and has lost around £100million each year for the last two years.
“Whilst these losses have been covered by P&O Ferries' parent company, DP World, it's clearly not sustainable in the future.
“Therefore I'm sorry to inform you that this means your employment is terminated with immediate effect on the grounds of redundancy. Your final day of employment is today.
“P&O is offering you an enhance severance package which is well beyond the statutory requirements and the redundancy terms within your collective bargaining agreement.
“Details of this package are in a document pack which you will receive by email today so I urge you to keep an eye on your emails for receipt of the document.
“The enhanced severance payment will be made to you in April this year subject to you signing a settlement agreement by the 31st of March and complying in full with its terms and conditions.”
It has since been alleged that workers have been told their redundancy pay could be at risk if they speak out on the cuts.
Labour MP Dame Diana Johnson said the people of Hull 'stand tonight united in our utter disgust' at the actions of P&O Ferries, adding: "This is a choice between predatory employers sacking workers on Zoom in their levelling down race to the bottom or our loyal hard-working UK workers fighting for their jobs."
P&O Ferries said it had handed 800 staff severance notices, adding that it was losing £100million year-on-year and its survival was 'dependent on making swift and significant changes'.
Union bosses slammed the firm and said it was 'a scandal' that British workers had been betrayed when UK taxpayers were made to foot the bill for the company's costs during the pandemic.
Rail, Maritime and Transport union (RMT) general secretary Mick Lynch said: "We are seeking urgent legal action and are again calling for the Government to take action to stop what is fast turning into one of the most shameful acts in the history of British industrial relations."
Meanwhile, Nicola Sturgeon has told the boss of P&O Ferries of her 'utter disgust' at the treatment of seafarers who have been sacked and replaced with cheaper agency workers.
Just hours after the company announced the move, the Scottish First Minister said she had spoken with its chief executive and had 'made clear my utter disgust at this appalling treatment of its workers'.
She said on Twitter : "I made clear that @scotgov stands with these workers and will do everything possible to ensure fair treatment for them."
P&O Ferries, which transports passengers and freight, operates four routes: Dover to Calais; Hull to Rotterdam; Liverpool to Dublin; and Cairnryan, Scotland, to Larne, Northern Ireland.
The company is run by one of the world's largest logistics firms that is itself owned by the controversial ruling family of Dubai.
Since 2006, the ferry operator has been controlled by either DP World or previously its parent business Dubai World.
DP World's chairman is Sultan Ahmed bin Sulayem, an Emirati businessman who's father was an advisor to the Maktoum family, currently headed by UAE Prime Minister Sheikh Mohammed bin Rashid Al Maktoum.
Sheikh Mohammed is also the majority stakeholder in Dubai World, the current parent company of DP World.
The firm manages 70million shipping containers a year and reported a £683million profit last year.
Despite this, at the start of the pandemic P&O Ferries were reportedly among the firms to apply for a £150million government bailout to mitigate the reported £257million impact of coronavirus on its trade.
Speaking to the BBC at the time, CEO Sulayem criticised the government's response as 'slow' while adding that P&O Ferries had furloughed 1,400 workers.
His request for the money came as DP World shareholders were expecting a dividend of £270million.
TUC general secretary Frances O'Grady said: "No one should be laid off with zero notice and no consultation, let alone a whole workforce. P&O Ferries' secret plan to sack their workers is reprehensible and unlawful.
"When an employer lays off more than 100 staff at once they must consult workers and unions in advance and they are required to notify the Secretary of State in writing in advance too. The Government must urgently explain what they knew and when.
"If P&O Ferries breached the law they must suffer severe consequences, with ministers increasing the legal penalties if necessary. If one employer gets away with this, every worker is at risk."
Maritime union Nautilus International's general secretary Mark Dickinson added: "The news that P&O Ferries is sacking crew across its entire UK fleet is a betrayal of British workers.
"It is nothing short of scandalous given that this Dubai-owned company received millions of pounds of British taxpayer's money during the pandemic."
The redundancies come at a critical time for households, with a cost of living crisis fuelled by rising inflation that yesterday saw the Bank of England raise interest rates to 0.75%
The latest inflation figures are due out next Wednesday, when the scale of the crisis will be laid bare in the Chancellor's Spring Statement.
