Transport Secretary Grant Shapps has called for the boss of P&O Ferries to resign after his “brazen” comments about “knowingly breaking the law” and vowed to force the company to “U-turn” and pay its crews the minimum wage.
It comes after chief executive Peter Hebblethwaite admitted the ferry giant broke employment law when it sacked 800 workers without notice.
The Transport Secretary told Sky News on Friday: “I thought what the boss of P&O said yesterday about knowingly breaking the law was brazen and breathtaking, and showed incredible arrogance.
“I cannot believe that he can stay in that role having admitted to deliberately go out and use a loophole – well, break the law, but also use a loophole.”
Pressed on whether that meant he was calling for Mr Hebblethwaite to resign “right now”, he said: “Yes.”
On Thursday, Mr Hebblethwaite was urged by MPs to quit after acknowledging there is “absolutely no doubt” the ferry operator was required to consult with trade unions.
The company replaced its crews with cheaper agency workers last week.
The chief executive admitted that the new crews are being paid below the UK’s minimum wage apart from on domestic routes, but insisted this is allowed under international maritime rules.
Mr Hebblethwaite, whose basic annual salary is £325,000, revealed that the average hourly pay of the new crew is only £5.50.
The minimum wage in the UK for people aged 23 and above is £8.91 per hour.
Mr Shapps said the Government is planning to change the law to ensure companies working from British ports pay people the minimum wage, as he condemned P&O for “evilly exploit(ing)” loopholes.
He said the move from the Government would force a “U-turn on what’s happened at P&O”.
“What I’m going to do … is come to Parliament this coming week with a package of measures which will both close every possible loophole that exists and force them to U-turn on this,” he said.
“We are not having people working from British ports … plying regular routes between here and France or here and Holland, or (anywhere) else, and failing to pay the minimum wage. It’s simply unacceptable and we will force that to change.”
The minister told BBC Breakfast that maritime law was “very, very complex” but that he was preparing a package of “about eight” different measures to bring to Parliament, where he believed there was “very, very broad parliamentary agreement” that new legislation was needed.
“P&O will need to re-employ people on the proper salaries,” he said, confirming this would mean national minimum wage.
Mr Shapps said the Government “can’t directly” revoke P&O’s licence when asked why the company was still operating after having broken the law.
He said he had instead asked the Maritime Coastguard Agency to carry out “very detailed inspections”.
The minister said if new crews were being paid under national minimum wage and found to be unfamiliar with equipment, the ships would be deemed unsafe to sail.
Mr Shapps also said P&O Ferries had “attempted to pay off their staff with higher redundancy payments … and therefore buy their silence”.
Asked how Government plans to change the law would help sacked seafarers, the Transport Secretary said: “I actually happen to know because I’ve been speaking with some of them that some of them have already taken up a job, so they may not get those particular ones back.
“I suspect they’ll get some of them back, although I imagine they’ll have a slightly rather jaded view of their employer as P&O”.
Mr Hebblethwaite on Thursday told a joint session of the Commons’ transport and business select committees that Mr Shapps knew about the intention to cut jobs in November last year, although that was strongly denied by the Department for Transport.
Asked about the claim, Mr Shapps said it was a way to “distract attention” from its failure to provide notice of job cuts.
The Transport Secretary also said he he “didn’t see” an email sent round Whitehall about P&O’s plans the night before the mass sackings and was told “at the despatch box”.
Asked who the email would have been sent to if not the transport secretary, he said: “Well, I think it was sent to a very small group of officials in order to record a conversation, the notes of a conversation that happened.”
Mr Shapps added: “Frankly, even if I had known the night before, which I didn’t, they’d already broken the law by not providing 45 days’ notice, by using the Cyprus flag to get around it.”
The Rail, Maritime and Transport union said it will be meeting with P&O Ferries on Friday to demand the reinstatement of the sacked seafarers.
TUC general secretary Frances O’Grady said it was a “watershed moment” for the UK shipping industry and workers’ rights.
“(P&O’s) owner must be given pariah status and lose all its Government shipping and freeport contracts with immediate effect until workers are reinstated.”
