The UK government has announced plans to block ferries with crews paid less than the minimum wage from British ports in response to widespread fury to P&O Ferries’ sacking of 800 workers without consultation.
The transport minister, Grant Shapps, told parliament on Wednesday that the government would write to the operators of British ports telling them to refuse access to companies that did not pay the UK minimum rate, adding: “This will have the full backing of the government .”
He also outlined plans to create “minimum wage corridors” on ferry routes between the UK and other countries.
P&O Ferries drew an outpouring of criticism and calls for action after its chief executive, Peter Hebblethwaite, acknowledged in extraordinary testimony to a parliamentary committee that the company had deliberately ignored employment law which requires companies to consult staff before making redundancies. It intends to hire cheaper workers that would not be subject to UK minimum wage laws.
Hebblethwaite, whose basic annual salary is £325,000, told MPs last week that the average pay of the agency crew is £5.50 an hour. The minimum wage in the UK for people aged 23 and over is £8.91 an hour.
Shapps has written to the Insolvency Service, the agency responsible for regulating company directors, saying he believed Hebblethwaite’s actions amounted to “sharp practices” that should disqualify him from leading a British company.
The government will seek to bring in primary legislation to amend the Harbors Act of 1965 to include the minimum wage provision.
However, it is obliged to consult the public before making changes, so the government will seek to use the voluntary block to make sure “P&O Ferries can derive no benefit from the action they have cynically taken”, Shapps said.
The government is also considering changes to employment law to target “fire and rehire”, a deeply controversial practice used by big companies to cut wage bills. Shapps said the government would look at allowing courts or employment tribunals to take into account the manner of a dismissal, and give them the power to award 25% more in employment settlements.
The changes – some of which have been demanded by opposition politicians and unions for years – come amid criticism aimed at the government over its inability to respond to the sackings.
Shapps said ministers had instructed HM Revenue and Customs to inspect P&O Ferries’ tax affairs closely to ensure it was meeting minimum wage requirements.
The Maritime and Coastguard Agency, a government body, has also detained two P&O Ferries ships, the European Causeway in Larne, Northern Ireland, and the Pride of Kent in Dover. P&O complained that the agency was exercising “an unprecedented level of rigour” in the safety inspections it was undertaking, according to the Press Association.
George is Digismak’s reported cum editor with 13 years of experience in Journalism