800 P&O sackings had nothing to do with Brexit

British law protects workers but it was EU law which allowed the precedent in 2005

Montage © Facts4EU.Org 2022

Scandal of Irish Ferries in 2005 under EU law was role model for P&O owners

Research by Facts4EU demonstrates that the all too familiar refrain of blaming Brexit for the latest calamity is wildly misplaced. Instead, it is the polar-opposite of the truth. As this report explains, British employment law is tighter than EU law and it was under EU rules that Irish Ferries sacked mariners in 2005 in a very similar manner.

Since that event nothing much changed, but when Irish Ferries opened up routes in competition with P&O and others on the lucrative Dover-Calais route everything changed. P&O had to find a means to reduce its costs to compete – and the EU model provided the answer.

Brexit Facts4EU.Org Summary

P&O sackings are only plain sailing under EU law

The Irish Ferries story

The manner of Irish Ferries announcing its redundancies in 2005 was similar to that of P&O.
The Company’s boss warned ship crews they would be sacked and the company would stop its Irish Sea ferry services if they opposed plans to make 543 of them redundant within two weeks.
“The Irish workers earn about €11 an hour while the eastern European ship workers are paid €3.60. The Irish minimum wage is currently €7.65 an hour.” – Irish Independent 22 Sept 2005.
Eamonn Rothwell, CEO of Irish Ferries’ owners ICG told the Irish Times on 1st October 2005: “The ferry sector has responded by lowering its labour cost base, with 95 per cent of all ships using Irish ports now using outsourced crews, most of which are flying non-EU flags. Some use non-EU crews at even lower costs than EU staffing.”
The dispute was finally settled with Irish Ferries employing agency staff and receiving EU-approved Irish Government state aid for workforce compensation.
The end result was an agency workforce of mostly foreign nationals, far cheaper than that of its rivals, P&O, Stena and DFDS.
When Irish Ferries entered the Dover-Calais route in June 2021, its lower costs allowed it to offer lower fares: “For a family in a car travelling Dover to Calais return in April, P&O was last night offering £175 compared with DFDS’s £172 and Irish Ferries’ £135.” - Sunday Times 19 Mar 2022

Is P&O in breach of UK employment law?

The answer is most likely yes.

The UK Government certainly believes the P&O Ferries' action making 800 employees redundant is in breach of UK employment laws, specifically on collective redundancies. The two pieces of UK law that pertain to such situations are:

The EU’s 1998 Collective Redundancies Directive (ECRD) which the UK gold-plated to make it stronger. For instance the UK law requires a longer consultation period.
The ECRD legislation was carried forward as continuing UK law without any change.
Contrary to the claims of Rejoiners it has NOT been repealed.
The Trade Union & Labour Relations (Consolidations) Act 1992 (‘TULRCA’) is British law which requires that if a company wishes to make over 100 redundancies it has a duty to consult at a minimum of 90 days before the redundancies are contemplated (Section 188).

The question is, with the P&O ships registered in Cyprus, Nassau and Bermuda, do the staff made redundant come under British law, or EU law, or a 3rd country’s law?

Below are some quotes by lawyers who specialise in the field

“Andrea London, a partner in law firm Winckworth Sherwood’s employment team, said Brexit was a “red herring”. She said the EU collective redundancies directive was implemented in the UK by a primary act of parliament which “gold-plated” (went beyond) the EU legislation”.
– from The Guardian, 18 Mar 2022.

Barry Ross, partner and director at Crossland Employment, told Personnel Today: “If the normal UK employment law regime covers the staff of P&O Ferries, then there are significant ramifications for the actions taken in firing 800 staff with immediate effect over a video call.”
“If the normal employment rules applied, P&O Ferries should have consulted the unions for at least 45 days; filed an HR1 (criminal offence not to and individual directors can be criminally liable); and consulted at a formative stage.”

- Personnel Today, 18 Mar 2022.

Finally, another red herring

Many anti-Brexit Rejoiners are alleging that because the UK Government blocked a “Fire and Re-Hire Bill” in 2021 this action could have been avoided. WRONG. It isn't relevant in the P&O case because the company is not firing and re-hiring the staff made redundant.

Observations

EU law all at sea while Brexit sails on

No sooner had the news of the P&O owner’s actions become public than Brexit was being blamed. This is either through ignorance or malign intent, for it cannot be from a knowledge of British employment law.

The Dubai-based owners may have seen an opportunity or have felt forced to act when Irish Ferries decided to enter the Dover-Calais market. What matters is that they have, and P&O have copied their methods to push staff costs down.

Let us be under no illusions. EU law previously allowed Irish Ferries to behave in such a cavalier manner, even allowing Irish state aid to help finance the redundancies without penalty. Somehow we cannot imagine a British ferry company and the UK government having been allowed to do the same had we stayed in the EU.

Thankfully we’ll never know as we voted to leave. What is clear is that UK law is more restrictive and offers better protection to workers. Brexit cannot be blamed – although such facts will not stop some people trying.

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[ Sources: House of Commons Library | Times & Independent newspapers ] Politicians and journalists can contact us for details, as ever.

Brexit Facts4EU.Org, Thurs 24 Mar 2022

With grateful thanks to Scots for Leave (EU) for research assistance

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Reader Comments 11

1. LuxeryBalloon , Thursday, March 24, 2022, 12:54:

And now we are free of the shackles of the EU, the government can act to prevent this from happening in the future. (As we did not seem to have learned from the 2005 Irish Ferries story)

2. Tom Billingham , Thursday, March 24, 2022, 12:56:

The real problem with this is that as remain campaigners realise none of what they claimed would happen has transpired, they will stretch for more desperate claims such as this. They obviously won't admit that their predictions were disastrously wrong

3. William Penn , Thursday, March 24, 2022, 14:06:

It's an odd situation, though devastating for the employees concerned. Despite having taken back control it seems bizarrely unclear when P&O have acted illegally or not. The action clearly demonstrates how P&O, unrestrained by hampering red tape, can use an agile approach to employment contracts to make themselves and global Britain more profitable. Curiously, French employees seem not to have suffered.

4. jon livesey , Thursday, March 24, 2022, 15:15:

1. LuxeryBalloon: Read the story. The boats are not registered inn the UK. They are registered in EU and third countries. What "lesson" are we supposed to learn?

5. LuxeryBalloon , Thursday, March 24, 2022, 19:50:

4. John, we could change the law so that UK employment rules apply to all boats operating in British waters … irrespective to which country the boat is registered?

6. KB , Thursday, March 24, 2022, 22:29:

jon livesey and LuxeryBalloon:
The problem is that P&O would be out-competed by Irish Ferries and any other operators who could employ cheaper staff.
We would have to enforce the famous "Level Playing Field" to ensure all staff were paid at very similar rates irrespective of the nationality of the ship or the staff.

7. KB , Thursday, March 24, 2022, 22:51:

Well done to Facts4EU for looking into the legal aspects. This is actually the best analysis I have read.
A lot of people claim that some of the EU "red tape" and "over regulation" that the right-wing Brexit groups want to get rid of is employment legislation like this. I hope Facts4EU have noted the extreme anger over this affair and can see there is no stomach for diluting UK employment law.
One point though. The P&O staff seem to have "settlement agreements". This is an offer of money (in excess of the contractual redundancy payment) to go away and keep quiet. It's not redundancy and it's not dismissal. You are "voluntarily" accepting a settlement to go away. It's not clear that it has to be informed to the secretary of state as a redundancy. In fact they are generally highly secret, with the lucky recipients not even allowed to say any settlement agreement exists, never mind anything else. This route is increasingly being used by big business instead of redundancy. However, if the employee refuses to sign it, they are meant to go onto the redundancy route not be dismissed straight away. Anyhow, if they have settlement agreements it seems to me no law has been broken yet.

8. jon livesey , Friday, March 25, 2022, 00:03:

5. LuxeryBalloon: First read KB's post, because he has a good economic point. On your point, yes, there are many things we could do, and the best of it is that post-Brexit, when you lobby your local MP, he will actually have to reply to you explaining what and when, and not just be able to slough it off on the EU. Isn't that cool? And if you don't like the reply, you can vote them out. That's cool, too.

9. Observer , Friday, March 25, 2022, 09:35:

It's more than just curious coincidence that when Boomers opine about Brexit, there are no negative outcomes. Just as curious is the distinct absence of "sunlit uplands".
I am aware of the gentlemanly delight of seeing a crown printed on my pint glass, in which, for no less than five pound, I can be served a full pint, not 500ml. Never mind that some of it spilled into a drip tray because it's hard to get bar staff I'm told. It's the principle.
In anticipation of cries of "UnELeCteD ELITES! " - we have quite a few of those already.
Next up; "SoVeReIgNtY!!"; we're either choosing to or failing to check goods passing through our own borders that we fully control.
Next one is a popular one, "IMmIgRaTiOn!!!" - I think we all know that, at best, other immigrants have replaced EU ones.
A casual observer might conclude that all we've done is gone round in circles, an astute one will probably conclude than we have gone backwards, in circles.

10. LuxeryBalloon , Friday, March 25, 2022, 10:30:

Dear John and KB. Brexit offers significant opportunities to make the UK more agile and competitive on the global stage. Theresa May too saw only obstacles and regarded Brexit as a damage-limitation exercise … we need to learn from the past when the EU shackles impeded us, and remove these barriers … and stop continuously comparing what we want to do to what the EU is up to. The P&O debacle is a good example where we can apply our new found freedoms to improve regulations in the UK.

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