The firm’s boss admitted that the P&O Ferry violated the law by deciding to lay off 800 workers without consulting “no union could accept our offer”.
Peter Hablethwaite said at a Commons hearing on Thursday about last week’s dismissal that the firm was halving its costs under a “new operating model” that would mean international seafarers would be paid less than the minimum wage.
New questions have also been raised about the ministers’ warnings about the dismissal after Heblathwaite told P&O’s parent company, DP World, the transport secretary, Grant Shaps, about the planned changes to its business model in November.
Heblathwaite faced an intense test at a joint hearing of the Transportation and Business Committee. The chairman of the business committee, Darren Jones, opened up about the recent rise to the position of chief executive of Heblathwaite at P&O: “Are you in this mess because you don’t know what you’re doing, or are you just a shameless criminal?”
Heblathwaite apologized but said the company “had no future otherwise”.
He later admitted: “There is no doubt that we need to consult with the unions. We decided not to do it. “
Andy MacDonald MP intervened: “Did you choose to break the law?”
Habelthwaite says: “We chose not to consult … and we will fully compensate everyone for it.”
McDonald’s says: “You cannot exclude yourself from the UK legal framework.”
Heblethwaite replied: “It was our assessment that the change was so great that no union could accept our proposals.”
The P&O boss said the sailor who was fired under a previous Jersey deal was paid £ 36,000 per year.
Replacement crews will receive an hourly rate starting at 5.15 excluding the Learn-Cairnarian route between Northern Ireland and Scotland, where it will be bound by UK minimum wage law.
He told MPs he was “saving business”, adding: “I will make this decision again, I am afraid.”
Heblethwaite said he was paid £ 325,000, including two performance-related bonuses, although he said he “did not know” whether he would receive the bonus this year. He did not answer questions when asked if he would be able to maintain his lifestyle at the rate of £ 5.15 per hour, given to the new crew.
McDonald asked: “How do you expect them to be able to feed their families and pay their bills? It is not understandable that you have broken the law as a business decision.”
Heblathwaite acknowledged that people were canceling their trips, especially on the Dover-Calais route: “There must be some people.”
He added: “There is no question that the brand has hit. But we now have a competitive, modern business. We have a future now. We don’t have to close our business. I’m sorry to hear that. “
Incredible MPs asked Heblathwaite to confirm his earlier testimony. Gavin Newlands asked: “Which employment law provisions have you violated?”
Habelthwaite said: “We did not consult, and we are fully compensating people for this.”
Jones later asked: “You told this committee you deliberately broke the law …”
Habelthwaite responded: “I totally hold our hand that we chose not to consult.”
Hebblethwaite lawmakers said Shapps was informed on November 22 by P&O Ferry’s parent company, Dubai-owned DP World, that it would change its business model.
Appearing after the hearing, Robert Courts, Minister of Maritime Affairs, said: “Business challenges were discussed, but not more.” He said he would send a copy of the minutes of the meeting with Shaps to the committee.
Asked if the government wanted to prosecute the P&O ferries, Business Minister Paul Scully said they were still awaiting directions from the Insolvency Service and were investigating whether the company had broken the law. But, he added: “You absolutely heard that he has.”
Regarding employment laws, he said: “We have heard that they have deliberately, intentionally broken the law. It will be to address the workers and their representatives. “
The chairman of the transport committee, Hugh Merriman, closed the hearing by describing the evidence as “a story of corporate fraud where a large company thinks it could break the law with impunity”, hoping the government would seek speedy legal redress against the P&O ferry. And legislate to tighten the law.
The unions have called on the government to immediately impose sanctions to stop shipping and reinstate the sacked crew. RMT General Secretary Mick Lynch said: “This should involve the government controlling the ship if necessary. We also call for the immediate disqualification of Peter Heblathwaite as director because he has admitted he has violated company law and will do so again.”
Lynch said at the hearing how the dismissed workers were paid to receive pay-offs to date, on the basis of non-disclosure and on the basis of an agreement to forfeit any further legal action.
Legal experts also told the committee that P&O should have notified the flag states of their ships in Cyprus, Bermuda and Bahamas 30 to 45 days in advance – not in a day.
After the hearing, Liberal Democrats said Schapps had “serious questions to answer” about what he knew and when he planned to shamefully dismiss P&O workers.
Transportation spokeswoman Sarah Olney said: “It increasingly appears that Grant Shaps was asleep at the wheel, and missed important opportunities to intervene and save lives.”
A spokesman for the Department of Transportation said DP had not told World Shapes about “any changes made to the P&O ferry” or any indication that “subsequent changes are completely unacceptable.”