21st March 2022

P&O redundancies: Sharp practice or illegal under employment law?


Sacked by video and seen off by balaclava-ed security men

The practices of the shipping industry have a reputation for being opaque. It is not uncommon for a vessel to be owned by a shipping business domiciled in Greece, registered in and flying the flag of Panama, and being operated by a crew from a low cost labour economy such as the Philippines. And the scrapping of some vessels that are no longer seaworthy, in crude and inappropriate conditions that carry environmental as well as health and safety risks, in countries such as India leave a lot to be desired.

There has been widespread outrage and condemnation over the actions of P&O Ferries in making mass redundancies of 800 employees on 17 March 2022. The methods used to inform the affected workers and then remove them from the vessels while on shift saw them sacked via a video recording and then escorted off by balaclava-ed security men.

The role of specialist maritime recruitment agencies have been repeatedly mentioned in the unfolding story. The two recruitment businesses, one based in Glasgow with offices in Poland and Latvia, and the other in Cyprus, have been reported as supplying agency workers to replace the permanently employed crew members.

Action to save the business and 2200 other jobs – but is it legal?

The background is that P&O Ferries, which is owned by Dubai-based DP World, has sustained year-on-year losses of £100 million and was forced to act to save the business and the jobs of 2,200 other employees. In the aftermath, sailings are suspended for 10 days and the travel itineraries of passengers and lorry drivers booked with the company are now in disarray.

With the smooth flow of goods in and out of the UK bound up in red tape and extra costs since Brexit, supply chains are already affected. P&O Ferries’ operations are responsible for the transit of 15 percent of all freight into the UK, as well as a third of all freight in and out of France. This is likely to increase inflationary pressure yet further due to shortages of some foodstuffs.

According to one minister, the government is powerless to stop P&O’s sackings, and it may seem like sharp practice. However, the opinion of legal experts is that the actions taken to effect the redundancies contravene UK employment laws.

Many leading companies see a cultural commitment to high standards of welfare and working conditions for employees as a cornerstone of successful operations. The actions of P&O Ferries may be one way to operate a business and treat staff, however for many, it may not seem like a very good look.

Sea transportation carries a significant risk and customer trust in the highest safety standards is an absolute necessity. The safety of vessels with ‘fired and rehired’ agency sourced crews have been called into question by some, as they may lack the experience required to navigate the English Channel, the world’s busiest sea route.

The shipping industry tends to be a tight-knit community, but there is no suggestion that the specialist maritime recruitment agencies involved knew the redundancies might be controversial. However, the adverse publicity and reputational damage that results from such high profile events is unwelcome for any recruiter. In short, the takeaway for recruitment agencies is that any association with the breaking of employment law should be avoided at all costs.

Agile support for employment law compliance with ETZ

ETZ’s back office software is RecTech designed from the ground up to help recruitment businesses to achieve compliance with employment laws. For financial compliance, ETZ’s market leading timesheet, invoicing and payment solution transform efficiency of back office processing, while ensuring compliant payment and tax calculation and reporting.

ETZ Comply is the onboarding solution that lets recruitment agencies accelerate onboarding and more easily manage the compliance requirements relating to employment law. You can easily identify gaps in documentation, or see when documents are set to expire. Capture candidate documents such as passports, working visas and driving licenses, and automatically sign candidate contracts.

To find out more, call us on +61 (0) 405 458 821 or book a demo.

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