Recently, we saw the CEO of P&O Ferries make 800 members of staff redundant effective immediately.
Under English law, employers planning to make 100 or more employees redundant within a 90-day period, must consult with the appropriate employee representative(s) at least 45 days before the first dismissal takes effect and notify the secretary of state at least 45 days before that first dismissal. A tribunal may award up to 90 days’ gross pay in respect of each employee where there has been a breach of the inform and consultation duty and can additionally fine an employer if it fails to notify the Secretary of State.
Last week , P&O boss Peter Hebblewaite, admitted to MPs the decision to sack 800 workers without consulting their unions broke the law. As a result, P&O will need to pull together a compensation package of £36.5m, with 40 employees getting more than £100,000 and no employee being paid less than £15,000. Whilst it cannot be disputed this is a lot of money, this is substantially less than their suggested losses of £100m.
What remains unclear, however, is whether P&O have breached their duty to notify the secretary of state. P&O suggests they did not need to notify the UK government due The Trade Union and Labour Relations (Consolidation) Act 1992 which was amended by statutory instrument in February 2018. P&O has stated, in line with this amendment, that they notified ‘the competent authority of the state where the vessel is registered’ (Bermuda, Bahamas, Cyprus) on 17 March 2022.
Aside from the obvious direct financial impact, a sudden decision like this will bring a heap of reputational implications. Transport secretary, Grant Sharps, has already called for Peter Hebblewaite to step down. It will be interesting to see the further indirect implications on P&O Ferries and if they will be able to survive the reputational damage they have put upon themselves