If there’s one thing that can be said for British ferry company P&O it is that it doesn’t stand on ceremony when it comes to wholesale sackings. In a four-minute recorded video message to its seagoing staff in mid March, its Human Resources Adviser told its 800 workers that their jobs were gone. Not in a week’s time, not even the next day, but as soon as the call was ended.
Meanwhile, as the cameras stopped rolling, security guards with handcuffs were standing by, ready to board the ships moored at Belfast and Liverpool, prepared to evict any workers who might have notions to resist their dismissal. Outside on the docks, cheap replacement workers from eastern Europe sat in mini buses, waiting to take the place of the sacked seamen.
The decision to sack the workers without even consulting the unions had, P&O later admitted, been against the law. But as far as the ferry company was concerned, it was a case of needs must. Having lost £100 million. on its operations last year, it wasn’t prepared to repeat the exercise a second time.
Taking on the east European workers meant having to pay only half the UK minimum wage, cutting wage costs to a mere £5.50 an hour. And P&O could do this because its vessels are flagged in Bermuda, they sail in international waters and as such are not subject to UK wage rate laws.
Naturally enough, the incident provoked outrage in Britain. P&O was roundly denounced for its treachery. The Transport Secretary issued a stern warning that if the decision was not reversed, and if the sacked workers were not re-instated, there would be serious consequences. To which the rogue operator’s reply seems to have been a more or less, ‘Good luck with that’.
But what was not so extensively reported was that P&O had been complaining for months that it was in competition with a ‘low-cost operator’ on the English Channel whose business model was threatening the very existence of P&O.
And that competitor, it turned out, was none other than Irish Ferries, which, in 2005, replaced its 500 crew members with east Europeans, paying them half the Irish minimum wage, and igniting a bitter battle with the trade unions.
Irish Ferries fly the Cypriot – not the Irish – flag, and use Cypriot agencies to hire the workers, thus circumventing the need to pay Irish wage rates.
So P&O, in other words, is now simply protecting its patch by following the example set by its Irish rival so many years ago.
Meanwhile, the UK Transport Department is threatening legislation to force ferry operators to pay British wages if they want to operate out of British ports. It’s a measure that might just prove palatable to the beleaguered P&O if it means a level playing field.
Many commentators on the P&O debacle have drawn a parallel with the infamous closure of Clerys legendary department store in Dublin in 2016. On a June evening, 460 workers assembled at the foot of the iconic main staircase to hear that their jobs were gone. The doors were locked, and they were turned out on the street, too dazed and baffled to grasp what had just happened.
It emerged that the new owners, called Natrium, headed by a property developer, Deirdre Foley, had split the company in two. The property arm was retained; the operating arm, which employed the workers, had been sold overnight to an insolvency practitioner for one pound sterling.
The State was left to pick up the redundancy bill of €2 million.