P&O Ferries says sacking U-turn would cause collapse

The boss of P&O Ferries has hit back at government calls to reinstate the 800 workers it has sacked, insisting a U-turn would cause the firm's collapse.

Peter Hebblethwaite said reversing the cuts, which the firm did not consult unions on, would lead to the loss of an additional 2,200 jobs.

It comes after the transport secretary gave P&O "one final opportunity" to re-employ staff on their previous wages.

He said the company had "painstakingly explored all possible alternatives".

Mr Hebblethwaite said that more than 500 of the sacked crew had accepted and signed settlement agreements, and that he could not change the 31 March deadline for seafarers accepting their redundancy offers.

In a letter in response to Transport Secretary Grant Shapps, Mr Hebblethwaite wrote: "Complying with your requests would deliberately cause the company's collapse, resulting in the irretrievable loss of an additional 2,200 jobs.

"I cannot imagine that you would wish to compel an employer to bring about its downfall, affecting not hundreds but thousands of families."

P&O Ferries' decision to replace the 800 staff it sacked with agency workers earning an average of £5.50 per hour, which is less than the UK minimum wage, has provoked fury from the public, trade unions and politicians.

Prime Minister Boris Johnson and Mr Shapps, as well as unions, called for Mr Hebblethwaite's resignation last week, after he admitted his decision to sack 800 workers without consulting unions first broke the law.

Mr Shapps branded the executive a "pirate of the sea" on Tuesday, accusing him of "disgracefully shredding the reputation" of the company.

However, Mr Hebblethwaite said he would not step down.

He said he felt compelled "to discharge my duties for this historical company" and provide "the effective operation of the trade routes upon which this country depends".

"I will there continue to do my utmost to ensure that this company has a sustainable business for the future."

The P&O Ferries boss also defended the company's new crewing model, saying it was common in the industry.

He gave more detail about the model, explaining that it would use one crew instead of two. This meant staff would be paid for the actual time they worked plus holidays, instead of "granted full pay for working 24 weeks a year".

When it sacked staff, P&O said the move was essential for the firm's survival and that it had made a £100m loss year-on-year, which had been covered by its parent company DP World. The multi-national ports and logistics company is based in Dubai and run by Sultan Ahmed bin Sulayem. It paid a £270m dividend to shareholders in 2020 and runs some of the UK's biggest shipping terminals.

But speaking in front of Holyrood's Net Zero, Energy and Transport Committee on Tuesday, Mr Hebblethwaite said that the company has lost an "unsustainable amount" of money over the last few years, and that it hadn't been competitive for the same amount of time.

He also said that it was not "appropriate" for him or the P&O Ferries board to expect "unconditional support" from parent DP World for the business without a plan to become viable.

Mr Hebblethwaite insisted in the letter published earlier on Tuesday most savings would "arise from the removal of job duplication and the benefits of increased flexibility" - not reducing wages.

The government has urged the company to reconsider and has said it will force ferry operators docking in UK ports to pay the minimum wage.

The need to shift to the new crewing model would not change even if the national minimum wage was applicable, Mr Hebblethwaite said.

"I can further assure you that I am fully cognisant of the reputational cost to the P&O Ferries brand and me personally," he added.

He also reiterated his apology in front of Scottish members of parliament, saying: "On many occasions, I have reiterated how sorry I am for the impact this has had on 800 seafarers… their families, the 2,200 people who remain in the organisation that have had to answer a number of difficult questions.

"I am very, very personally and deeply sorry for that. I do believe, however, that historically we would be talking about the irrecoverable loss of thousands of jobs had we not taken the very difficult decision that we took."