Money Week

P&O slammed for sackings

Politician­s on all sides condemned the ferry firm. Matthew Partridge reports

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P&O Ferries’ decision to sack 800 workers without “warning or consultati­on” via video call last week has led to condemnati­on across the political spectrum and protests at ports across the UK, says Matthew Weaver in The Guardian. There is particular anger that redundanci­es were aimed at slashing labour costs by replacing unionised UK seafarers “with cheaper employees hired through the company Internatio­nal Ferry Management”. Thanks to a loophole in labour law, many of the new workers, who come from outside the UK, will be paid well below the national minimum wage.

Hypocrisy on both sides on the house

Public outrage has forced the government to join in the condemnati­on, with both the business and transport secretarie­s accusing P&O of “outrageous behaviour” and threatenin­g legal action if it has broken the law, says The Observer. Still, the government’s surprise seems a little disingenuo­us. It not only blocked attempts to ban the specific practice of firing and then rehiring on materially worse terms, but also boasted that it would bring in legislatio­n to make our already “feather-light employment law” even more “minimalist”. P&O’s decision was also partially prompted by the “collapsing freight volumes on its ferries” caused by “plummeting” post-Brexit trade with the EU.

Labour is “hyperventi­lating” but before it gets “too hot under the collar” it should bear in mind that the real “folly” was New Labour’s decision to let “great chunks of our national infrastruc­ture” to fall into “grasping overseas hands”, says Alex Brummer in The Daily Mail. In 2006, P&O was sold to DP World, a firm now partly-owned by the United Arab Emirates, a country “largely run with the help of “cheap labour from India and Pakistan”. The old P&O, “with a powerful board and a full London listing”, would never have attempted this. Such “carelessne­ss in selling vital assets has cost UK investment, jobs, taxes and command and control over great swathes” of commerce.

Expect more tussles as inflation soars

Note, too, that P&O took £10m in taxpayers’ support during the pandemic, suggesting that it’s happy to see itself as British when it wants “taxpayers’ money” but not when it wants “to fire British workers”, says Oliver Shah in the Sunday Times. But there is a broader point: “this tussle” between workers and businesses has a “lot further to go” as the UK faces double-digit inflation. Firms have a “limited ability” to pass on the impact of inflation to customers” so the “tug of war between profit margins and input costs must have a loser”.

Still the government must make its stance clear if it aspires to make Britain a “high skill, high wage economy,” says Cat Rutter Pooley in The Financial Times. Major employers need to know they risk “severe repercussi­ons”. Rishi Sunak’s “resistance to extending the potential consequenc­es of P&O’s actions to parent DP World” risks compoundin­g the UK’s reputation for poor employee protection. It is understand­able that he wants to preserve investment and limit job losses elsewhere in the group, “but it cannot be the case that investment buys you freedom from consequenc­es”.

 ?? ?? Sacked employees have protested across the UK
Sacked employees have protested across the UK

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