18/03/2022
P&O Sackings Disgrace
Like many, I was appalled to hear the news about 800 P&O employees being dismissed without notice and being told by video link that their employment was ending immediately by reason of redundancy. The day after, the newspaper headlines reflect the upset amongst workers and unions, and the talk during radio interviews today has been of the commencement of legal action. Government and opposition MPs have expressed disgust about how the workers have been treated, but in reality it is a further incident which confirms how little can be done when this type of extreme situation arises.
The first question for me is whether or not this is truly a redundancy situation. P&O have been open in stating that they want the staffing of ferries to be undertaken by third party providers. A straightforward reading of that could envisage the possibility of this being a TUPE transfer situation, with the transfer of responsibility to a third party business being a type of service provision change. When dealing with a global employer, it is more difficult to prescribe how a transfer may occur, but the business has been open in stating that from this point they would be engaging agency labour, no doubt having preferred providers, possibly on a sole basis or in different jurisdictions.
When agency workers are engaged, they will no doubt have a lower hourly rate than the directly employed workforce, but I am suspicious of the true saving in this situation, because often the engagement of agency workers can be at least as expensive, noting that P&O will be required to pay a worker premium or fee for each person engaged. No doubt P&O will also welcome the opportunity to balance labour requirements against seasonal variation in demand, but as a long established shipping business, surely that is already factored into how employees are engaged on either a permanent or temporary basis. I hope that those representing the P & O trade unions will study carefully the arrangements devised between P&O and agencies to see if a TUPE analysis is viable. It is not the type of work which can be done on the basis of a 2 minute telephone call to ask a person to come into work, the agency workers will need to be trained and to comply with specific health and safety standards, mainly for the benefit of the travelling public. Specific agencies will be engaged as a pool of trained dedicated labour will be allocated to the P&O contract.
The talk of legal action engages a number of principles, including whether this is a redundancy situation at all, bearing in mind that there is no suggestion that P&O need less workers to perform jobs of a particular kind. My reading of the situation is that the company needs to save money, and the procedure adopted by P&O would be likely to be found by an Employment Tribunal to engage mass unfair dismissals. I will return below to the issue of possible remedies.
When an employer is proposing to dismiss as redundant (and this can include restructuring) a large number of workers (usually exceeding 20), there is a legal obligation to consult with recognised trade unions (or in the absence of recognition, other representatives/workers), and in this scenario the obligation will be for consultation to be for at least 45 days. The purpose of consultation is to seek agreement about avoiding the dismissals completely, reducing the number of dismissals, and mitigating the impact of the dismissals. If P&O genuinely needed to save money and to make other practical changes, the whole point of the consultation legislation is to require the business to seek to agree that with the existing workforce through their trade unions. This case has shown once again that domestic UK law has no teeth when dealing with this kind of employer, because the remedy for complete failure to comply with this legal obligation is simply a matter of compensation. In other jurisdictions, including within the EU, it is possible for trade unions and individual workers to seek a form of injunction to prevent the employer from failing to comply with their legal obligations, so that the dismissals cannot be implemented. Certain jurisdictions require a court order prior to giving notice of dismissal. Those speaking yesterday in Parliament may express unhappiness about how P&O has behaved, but the answer would be to provide comparable practical remedies in the UK to prevent the dismissals in the first place. It goes without saying that the obligation to provide notice of dismissal to an individual has also been ignored by P&O, so that what appears to be a clear entitlement to receive 12 weeks of notice for those with long service is in truth a worthless entitlement reflected only in payment of compensation.
During the recorded video call P&O confirmed that they would be paying workers a redundancy package well above the statutory level, and above a scheme already agreed between the company and trade unions by way of a collective agreement. At this stage I do not know whether individuals will be required to sign Settlement Agreements to receive the payments, but in making payments at a much higher level than technically required, the company knows that they will get credit for this from a court or Tribunal assessing compensation, and I have no doubt that workers will receive full payment of notice pay, payment of state redundancy pay, payment for accrued holidays, and a substantial enhancement taking advantage of the ability to pay up to £30,000.00 tax free. Payments may even include the 90 days of pay which is the protective award remedy for the failure to consult about redundancies with the trade union. This will impact upon whether there will ever be any additional remedy available for workers in relation to what appear to be good legal claims.
This case illustrates the failure in UK employment law which reduces any action of an employer to a monetary remedy, rather than providing effective enforcement of the laws that we have and allowing employees to pursue claims for unlimited damages, a step which would deter employers from acting in the way shown to be legally effective by P&O. Further, this type of collective breach of every employment law principle should have available for workers an opportunity to seek punitive damages, a means of punishing P&O for how they have behaved. Instead, we had the sight of bus loads of agency workers being shielded by security guards taking their places as loyal workers with long service were walked off ships with the promise of a large cheque and no job. I hope that the P&O case will stand as an effective case study to provide a reason for the law in this area to be subject to a careful review with straightforward proposals for reform seen as an industrial priority.