Are the P&O Ferries sackings legal?

2 years ago 33
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By Michael Race and Nicholas Barrett
Business reporters, BBC News

Image source, Getty Images

P&O Ferries has been criticised by politicians and unions after announcing in a video call that 800 staff were being sacked with immediate effect.

A cross-party group of MPs has condemned the company's action as "callous" and "disgraceful". But did P&O's move break the law?

According to employment lawyer Holly Cudbill, if the P&O employees' contracts are governed by UK law, then the answer is almost certainly yes.

"Simply dismissing 800 employees without going through the legal process, is unlawful," she says.

Beth Hale, partner at employment law firm CM Murray, says P&O should have consulted with unions and staff about potential dismissals and notified the government that hundreds of jobs were at risk.

"It's potentially an enormous breach, but they purport to be paying their way out of it."

Rosemary Connolly, an employment solicitor, says that while she couldn't say if the P&O broke the law, she did believe employees could take action against the company.

"It's certainly not in conformity with any of the established provisions of employment law," she adds.

What rights do workers have?

Under UK law, employers planning to make 20 or more staff redundant within any 90-day period, must first consult staff and speak to trade union representatives.

If this doesn't happen, employees are entitled to take their employer to a tribunal.

Ms Connolly says it appears P&O set aside the consultation phase and moved to terminate workers, as the process of consultation "ordinarily takes quite a lot of time".

"If consultation is going to be meaningful it needs to be a proper exchange," she says.

She believes that P&O staff who have been sacked, might be able to argue that their dismissal was unfair and make a claim.

Kate Palmer, HR advice director at Peninsula, agrees.

"There has been no meaningful consultation at all. It should be two-way process where the employees have the opportunity to put forward alternatives to that enforced termination and none of that has happened. So is it a fair process? No, based on that alone."

What problems might workers have in bringing a case?

Ms Connolly says a problem in such cases is that any action by the workers is "very much after the horse has bolted". Staff would have to wait months on average for an outcome.

She points out staff would have no jobs potentially during the claim period and would have to pay legal costs even if they win their case, although unions might help with those.

Image source, Getty Images

Image caption,

P&O workers in Dover protest against their sacking

However, the fact that P&O's owners, DP World, are based in Dubai, should not affect employees making a case for wrongful dismissal, according to Ms Connolly.

She says that under UK employment law, workers' rights are based on the "jurisdiction from which you work" - in other words, because they work in the UK, they are covered by UK law.

If this wasn't the case, she says, companies could just register themselves abroad and employment law could be ignored.

Could the government get involved?

Downing Street has said it received no prior warnings from P&O, although it is understood senior officials in the Department for Transport were informed on Wednesday of P&O's intentions.

According to the government's website, failure to comply with the rule "may result in prosecution and a fine, on summary conviction, for the company and/or officer of the company".

Armed forces minister James Heappey called P&O's actions "disgraceful" but told Sky News that the government "cannot force an employer to continue to employ people that the employer has said it doesn't want to employ."

Has this happened before and is it common practice?

"It's relatively uncommon that an employer would side-step all of the procedural steps that you should take before even contemplating a mass sacking of this nature," says Ms Connolly.

Nathan Donaldson, a solicitor at Keystone Law, says the approach adopted by P&O is "not unheard of", but agrees with Ms Connolly that it is "exceptional to forego appropriate notice and consultation processes".

Mr Donaldson says a government review of "fire and re-hire"- where employers dismiss some of their workers and hire them back straight away on worse deals - did not outlaw the practice, but emphasised "that it should be a process of last resort".

Chris Deeley, of JMW Solicitors, says other businesses might look at P&O's actions and "consider taking similar steps" to save costs and avoid lengthy consultation processes.

"However, P&O's actions - committing what seem to be flagrant breaches of employment law, and simply paying off employees to overlook them - is not an example we would advise any employer to follow."

What is P&O saying?

P&O Ferries have not responded to the BBC's request for comment regarding suggestions it might have breached UK employment law.

The company has said the job terminations were a "tough" decision but its business would "not be a viable" one without the changes.

It said: "We have made a £100m loss year-on-year, which has been covered by our parent DP World. This is not sustainable. Without these changes there is no future for P&O Ferries."

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