P&O Ferries has announced it will pay £36.5million in compensation to workers made redundant last week and replaced by agency staff paid less than the UK minimum wage.
The ferry operator was quick to outline its plans to compensate former employees in a letter today to Business Secretary Kwasi Kwarteng, who had demanded an explanation from P&O following a violent public backlash against the dismissals.
Some workers are in line for payments of up to £170,000 and no one will receive less than £15,000, P&O said.
Payments are tied to seniority, with former crew members receiving 2.5 weeks pay for each year they have been with the company.
P&O pointed out that the terms were more generous than the statutory minimum severance pay of one week per year of service.
He claimed the announcement represented “the largest compensation package” in maritime history. However, the RMT union called P&O’s announcement “bullying actions” and said the payments were only what staff were contractually entitled to.
P&O will give former staff members up to 13 weeks pay in lieu of notice and 13 weeks pay if there is no redundancy consultation period.
Some staff receive 91 weeks’ pay “and the possibility of new employment”, P&O said.
The company said 575 of the affected 786 sailors are in talks to move forward with redundancy offers.
P&O faced widespread anger after sacking its entire UK crew with immediate effect last week.
In their place, the company hired agency staff for as little as £1.81 an hour, according to the RMT union. P&O disputes this figure.
Some of P&O’s vessels are registered in Cyprus, which means the company does not have to pay the UK statutory minimum wage.
A P&O spokesperson said: ‘It has been an incredibly difficult decision for the company to make that choice or face corporate takeover.
“It would have meant the loss of 3,000 jobs and the end of P&O Ferries.
“By making this difficult choice, we have ensured the future viability of P&O Ferries, avoided large-scale and long-lasting disruption, and secured Britain’s trading capacity.”
Responding to the announcement, RMT union general secretary Mick Lynch said: “These are the actions of a bully trying to maximize profits by firing workers and replacing them with agency staff below the minimum wage.
“The detail of what the company imposes is not new. The 2.5 weeks is what we have negotiated in the past with P&O.
“The severance pay is not compensation, it’s just a payment that staff are contractually entitled to because no notice was given.”
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This notice was published: 2022-03-22 18:15:20