P&O Ferries is holding firm on its decision to sack all its UK seafarers to bring in cheaper agency workers, while at the same time supporting an increase in the minimum wage.

Chief executive Peter Hebblethwaite said in a letter to UK transport minister Grant Shapps that to re-employ the 786 crew members would cause the collapse of the DP World-owned ro-pax company.

The boss was responding to a call from Shapps to reinstate the crews, which were laid off with no notice on 17 March, landing the shipowner in a media storm.

Hebblethwaite reiterated that all other options were considered, but the redundancies were the only way to save the loss-making company.

He wrote that the call to give the workers their jobs back “unfortunately.. ignores the situation’s fundamental and factual realities”.

“Complying with your request would deliberately cause the company’s collapse, resulting in the irretrievable loss of an additional 2,200 jobs,” he told Shapps.

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

Of the 786 sacked seafarers, “over 765” have now taken steps to accept P&O Ferries’ settlement offer, the letter claims.

More than 500 have signed the compensation deal. This includes 67 officers, who have either accepted the offer to work with the company’s new crew provider, or are in the process of doing so.

The CEO argued this means it is too late to back down, saying the crew members will “rightly expect us to comply” with the terms of the severance packages.

A supporter of higher wages?

In passages sure to anger unions, Hebblethwaite also addressed the prospect of the government changing the law to close the loophole allowing owners of foreign-flagged ships operating from the UK to avoid paying the minimum wage.

He said: “We welcome the government’s commitment to increasing the minimum wage for all seafarers working in British waters.

“We have never sought to undermine the minimum wage regulations. Indeed, from the outset, P&O Ferries has called for a level playing field regarding salaries on British ferry routes,” the boss added.

He went on to say that most of the needed cost savings arise from a new flexible working model, removing “job duplication”, rather than lower wages.

Flexible working still needed

“Please note that even if the national minimum wage were to be applicable, the need to adopt a different crewing model would not change,” Hebblethwaite wrote.

He said crews will be paid for the actual time they work, plus holidays, rather than receiving full pay for working 24 weeks a year as was previously the case.

The CEO again mentioned his “great distress” that no other options could be identified.

“I profoundly regret the pain caused to so many dedicated P&O Ferries employees,” he added.

“I can further assure you that I am fully cognisant of the reputational cost to the P&O Ferries brand and me personally,” Hebblethwaite concluded.

The RMT union's general secretary Mick Lynch called the letter a "direct challenge to the legal framework and government authority in Britain."

"The diabolical arrogance that is on display by P&O Ferries is equivalent to highway banditry and must be opposed," he said.

Lynch added: "This whole rotten fiasco shows why the government must step in, take over the running of P&O, and reinstate all 800 sacked staff with no loss of pay."

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