Tim Tyndall, employment partner at Keystone Law, reflects on the P&O Ferries redundancy controversy, telling Adam McCulloch that some facets of the government’s response to the 800 job losses have been ill-informed.
AM: Have there been any comparable cases that you know of?
TT: It happens more often than it should, but not on this scale. An employer might look at a business unit or individual and take a view that the cost of continuing employment is greater financially or in terms of disruption, than it would be for a commercial settlement, which takes into account the massively increased exposure to statutory claims. It’s not an approach that can be condoned legally or in terms of presentation for the reasons now so evident in the damage to P&O’s reputation.
Does this episode make UK employment laws look somewhat powerless?
Our laws are not powerless, but are certainly weaker than say France or Germany where, in essence, a dismissal has to have official approval before it is valid. Here, P&O has been able to price in the cost of its admitted flagrant breach of employment law. It is the availability of that “pricing in”or “taking a view” as an option that should be the subject of serious re-examination.
What did you make of the government’s response?
The government’s initial approach, echoed by the PM in the Commons, failed to recognise the changes made in the Seafarers (Transnational Information and Consultation, Collective Redundancies and Insolvency Miscellaneous Amendments) Regulations 2018, which were signed off by the then transport secretary Chris Grayling and with no visible objection from trades unions.
The government, including the PM, the attorney general and the transport minister, have threatened legal proceedings without thus far identifying what form they might take, which suggests that they recognise that the Seafarers Directive’s implementation by the UK’s statutory instrument is defective.
Is Brexit a factor?
It should be emphasised that this is not an EU issue but an outcome of the UK’s implementation of the directive. The law changes referred to might correct this anomaly, but it’s difficult to see how they can be applied retrospectively.
Might the former employees benefit from pursuing claims in employment tribunals?
The admissions by P&O in front of the business and transport committees last week that it intentionally broke the law when it did not consult with the unions, presents an open-and-shut case to the employees who wish to pursue compensation in the UK employment tribunals. However, if they decide to take this route, it will take many months for the amount of compensation to be determined. The compensation offered by P&O in the settlement agreements might be more commercially attractive than the prospect of drawn out proceedings against an organisation with an apparently fragile economic future.
Will the P&O crews gain from fines levied against their former employer?
There remains a dispute as to who was entitled to be told of the planned dismissals, be it the UK authorities or those where the ships were registered. That issue will not help the employees. Any legal action the government takes or fines it imposes will not help the P&O employees or put money in their pockets. The money will end up with the chancellor.