P&O Ferries - floating sweatshop

The shocking story of how P&O Ferries maximises profits before caring for its employees.

I've spent 50 years of my life associated with the shipping industry working the great and the good - from Townsend Thoresen Car Ferries, Atlantic Steam Navigation Company, Holland America Line, Cunard Ellerman, Atlantic Container Line, Wallenius Lines, Wallenius Wilhelmsen and now as a board member oof the Seahorse Freight Association.

As far as I am aware all the shipping companies I worked on behalf of as a public relations consultant paid their staff decent wages and were well run.

When Townsend Thorsen Car Ferries - my first PR job - was acquired by P&O Ferries after the terrible ‘Herald of Free Enterprise’ tragedy, I had hoped that all would be well. Frankly, things could not have got much worse than they did in the latter days of Townsend Thoresen when its parent company European Ferries took its eye of the ball. But it did.

A recent ITV News and The Guardian investigation revealed that P&O Ferries’ crews are earning less than ￡5 an hour - well below half the minimum wage - thanks to a gap in legal protection for seafarers, which the government promised to close. They are and expected to work 12 to 13 hrs days seven days a week without a break.

As part of its undercover investigation ITN and The Guardian board the ship and spoke to crew on the company's Dover-Calais run. Under anonymity they told the journalists they routinely worked 12 hour shifts, seven days a week, for up to 17 weeks at a time, without a day off and without permission to leave the ship. The average hourly rate was ￡4.87 an hour.

?“It’s the same place, the same people, you cannot go outside,” one crew member told us. “You go crazy. Every day it’s sleep, work. Sleep, work. That’s it”.

One crew member said the experience was “like [being in] a jail”.

On March 17, 2022, the company sacked 786 of its staff without warning and replaced them with agency workers who it said earned an average hourly rate of ￡5.50 an hour.

P&O admitted it had broken employment law by failing to consult the unions but insisted it had no choice as it needed to save money to avoid bankruptcy.

If this was a UK-registered clothing manufacturer the health and safety executive would be all over them.

But because P&O Ferries’ Dover-Calais ships are registered in Limassol, Cyprus they can get away with it even though they daily sail in and out of British territorial waters.

At the time, the company’s actions were widely condemned.

Grant Shapps, who was Transport Minister, accused P&O of behaving like “pirates of the high sea” and pledged to compel the company to pay UK minimum wage, which is ￡10.42 an hour and will rise to ￡11.44 an hour next month.

But while the Seafarers’ Wages Act became law last year, the secondary legislation that is necessary to implement it has not yet been laid.

The documents ITV News and The Guardian examined were from workers from developing countries. The crew were employed by PhilCrew Management, a recruitment agency based in Malta.

P&O hires crew from a variety of countries, including India, Philippines, Indonesia, Honduras, Mauritius, Malaysia, Georgia, Serbia, Latvia, Russia and Ukraine.

Many crew told us they found it exhausting to work 84 hour weeks for several months at a time and that they missed their families.

As it stands, P&O’s conduct is entirely legal.

The company is exploiting a gap in the law that means it is not required to pay the minimum wage to seafarers who work on foreign-registered ships that sail in international waters and are employed by agencies outside the UK.

Two years ago, the government said it would change the law.

On March 28, 2022, Mr Shapps wrote to the chief executive of P&O, Peter Hebblethwaite and promised “this government will not stand by while the requirement to treat seafarers with due respect and fairness is brazenly ignored”.

On April 27, 2022, Mr Shapps told the Commons Transport Select Committee P&O Ferries would need to do three things “to get out of this mess”: pay its crew the UK minimum wage; give back the ￡11 million of furlough money it received from the government during the pandemic and sack Mr Hebblethwaite.

As yet, none of these things has happened.

Industry insiders tell us that by dramatically reducing its wage bill, P&O has also been able to lower its prices and gain a competitive advantage over its rivals.

Yet, the company was able to invest ￡200 million in two new super-ferries for the Dover-Calais route.

In 2023, P&O’s freight and passenger traffic increased sharply between Dover and Calais - the UK’s busiest ferry route.

According to data from Freightstat, P&O won business from the ferry operator DFDS and Eurotunnel - both companies which pay the UK minimum wage.

P&O told us the company is “now on track to be profitable”. The company’s accounts for the year ending December 2022 are more than two months overdue at Companies House - a delay that constitutes a criminal offence.

P&O says the accounts will be filed “imminently”.

Two years ago, P&O Ferries took a risk.

The company knew that illegally sacking staff would be controversial but it gambled that the shock and the anger would fade.

Today, bookings are up and overheads have been reduced. P&O’s gamble appears to have paid off.

You can read the full story here: https://www.itv.com/news/2024-03-18/p-and-o-ferries-paying-crew-under-5-an-hour-after-government-pledged-minimum-wage