The boss of cross-Channel ferry operator P&O has admitted his company pay on-board crew just £4.87 an hour – and that he wouldn’t be able to live on such a wage.
P&O Ferries CEO Peter Hebblethwaite – who was paid £508,000 in his role last year – faced a grilling this morning from the Select Committee on Business and Trade, in Westminster, as it discussed labour rights.
He was asked in the opening question by the committee’s chair, Liam Bryne, if he was a “modern-day pirate”, before being pushed hard on the wages and conditions for seafarers on board his vessels following the mass redundancies two years ago and low pay rates since introduced.
In a remarkable move to slash its wage costs, on March 17, 2022, crews were told to return to port only to be informed by video message they were all being made redundant and replaced by cut-price agency staff.
It created a storm of protest, with 786 seafarers laid off.
Speaking of the move, which was widely condemned at the time, Mr Hebblethwaite said: “We recognise that we made a very difficult decision two years ago – one that was legal – but […] one that I wish we had never had to make in the first place.
“But we also have to acknowledge that without that difficult decision, P&O would not be here today.”
He said the decision safe-guarded 2,000 jobs.
But he said on-board crew – all of whom today are employed by an agency – were not being exploited and resisted calls for an independent investigation into the company’s employment practices.
It comes amid changes to French employment law which will see an increase in the minimum wage. The P&O boss was pushed on whether it would result in pay hikes for those currently on board.
He added: “These are international seafarers that our crewing agent is recruiting from an international field and we pay substantially ahead of the international seafaring minimum wage.
“The changes to both the UK and the French law maintain a level playing field and therefore we are operating within the same bounds as our competitors and that is all we’ve ever asked for – a level playing field – so that we can build a competitive business.
“You can take from the retention levels that the crewing agent experiences, and their ability to recruit the highest standard of international seafarers, as hard evidence that people who could work anywhere in the world on any ships have chosen to work for P&O.”
Despite the backlash that followed the mass sackings, the Insolvency Service later said it would not pursue criminal proceedings against the company, which has been owned by Dubai-based DP World since 2019.
It replaced the sacked workers with overseas agency staff, and told Parliament in 2022 its agency workers’ pay averaged £5.50 per hour.
Since then, an analysis of payslips conducted by the Guardian and ITV News suggested that P&O agency workers had in some cases been earning about £4.87 an hour, which Mr Hebblethwaite confirmed today.
Committee chair Liam Byrne asked Mr Hebblethwaite: “Are you basically a modern-day pirate?”
Mr Hebblethwaite did not respond directly to the accusation.
Mr Byrne later asked: “Do you think you could live on £4.87 an hour?”
Mr Hebblethwaite said: “No, I couldn’t.”
The UK minimum wage was £10.42 an hour at the time, and rose to £11.44 an hour in April.
But for maritime workers employed by an overseas agency, who work on ships which are foreign-registered in international waters, the rates do not apply.
When asked whether the legal changes would result in more lay-offs and large-scale staffing changes, Mr Hebblethwaite could not give a guarantee either way.
Trades Union Congress general secretary Paul Nowak said Mr Hebblethwaite’s response showed “zero remorse” for laying off workers.
He added: “It beggars belief that P&O Ferries has faced no sanctions for its misdeeds and that its parent company DP World has continued to be awarded government contracts.”
