In a short video message yesterday, P&O terminated the employment of around 800 employees with immediate effect. Redundancy is cited as the reason for their dismissals, although P&O still requires staff to perform the roles of the sacked crew. Going forward, P&O intends to engage a “third party crew provider” to provide agency staff to crew their vessels. In effect, the employees’ roles are being given to agency workers. Is this a redundancy situation? Possibly, although the circumstances are unusual: although the need for the work remains, P&O no longer needs employees to do that work – it is choosing to outsource the work instead. That said, even if there is a fair reason for the dismissals, the manner in which P&O has conducted the dismissals, without any consultation, will inevitably mean the dismissals are unfair.

Also, where a business proposes to make 20 or more employees redundant, it must comply with statutory collective information and consultation obligations, meaning there should have been consultation with the trade unions and no dismissals should have taken effect for 45 days after the start of the consultation period. Tribunals can award up to 90 days’ gross pay per affected employee where a business fails to inform and consult. P&O has reportedly indicated that staff will be paid generous settlement sums provided they enter into settlement agreements within a two week period. Settlement sums would need to cover notice pay, redundancy pay, payments for failure to inform and consult, and compensation for other claims, including unfair dismissal.

It is possible that the employment of the dismissed crew should have transferred to the new crew provider under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (known as “TUPE”). By law, the new provider could be liable for the cost of the dismissals, although P&O may agree to assume liability for this and to indemnify the new provider. There are additional obligations to inform and consult under TUPE with awards of up to 13 weeks’ gross pay per affected employee made for failure to do so.

P&O’s directors may also be criminally liable if they failed to provide advance notice to the Secretary of State for Business, Energy and Industrial Strategy of the dismissals using a Form HR1. Company directors of Sports Direct made headlines when they were subject to criminal prosecutions for similar failings.