Large Scale Dismissals – are they legal?

In this article, we look at what happened a year ago, on the 17^th of March 2022, when P&O Ferries sacked nearly 800 UK employees, without, so far, serious consequences for the company.

We consider how UK law should protect employees during Large Scale Dismissals; What P&O did in March 2022; and what happened next.

We also look at what the UK Government did then and have done since –

Rishi Sunak, who was Chancellor at the time, said on the 20^th of March 2022 that “what we’re seeing is appalling and the way that they’ve treated their workers is awful…. We’re looking across Government at our contractual relationship with P&O and reviewing these”.  (The Government did indeed review this, and at the end of May 2022 it announced it was ending its contract with P&O – however in July 2022 it emerged that some Government departments may still be using P&O services).

Boris Johnson, who was Prime Minister at the time, said on the 23^rd of March 2022 that “It looks to me as though the company concerned has broken the law and we will be taking action”.  Later, in Parliament, Johnson said he believed P&O had broken the (amended) TULRA 1992 law, under which it’s a criminal offence not to notify the Government in writing 45 days in advance of making 100 or more redundancies.  He also said “P&O clearly aren’t going to get away with it”.

A few days later however, a Business Minister said the Government appeared to have no powers to ‘injunct’ P&O, and that only individual workers could take the company to court.

No criminal prosecution has ever been made against P&O Ferries for these Large-Scale Dismissals.  

A civil investigation by the Insolvency Service (IS) is still ongoing.  The IS has the power to disqualify company directors if they are found guilty of misconduct, including dishonest practice. The IS had concluded in August of 2022 that it had “no realistic prospect” of making a criminal conviction.

Currently the Government is ‘consulting’ on a new statutory code of practice against dismissal and re-engagement (“fire and rehire”) tactics, which would make it “explicitly clear to employers that they must not use threats of dismissal to pressure employees into accepting new terms…”. But the new code would not outlaw “fire and rehire” (or “fire and replace”) tactics, or stop large scale dismissals, it just says it should be a last resort option. The new code will be taken into account by Employment Tribunals where relevant and will allow the Courts/Employment Tribunals to increase the compensation companies have to pay to sacked workers by up to 25%, if the company didn’t follow the new code.

Several senior employment lawyers have criticised the new code for not being legally binding and for lacking disincentives to stop such actions happening again.

The new code is intended to provide guidance for employers and the consultation will close on the 18^th of April 2023. More details to follow once the Government replies to the consultation.

And we also look at what’s happened to the sacked P&O workers since and some information about their replacement crews.