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Britain’s Economy Is Rigged Against Workers

The fact that P&O bosses can openly admit to breaking the law without fear of consequences exposes the reality – Britain’s economy is rigged against workers in the interests of a wealthy elite.

Workers protest P&O Ferry's sackings on 18 March. (Ian Forsyth / Getty Images)

On Thursday, P&O Ferries boss, Peter Hebblethwaite, made a truly shocking admission in Parliament: he knowingly chose to break the law by deciding not to consult with unions over the company’s dismissal of 800 staff. Sadly, however, thanks to pitifully weak employment protections in the UK, it was not all that surprising.

Over the past two years of the pandemic, we have seen an outright assault on working people. The Covid crisis has been used as cover for those at the top to shift power away from workers and those who are most in need. This imbalance of power has allowed around 500 new people to enter the billionaire class at the expense of the rest of us who are set to endure the biggest fall in living standards since records began. 

What’s more, we have seen the bosses of big businesses treat their workforces with utter contempt. Despite having taken millions of pounds of taxpayer money to keep their businesses afloat during the crisis, many companies have used fire and rehire tactics to bully their workforces into accepting lower pay and worse terms and conditions.

A Rigged Economy

In July 2020, following the dramatic decrease in aviation travel, thousands of long-serving British Airways cabin crew were served notice by the management of the flag-carrying airline. They were given the option of either accepting redundancy, or having to reapply for a similar job on less pay. 

Then, in April 2021, almost a thousand British Gas engineers were told they could either sign up to worse terms and conditions, requiring them to work longer hours with weekend shifts, or else they would lose their jobs. These are just a couple of examples of what has become an endemic practice across the UK economy—a TUC poll found nearly one in ten workers had been told to re-apply for their jobs on worse terms and conditions or face the sack since the first lockdown in March 2020—with the rich and powerful using the turmoil of the pandemic to line their own pockets whilst suppressing people’s wages and workplace rights.

Now, with the unlawful sacking of almost 800 P&O Ferries staff without any consultation, we have seen one of the most flagrant attacks on working people in the recent history of UK industrial relations. As the company’s CEO explained in his evidence to select committees on Thursday, they made a calculated decision to break the law because they reckoned, rightfully, that the unions would not accept their ‘new operational model’—management speak for slashing the cost of labour—and considered it more expedient to absent themselves from their legal obligations. 

In the minds of the P&O Ferries bosses, the only way their business could continue, following the fall in freight and passenger revenue in recent years, was to rid themselves of the longstanding, loyal workforce whose wages had been agreed through collective bargaining agreements with the unions. They could then engage agency staff on pay as low as £1.80 an hour. Any compensation that they would have to pay to former workers for breaking the law and sacking them without any consultation would be offset by the benefits of the ‘new operational model’. The CEO, earning a base rate of £325,000 a year (not including the two performance-related bonuses he has access to), would be able to sleep well at night knowing that his business could thrive on the backs of migrant workers earning almost a hundredth of his salary.

A Culture of Impunity

It’s this ‘break the law now, pay off people later’ Bullingdon Club mentality that runs through the upper classes of our society. Be it Peter Hebblethwaite or Boris Johnson, they know that they can get away with acting illegally, either because they won’t get caught and held to account, or, if they do, because they will still come up trumps within a system that always has their backs. So, Boris Johnson knows he can stick it out in No. 10 after having lied to Parliament and broken his own lockdown rules because he has the backing of the media and big business. Similarly, Peter Hebblethwaite understands he can continue to trample over workers’ rights, as long as the Tory government does nothing to stand in his way, or even promotes a situation in which law-breaking is good for a company’s bottom line. The fact that government ministers were given notice of these sackings, yet have done nothing substantive since they took effect, and are even set to grant the Dubai-owned parent company of P&O Ferries control over new freeports, shows the extent to which big business and the Conservative government work hand in glove.

To begin dismantling this corrupt, immoral system, what we need in the first instance is a strengthening of employment rights and protections, including the total outlawing of fire and rehire tactics. Legislation must be passed that would stop such pernicious industrial relations from being profitable—the only language that corporate fat cats speak. As labour law professor Alan Bogg made plain in his evidence to the select committees in Parliament on Thursday, the Fire and Rehire Bill brought forward last year by my friend, Barry Gardiner MP, would have helped in the case of P&O Ferries. Clause 2 of the Bill would have provided ‘injunctive relief’, which would have helped prevent what Professor Bogg called ‘fire and rehire on steroids’. The fact that the Tory government stood in the way of Barry’s Bill passing into law, and their failure just last week to vote in favour of a motion to outlaw the practice, has done much to create a culture of impunity among business.

How to Fight Back

As we enter the worst cost of living crisis in decades, now is clearly the time to strengthen employment rights in order to improve wages and rebalance the economy. If the current situation is allowed to go on without correction, it won’t solely be operators across the maritime industry that feel compelled to follow suit, spelling the end of any residual UK maritime workforce. We will also see a race to the bottom right across the economy, as businesses take the lead from P&O, knowing that they can blithely commit crimes of corporate thuggery, decimating workers’ rights and protections in the process.

So, what we need now more than ever is a New Deal for Working People, as I set out in the Labour Party’s Employment Rights Green Paper, published last year. Not only would this programme outlaw fire and rehire tactics, it would transform the world of work, treating people with dignity and respect, and addressing the imbalance of power by unshackling our trade unions to do their jobs, bargaining for and protecting their members. The events of recent days only serve to underscore how relevant and desperately needed it is.