Definitive Report - Report No 404, October 2023

Case No 3432 (United Kingdom of Great Britain and Northern Ireland) - Complaint date: 11-MAY-22 - Closed

Allegations: The complainant organizations allege that 786 seafarers were dismissed by a company in the maritime industry without prior notice or trade union consultation, in breach of collective agreements concluded with two trade unions as well as the national legislation, and subsequently rehired under lesser working conditions or replaced by non-unionized agency workers

1. 610. The complaint is contained in a communication dated 11 May 2022 submitted by the Nautilus International (Nautilus), the National Union of Rail, Maritime and Transport Workers (RMT), the Trades Union Congress (TUC), the European Transport Workers’ Federation (ETF), the International Transport Workers’ Federation (ITF) and the International Trade Union Confederation (ITUC).
2. 611. The Government transmitted its observations in communications dated 9 March and 20 September 2023.
3. 612. The United Kingdom of Great Britain and Northern Ireland has ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), and the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. The complainants’ allegations

1. 613. In their communication dated 11 May 2022, the complainant organizations – the Nautilus, the RMT, the TUC, the ETF, the ITF and the ITUC – allege that on 17 March 2022, P&O Ferries (the company) summarily dismissed 786 seafarers who were directly employed by the company. According to the complainants, the seafarers were hand-delivered letters of instant dismissal. Those on board the vessels were escorted off past waiting replacement crews in coaches by hired security. One crew member, having been woken to be given the news, was given 15 minutes to collect his things. Cabins were emptied of possessions and one crew member said that it took 15 days before his belongings were returned to him. Two British crew members, sacked while their ship was in Rotterdam, were bussed to Calais and left to make their own arrangements to return home from there.
2. 614. According to the complainants, there was no prior consultation with the seafarers’ unions. No prior notice was given to the UK authorities or those of the countries in which the ships were registered. No warning was given to the seafarers at all.
3. 615. The complainants indicate that the company had collective agreements with the RMT and Nautilus. There was a “Recognition and Procedural Agreement” with each of the unions which conferred recognition on them and set out the procedure for negotiation with the employers. Pursuant to it, various substantive agreements setting the terms and conditions of employment were concluded. The latter provided that the agreements “remain in force indefinitely subject to ... a minimum of six months’ notice in writing to the other parties of their/its intention to terminate this Agreement”. The terms and conditions set out in these substantive agreements were expressly incorporated (together with any variations by subsequent collective agreement) into the standard form contracts of employment of the seafarers. Among the agreements on terms and conditions were provisions setting out a disputes procedure, both individual and collective. The latter provided a series of stages ending with the possibility of mediation and arbitration and the involvement of advisory, conciliation and arbitration service or third-party mediators or arbitrators and a status quo provision pending exhaustion of the procedure. The complainants allege that these agreements were intentionally and flagrantly breached by the company which disregarded the disputes procedure and, without saying so, effectively terminated the agreements without giving the specified six months’ (or any) notice.
4. 616. The complainants allege that that under the UK law, the collective agreements are not enforceable by the unions. The employer could and did breach them with impunity. Moreover, since the dismissals were instantaneous, the possibility of industrial action by the seafarers was denied to them. According to the complainants, under the UK law, the unions are prohibited from calling on other workers to take solidarity action in support of those dismissed. The RMT and Nautilus were thus denied the possibility of taking either legal or industrial action to protect the collective agreements, and the jobs, terms, and conditions of their members.
5. 617. The complainants consider that in dismissing the workforce, the employer completely failed to comply with its legal obligations to engage in consultation with Nautilus and the RMT, set out in section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) (also referred to in the relevant collective agreements between the company and the unions). According to the complainants, the CEO of the company admitted to the Transport and Business Select Committee of the United Kingdom’s House of Commons (Select Committee) that the company had a statutory duty to consult the unions but decided to flout it.
6. 618. In addition, the company failed to carry out its obligation to inform and consult Nautilus and the RMT, as required by regulation 13 of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE Regulations). The complainants indicate that the TUPE Regulations applied because the employer outsourced crew management to Malta-based, International Ferry Management (a corporation registered in Malta just one month prior to the mass dismissals international company), which engaged new crew through agencies to replace the dismissed seafarers thus amounting to a “service provision change”. Furthermore, according to the complainants, no individual consultations with seafarers were carried out, rendering these dismissals procedurally unfair under domestic law. They further allege that the dismissals were in any event unfair since they were caused by the service provision changes (TUPE Regulations 3 and 7) and not redundancies, as characterized by the company, as the company intended to (and did in fact) carry out the very same activities with new crew on board the vessels.
7. 619. The complainants allege that the company had long employed the device of flags of convenience on their vessels. To preserve the secrecy of the ambush, the company broke UK law by failing to inform the flag States of the alleged redundancies within the prescribed timeframes contained in sections 193-193A of the TULRCA. Whether or not this was a legitimate restructuring, which in the complainants view it was not, the dismissed seafarers should have been transferred under the exact same terms and conditions, and maintaining continuity of service duration, to the incoming crew manager. After the dismissals, some (less than 100) were offered, and accepted, jobs with the international company on inferior terms and conditions. The new jobs were only offered on condition that the dismissed seafarers sign a settlement agreement, barring them from claims against both companies.
8. 620. The company offered the dismissed seafarers the so-called enhanced redundancy packages which included compensation for the failure to consult the unions, unfair dismissal and all other claims – subject to them signing a settlement agreement, which bars them from commencing claims in the employment tribunal and contains a non-disclosure agreement (NDA) barring them from discussing the dismissals. The breaches of UK law entitle claims to be made in an employment tribunal. However, all such claims are subject to statutorily fixed (and very modest) maxima. For this reason, the company was able to quantify with precision what the cost of the dismissals by ambush would be and to assess how long it would be before that cost could be recouped from future profits generated by the poverty wages and diminished terms and conditions of the new crews.
9. 621. The complainants allege that months before the dismissals by ambush, the company had decided to replace the dismissed seafarers with non-union low-cost agency workers and made the arrangements to do so. The CEO of the company admitted to the Select Committee that the average wage of the incoming agency staff would be £5.50 per hour, with some to be paid as low as £5.15 per hour, which does not reach the UK National Minimum Wage. Furthermore, until their dismissal, crew worked on a pattern of seven days of consecutive 12-hour shifts, sleeping on board, followed by seven days off, all paid at the full rate; the replacement agency staff will, in some cases, work 12-hour days for 17 weeks. Not only will the hourly rate be lower, but the compensatory time off will not be paid at all, as these are voyage only contracts.
10. 622. Further still, the international corporation is discriminating against seafarers on grounds of nationality. For example, an Indian able seafarer is paid less to work far longer than a Georgian able seafarer doing the same job on the same ship. This discriminatory employment model is common in the ferry and wider shipping industry. The UK Government has pledged to review legislation (Equality Act 2010 (Work on Ships and Hovercraft) Regulations 2011, S.I. 1771 currently protecting seafarers from nationality-based pay discrimination, outside of the Maritime 2050 Strategy.
11. 623. At the Select Committee hearing, the CEO of the company stated that any “consultation process would have been a sham” and that the unions would “not accept” the new employment model, so the company decided to compensate staff instead. When asked at the hearing whether he would make the decision again, he said categorically that he would.
12. 624. The complainants consider that the actions of the company and the Government’s failure to enforce relevant labour laws and provide for dissuasive sanctions to ensure compliance have highlighted serious violations of freedom of association and collective bargaining. The company’s total disregard for the collective consultation provisions in the applicable collective agreements amounts to a breach of the principle of bargaining in good faith. The complainants point out that mutual respect for the commitment undertaken in collective agreements is an important element of the right to bargain collectively. Also, the failure to implement a collective agreement, even on a temporary basis, violates the right to bargain collectively, as well as the principle of bargaining in good faith. The failure of an employer to engage in full and frank consultation with trade unions when elaborating restructuring, rationalization or staff reduction plans constitutes a basic violation of the principles of freedom of association since trade unions have a fundamental role to play in ensuring that programmes of this nature have the least possible negative impact on workers.
13. 625. Considering recent industrial disputes at the company, the statements about trade unions made by the CEO of the company at the Select Committee hearing, the company’s disregard for the collective agreements and their abrupt termination, the absence of any attempt to negotiate replacement agreements, and the company’s use of non-union agency workers, the complainants believe that the dismissals of the 786 seafarers also constitute an act of anti-union discrimination. Dismissing a unionized workforce to hire an entirely non-unionized group of workers to carry out the job has the same chilling effect. It is also evident that existing legislation is insufficient to deter anti-union discrimination as employers can, in practice, on condition that they pay the compensation prescribed by law for cases of unfair dismissal, dismiss any worker, for being a union member with better terms and conditions under a collective agreement. Finally, the complainants consider that the United Kingdom’s labour market enforcement and sanctions regimes are wholly inadequate when a company can pay off its workforce so as not to pursue their rights under the law. The complainants conclude that the Government has failed in its proactive duty, as a Member of the ILO and as a party to Conventions Nos 87 and 98, to protect the fundamental rights of all workers, including seafarers, to associate and bargain collectively. In light of the above, the complainants call on the Committee to request the Government to:
    • call on the company to immediately reinstate the dismissed seafarers or in the alternative, ensure that the newly recruited seafarers are provided the same terms and conditions under the relevant collective bargaining agreements with the successor company;
    • introduce legislation to establish sector-wide collective bargaining between unions and employers in respect of all ferries serving ports in the United Kingdom, and make the collective agreements binding by law (as under the Wages Councils Act 1976);
    • remove the prohibition on secondary industrial action where the employer in dispute has failed to fulfil a statutory obligation to consult the recognized union;
    • amend the TULRCA to: (a) introduce a statutory right, where there is a failure to consult the recognized union, for the union to apply for an injunction to prohibit dismissals from taking effect, or, where they have taken effect, to reinstate the workers, until full and meaningful consultation has been carried out; (b) consider how to make it a criminal offence for a company and its directors to fail to consult the unions, punishable by unlimited fines; and (c) to provide that compensation for a protective award for failure to consult the unions be unlimited (it is currently capped at 90 days contractual pay);
    • amend the TUPE Regulations 2006 to introduce a statutory right, where there is a failure to consult the recognized union in good time before a relevant transfer takes place, for the union to apply for an injunction for the transfer proceedings to be seized until full and meaningful consultation has been carried out;
    • amend the Employment Rights Act 1996, to prevent the “fire and rehire” techniques that the company and the corporation were able to use in regard to the seafarers it re-engaged, and which has the effect, in practice, of undermining collective agreements to the detriment of trade union members;
    • implement stronger, flag-blind domestic legislation protecting all seafarers from all forms of discrimination;
    • work with trade unions to develop joint proposals for possible amendments to the Maritime Labour Convention, 2006 (MLC, 2006), as amended, to strengthen minimum standards on recruitment and placement and conditions; and
    • amend the Company Directors Disqualification Act (CDDA) 1986 to make for failure to collectively consult an express ground for disqualification as a company director.

B. The Government’s reply

1. 626. In its communications dated 9 March and 20 September 2023, the Government indicates that it has condemned in the strongest possible terms the actions of the company that gave rise to this complaint. The Government has provided support to the affected workers and has taken steps to ensure they were signposted to access appropriate support. It has also taken robust action to enforce the existing rules and is determined to take further action where needed to protect seafarers. However, it disagrees with the complainants that the law in the United Kingdom needs to be amended in the ways they seek. The Government provides the following observations to provide an explanation of the current law, the action the UK Government has taken, and how this addresses the issues raised by the complainants in relation to this case.
2. 627. In the United Kingdom, employers proposing to make more than 20 redundancies must in most circumstances consult employee representatives and notify the Secretary of State (or in Northern Ireland, the relevant department) in advance of such redundancies. The description below focuses on the relevant legislation in Great Britain (that is, England, Wales and Scotland), but equivalent provision is made for Northern Ireland by the Employment Rights (Northern Ireland) Order 1996. Section 188 of the TULRCA requires employers proposing to make 20 or more employees redundant from one establishment in a 90-day period to consult employees or their representatives in good time and in any event: at least 30 days before the first dismissal takes effect; and where 100 or more redundancies are proposed, at least 45 days before the first dismissal takes effect. The consultation must include consultation on ways to avoid redundancies, reduce the numbers of redundancies, and mitigate their impact. Section 189 of the same Act allows a complaint to be presented to an employment tribunal where an employer has not complied with the consultation requirement. If the Tribunal finds that the complaint is well-founded it may make a protective award of up to 90 days’ pay, intended to encourage compliance with the consultation requirement, and to punish employers who do not comply with it. Section 193 provides that the employer must notify the Secretary of State (in practice, the Insolvency Service, an Executive Agency of the Department for Business and Trade) of proposed collective redundancies within similar timescales. Under section 194, an employer who fails to give notice of proposed redundancies to the Secretary of State in accordance with section 193 commits a criminal offence and is liable to an unlimited fine. The notification requirement is modified in the case of vessels registered outside of Great Britain (or in Northern Ireland legislation, Northern Ireland). The European Union’s Seafarers Directive (Directive 2015/1794) required that EU Member States, as the United Kingdom was at the time, legislate so that in the event of collective redundancies aboard foreign-flagged vessels, the relevant employer is obliged to notify the vessel’s flag State. This supports the flag State in extending the protection of its employment law to seafarers aboard vessels they flag. Section 193A of the Act implements the Directive, requiring that the competent authority in the state where the ship is registered is notified of collective redundancies instead of the UK Secretary of State. This applied in the instance of the company dismissals, as the affected vessels were flagged outside of the United Kingdom (in addition to their seafarers being employed by a company based outside of the United Kingdom).
3. 628. The Government also indicates that as part of its long-term commitment to improving seafarer welfare and working conditions, the Department for Transport will keep under review the need for further legislative action. In particular, the Department will review the employment protection of those who work at sea, taking into account the comparable rights available to land-based workers and the internationally regulated nature of the maritime sector. The review will include consideration of whether the TULRCA provisions on notification of collective redundancies are sufficiently robust.
4. 629. The UK Government’s focus has been on the well-being of the 786 seafarers considering their appalling treatment by the company. As the complainants have requested, following the announcement of the company decision on 17 March 2022, the Government wrote to the company to express its anger and disappointment. In these letters, it pressed for the company to reconsider their decision and offered to facilitate any dialogue between seafarers, unions and the company. The Government made similar representations to the parent company, DP World, and on 28 March 2022 it wrote again to the company asking them to offer the workers their jobs back on the previous terms, conditions, and wages. The Government has also supported seafarers in recovering their belongings.
5. 630. The Government also asked the Employment Agency Standards Inspectorate to investigate the terms of agency workers’ contracts within its scope, which they have done. The Government also asked HM Revenue and Customs to focus minimum wage enforcement resources on the maritime sector to ensure companies in the sector are complying with their legal obligations in relation to pay.
6. 631. The Government does not believe that the current arrangements for collective bargaining in the United Kingdom need to be strengthened. Workers have a right to join a union, they have the right to organize and, in many workplaces, employers choose to recognize a union voluntarily for collective bargaining purposes. Where an employer refuses to recognize a union voluntarily, the union can obtain statutory trade union recognition so long as it can demonstrate to the Central Arbitration Committee (CAC) that there is majority support for union recognition in a workplace. There is no indication that different arrangements, including a sectoral bargaining framework, would have changed the decisions taken by the company in question.
7. 632. Similarly, the prohibition on secondary industrial action has no bearing on the rights of the workers affected by the company’s actions. Secondary industrial action is prohibited because it has proved to be highly damaging to the UK economy in the past. In the United Kingdom, workers have the right to strike against their direct employer where there is a trade dispute and where certain conditions are met. This right is given effect in the trade union legislation. The prohibition on secondary industrial action does not infringe the rights of the company’s workers to take legal industrial action in anticipation or furtherance of a dispute with their employer while they remain in employment. It also does not prevent those dismissed workers using their rights for peaceful campaigning and protest action. It continues to be open to them to seek redress in an employment tribunal, where they have been unfairly dismissed by the employer, and a remedy in court, where a contractual obligation in their terms and conditions of employment has been breached. The Government is therefore not going to legalize secondary industrial action.
8. 633. Making collective bargaining agreements legally enforceable would go against the United Kingdom’s voluntarist approach to collective bargaining, where in the great majority of cases many employers choose to recognize a union voluntarily. Most employers and unions have traditionally preferred not to have legally enforceable collective bargaining agreements, and the Government does not see why the law should be changed in this area to try and deal with this exceptional case.
9. 634. Furthermore, there are already clear rules in place requiring companies to consult when making large scale redundancies. At this stage, the Government does not believe that the issue here is the rules themselves but rather, as the company has admitted, the fact that the company decided to completely ignore them.
10. 635. The UK Government asked the Insolvency Service to review the actions of the company. On 1 April 2022, the Insolvency Service wrote to the Secretary of State for Business, Energy and Industrial Strategy confirming that following its enquiries it commenced formal criminal and civil investigations into the circumstances surrounding the redundancies. The Insolvency Service’s criminal investigation into the events surrounding the dismissal on 17 March 2022 of 786 seafarers employed by the company was into whether there had been a failure to notify the competent authorities of the flag States of the ships in breach of section 193 of the TULRCA as modified by section 193A and, if there was such a breach, whether that amounted to a criminal offence contrary to section 194(1) of the Act, and if it was, whether that was justiciable before the criminal courts of England and Wales. It also considered whether there was any secondary criminal liability on the parts of any individuals. On 19 August 2022, a Senior Insolvency Service prosecutor considered that the chances of proving that the employees were subject to section 193 were evenly balanced. Therefore, he could not say having regard to the Evidential Stage of the Full Code Test of the Code for Crown Prosecutors, by which he was bound, that the tribunal of fact was more likely than not to convict. As result, the Code prevented a prosecution being instituted. The Insolvency Service’s civil investigation into the circumstances surrounding the redundancies made by the company remains ongoing. As such it would not be appropriate for the Government to provide any further comment at this time.
11. 636. In May 2022, the UK Government actively supported measures to improve seafarer welfare at the International Labour Organization’s recent Fourth Meeting of the Special Tripartite Committee of the MLC, 2006. The United Kingdom voted in favour of the eight amendments to the MLC, 2006, proposed for adoption by the Committee, including measures to improve minimum standards on recruitment, placement and conditions. Measures to implement these provisions will be considered by the Maritime and Coastguard Agency (MCA) Tripartite Working Group (TWG) on the MLC, 2006, which includes seafarer unions. The MCA would be happy to receive proposals for future amendments to the MLC, 2006, to further strengthen standards for recruitment and placement for consideration by the TWG and with the Department for Business and Trade, the Government department which regulates recruitment and placement services in the United Kingdom.
12. 637. Regarding the request to amend the Employment Rights Act 1996, the Government indicates that it is taking action to address the practice of dismissal and re-engagement, also known as “fire and rehire”. It has launched a twelve-week consultation on a draft Statutory Code of Practice that will deter employers from using controversial tactics and failing to engage in meaningful consultations with employees and their representatives. The consultation process was concluded on 18 April 2023. While the Government still analyses responses and indicates that it will take the views expressed into account before publishing its response and the final version of the Code, it explains that the Code sets out employers’ responsibilities when seeking to change contractual terms and conditions of employment and seeks to ensure that dismissal and re-engagement is only used as a last resort. Once in force, an employment tribunal will be able to increase an employee’s compensation in certain circumstances by up to 25 per cent if an employer has unreasonably failed to comply with the Code. The Government considers that it would not be appropriate to impose an outright ban – there are some situations in which businesses may need the flexibility to use this option to save as many jobs as possible. The Code of Practice is a proportionate response, balancing protections for workers with business flexibility.
13. 638. The Government indicates that the Equality Act 2010 (Work on Ships and Hovercraft) Regulations 2011 provide a cross-cutting legislative framework to protect the rights of individuals and advance equality of opportunity for all; to update, simplify and strengthen the previous legislation; and to deliver a simple, modern and accessible framework of discrimination law which protects individuals from unfair treatment and promotes a fair and more equal society. The Government has begun work on the second post implementation review of the Equality Act 2010 (Work on Ships and Hovercraft) Regulations 2011. It acknowledges the objections to nationality-based differential pay as set out in the complaint and indicates that it will be consulting with social partners and other interested parties on this, as part of that review.
14. 639. Regarding the complainants’ call to amend the CDDA to make failure to collectively consult an express ground for disqualification as a company director, the Government indicates that although there is no finite list of conduct which may lead to disqualification, given the grounds for disqualification under the CDDA are already wide-ranging, it is not considered appropriate to seek amendment to include “failure to collectively consult” as an express ground for disqualification. The Government points out that section 12C and Schedule 1 of the CDDA already provide that the Court, when considering whether someone should be disqualified, or the Secretary of State, when deciding whether to accept a disqualification undertaking, must take into account, among other things, the extent to which the person was responsible for a company contravening any applicable legislative requirement. The extent to which the conduct of any director leads to disqualification will depend on all the circumstances of the particular case.
15. 640. The Government states its commitment to protecting workers’ rights and indicates that it has already brought forward several reforms to enhance seafarers’ employment protections. The National Minimum Wage is the statutory minimum wage for almost all workers in the United Kingdom. Seafarers’ eligibility for this right is a key concern for Government and other stakeholders. In 2017, a working group encompassing the Government and industry was formed to explore providing greater eligibility for seafarers of the National Minimum Wage. Included in this group were representatives from government departments, shipping companies and the maritime unions. In response to the recommendations of this working group, in 2020 the Government brought forward the National Minimum Wage (Offshore Employment) (Amendment) Order 2020 to extend entitlement to the National Minimum Wage to protect more seafarers. As a result, since 1 October 2020, seafarers ordinarily working in the UK territorial sea or UK section of the continental shelf on domestic voyages are entitled to be paid the UK National Minimum Wage. This change ensured fair pay for over 10,000 maritime workers across the country. The National Minimum Wage also applies to agency workers in the United Kingdom. This means that seafarers who are agency workers have the same entitlement to the minimum wage as non-agency workers. In addition, the National Minimum Wage also applies to any seafarers working in the UK Exclusive Economic Zone whose activities are in connection with exploiting and exploring of the seabed or subsoil.
16. 641. On 30 March 2022, the UK Secretary of State for Transport announced a nine-point plan for seafarer protection, a package of measures to ensure there is no repeat of the company’s actions. The plan boosts and reforms seafarer employment protections and welfare, ensuring they are paid and treated irrespective of flag or nationality, while closing down avenues that could give employers the ability to avoid doing so.
17. 642. In order to extend fair pay to more seafarers working in the United Kingdom, the Government is changing the law so that seafarers with close ties to the United Kingdom who work aboard services that call regularly at UK ports (more than once every 72 hours over a year) and who do not qualify for UK National Minimum Wage, will receive the equivalent of the National Minimum Wage through the Seafarers’ Wages Bill. According to the Government, this legislation, which is now in its final stages in Parliament, will achieve this by making access to UK ports conditional on vessel operators demonstrating that they are paying at least an equivalent rate to the UK National Minimum Wage to their seafarers while in UK waters. The plan is the centre of the Government’s response to the company’s decision to dismiss 786 seafarers without consultation or notice.
18. 643. The Government indicates that its officials have worked constructively and consistently with some of the complainants (RMT and Nautilus) since the dismissals took place, that it has been clear in its intention to hold the company to account and that the nine-point plan does exactly that. Under goal 8 of the nine-point plan, the Government is pursuing a number of initiatives to advance and protect the long-term working conditions of seafarers. For example, the Department for Transport has engaged with trade unions, industry and the UK Chamber of Shipping to develop a voluntary framework, the Seafarers’ Charter, to introduce a number of employment and welfare protections for seafarers. The Government provides information on the launch of the Seafarers’ Charter in Paris, alongside a similar initiative of the French Government, and explains that the Charter is intended to encourage ferry operators to commit to good working conditions for seafarers and that it is built upon provisions of the MLC, 2006, such as in the areas of overtime pay and social protection, and by recognizing good practice, incentivize it. The Government also continues to work internationally to encourage other States to adopt similar measures. Further, the Government is exploring welfare initiatives to improve the social connectivity available to seafarers and to better understand seafarer fatigue. The Government believes that this work will help it to make important steps to protect seafarers and ensure there is not a repeat of the company’s actions. The Government indicates that it continues to highlight its ambitious seafarer protections nine-point plan and the wider objectives of Maritime 2050 to international partners both bilaterally and at the multilateral level at every opportunity (including at the International Maritime Organization (IMO) and ILO), as we work towards a step change in seafarer protections and welfare at the global level.

C. The Committee’s conclusions

1. 644. The Committee notes that the complainants in this case allege that 786 seafarers were dismissed by a company in the maritime industry without prior notice or trade union consultation, in breach of collective agreements concluded with two trade unions and the national legislation, and subsequently rehired under lesser working conditions or replaced by non-unionized agency workers. The complainants further allege that the Government’s failure to enforce relevant labour laws and impose dissuasive sanctions to ensure compliance highlights violations of freedom of association and collective bargaining. In this respect, they allege that the legislation in force does not adequately protect against acts of anti-union discrimination and violation of collective bargaining rights. While the complainants also refer to issues of discrimination based on nationality, wages, work hours, and amendments to the MLC, 2006, to strengthen minimum standards on recruitment and placement and conditions, the Committee recalls that these questions fall outside its competence; it will therefore proceed to examine only the alleged violations of freedom of association and collective bargaining rights.
2. 645. The Committee notes that the Government does not dispute the facts of the case and condemns the actions of the company that gave rise to this complaint. The Committee notes the Government’s indication that it has provided support to the affected workers and has taken steps to ensure they were signposted to access appropriate support. The Government indicates that it has taken robust action to enforce the existing rules and that it is determined to take further action where needed to protect seafarers. While the Government agrees that the legislation has been breached, it disagrees with the complainants that the law in the United Kingdom needs to be amended in the ways they seek.
3. 646. The Committee notes that according to the complainants, under the current legislation, collective agreements are not enforceable. It further notes that the Government does not believe that the current arrangements for collective bargaining in the United Kingdom need to be strengthened and that making collective bargaining agreements legally enforceable would go against the United Kingdom’s voluntarist approach to collective bargaining. The Committee recalls that agreements should be binding on the parties and that mutual respect for the commitment undertaken in collective agreements is an important element of the right to bargain collectively and should be upheld in order to establish labour relations on stable and firm ground [see Compilation of decisions of the Committee on Freedom of Association, sixth edition, 2018, paras 1334 and 1336]. It further recalls that failure to implement a collective agreement, even on a temporary basis, violates the right to bargain collectively, as well as the principle of bargaining in good faith [see Compilation, para. 1340]. Recalling that meaningful collective bargaining is based on the premise that all represented parties are bound by voluntarily agreed provisions, the Committee urged the Government to ensure the statutory enforceability of every collective agreement among those represented by the contracting parties [see Compilation, para. 1335]. The Committee considers that collective bargaining implies both a give-and-take process and a reasonable certainty that negotiated commitments will be honoured. The Committee urges the Government, with the social partners, to ensure mutual respect for the commitment undertaken in collective agreements, which is an important element of the right to bargain collectively and should be upheld in order to establish labour relations on stable and firm ground.
4. 647. The Committee further notes the complainants’ allegation that under the legislation in force, trade unions are prohibited from calling on other workers to take solidarity action in support of those dismissed. In this respect, the Committee notes the Government’s indication that: (1) a prohibition on secondary industrial action has no bearing on the rights of the workers affected by the company’s actions; (2) in the United Kingdom, workers have the right to strike against their direct employer where there is a trade dispute and where certain conditions are met; (3) secondary industrial action is prohibited because it has proved to be highly damaging to the UK economy in the past and (4) therefore, it is not going to legalize this type of industrial action. At the outset, the Committee recalls that a general prohibition of sympathy strikes could lead to abuse and workers should be able to take such action provided the initial strike they are supporting is itself lawful [see Compilation, para. 770]. The Committee recalls that it had previously requested the UK Government to take the necessary measures to ensure that sympathy strikes were protected under the law (see Case No. 2473, Report No. 346, para. 1543 and Report No. 349, para. 277). The Committee requests the Government to engage with the social partners to overcome challenges regarding the legislative prohibition on sympathy strikes, in conformity with freedom of association.
5. 648. As concerns this particular case, Committee notes the Government’s indication that the prohibition on secondary industrial action does not prevent those dismissed workers using their rights for peaceful campaigning and protest action and that they can seek redress in an employment tribunal, where they have been unfairly dismissed by the employer, and a remedy in court, where a contractual obligation in their terms and conditions of employment has been breached. The Committee understands, however, that to be rehired (albeit, according to the complainants, on inferior terms and conditions), some seafarers (less than 100) signed a settlement agreement, which precluded them from commencing claims in the employment tribunal. While the complainants do not indicate whether other seafarers applied to an employment tribunal, the Committee notes their indication that while breaches of the UK law entitle claims to be made in an employment tribunal, such claims are subject to statutorily fixed (and very modest) maxima; for this reason, the company was able to quantify with precision what the cost of the dismissals would be and to assess how long it would be before that cost could be recouped from future profits generated by the poverty wages and diminished terms and conditions of the new crews. The complainants thus allege that the dismissal of 786 seafarers to replace them with non-unionized agency workers constitutes an act of anti-union discrimination. The complainants further allege that the existing legislation is insufficient to deter anti-union discrimination as in practice, employers can, on condition that they pay the compensation prescribed by the law for cases of unfair dismissals, dismiss any worker for being a trade union member with better terms and conditions under a collective agreement. The Committee recalls in this respect that protection against acts of anti-union discrimination would appear to be inadequate if an employer can resort to subcontracting as a means of evading in practice the rights of freedom of association and collective bargaining [see Compilation, para. 1082]. The Committee considers that it would not appear that sufficient protection against acts of anti-union discrimination, as set out in Convention No. 98, is granted by legislation in cases where employers can in practice, on condition that they pay the compensation prescribed by law for cases of unjustified dismissal, dismiss any worker, if the true reason is the workers trade union membership or activities [see Compilation, para. 1106]. The Committee recalls that the Government must ensure an adequate and efficient system of protection against acts of anti-union discrimination, which should include sufficiently dissuasive sanctions and prompt means of redress, emphasizing reinstatement as an effective means of redress [see Compilation, para. 1165]. Furthermore, the compensation should be adequate, taking into account both the damage incurred and the need to prevent the repetition of such situations in the future [see Compilation, para. 1173]. The Committee therefore requests the Government to ensure an adequate and efficient system of protection against acts of anti-union discrimination, which should include sufficiently dissuasive sanctions and prompt means of redress, emphasizing reinstatement as an effective means of redress.
6. 649. The Committee requests the Government to provide information on all developments in respect of the above recommendations to the Committee of Experts on the Application of Conventions and Recommendations (CEACR) to which it refers the legislative aspects of the case.
7. 650. The Committee notes the information provided by the Government on the measures it has taken to address the matters raised in this case. The Committee notes, in particular, that the Government asked the Insolvency Service to review the actions of the company and that a formal civil investigation is currently under way. The Government has launched and concluded a 12-week consultation on a draft Statutory Code of Practice that will deter employers from using controversial tactics, such as the practice of dismissal and re-engagement, also known as “fire and rehire”, and failing to engage in meaningful consultations with employees and their representatives. According to the Government, the Code sets out employers’ responsibilities when seeking to change contractual terms and conditions of employment and seeks to ensure dismissal and re-engagement is only used as a last resort. The Government indicates that once in force, an employment tribunal will be able to increase an employee’s compensation in certain circumstances by up to 25 per cent if an employer has unreasonably failed to comply with the Code. The Committee also notes the Government’s indication that as part of the Government’s commitment to improving seafarer welfare and working conditions, the Department for Transport will keep under review the need for further legislative action and as part of this work, will review the TULRCA with a view to assessing whether its provisions on notification of collective redundancies are sufficiently robust. The Committee welcomes the Government’s indication that since the dismissals took place, its officials have worked constructively and consistently with some of the complainants (RMT and Nautilus) and that it has been clear in its intention to hold the company to account and that it had developed a nine-point plan to that effect. Observing that in its 2022 direct request on the application of Convention No. 98 by the United Kingdom of Great Britain and Northern Ireland (published in 2023) the same issues had been raised by the TUC, the Committee expects the Government to provide the CEACR with full and detailed information on the measures it has taken to address the matters raised in this case and the outcome achieved.

The Committee’s recommendations

1. 651. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) Collective bargaining implies both a give-and-take process and a reasonable certainty that negotiated commitments will be honoured. The Committee urges the Government, with the social partners, to ensure mutual respect for the commitment undertaken in collective agreements, which is an important element of the right to bargain collectively and should be upheld in order to establish labour relations on stable and firm ground.
   • (b) The Committee requests the Government to engage with the social partners to overcome challenges regarding the legislative prohibition on sympathy strikes, in conformity with freedom of association.
   • (c) The Committee requests the Government to ensure an adequate and efficient system of protection against acts of anti-union discrimination, which should include sufficiently dissuasive sanctions and prompt means of redress, emphasizing reinstatement as an effective means of redress.
   • (d) The Committee requests the Government to provide information on all developments in respect of the above recommendations to the Committee of Experts on the Application of Conventions and Recommendations (CEACR) to which it refers the legislative aspects of the case. The Committee expects that the Government will provide the CEACR with full and detailed information on the measures aimed at addressing the matters raised in this case and the outcome achieved.
   • (e) The Committee considers that this case is closed and does not call for further examination.