P&O: The cost of not consulting

Watching the P&O Ferries situation over the last few weeks has been a real eye opener. The general public reaction has been shock and anger at how staff have been treated. Running alongside this has been commentary that redundancies are inevitable when profits are down. There's an assumption that people and profits are mutually exclusive in this situation, but I don’t see it as having to be a binary choice. Even in difficult times where tough decisions potentially need to be made, this can be done with kindness as byrne·dean founder Matt Dean highlights in this article.  Although P&O is an extreme example, the situation is a stark reminder of the need for all leaders not to detach their commercial decisions from the people and lives they impact.  

I know that redundancies are sometimes unavoidable. As an employment lawyer, it was part of my old day job to advise businesses on the law. Where the numbers of job losses were higher, so were the requirements and stakes. I’d advise that employers risked large pay-outs and fines if they didn’t inform and consult the right people. I knew that many found the process frustrating and time-consuming.  As I have stepped away from looking at things from a purely risk perspective, I have seen how consulting with staff is about so much more than avoiding the legal penalties for getting it wrong. For me it is about balancing the economic and social impact of redundancies and giving people a chance to be heard, have some control and be supported through a life-changing event.

One of P&O’s defences has been that they did not inform and consult staff and their unions because it would not have made any difference. I don’t accept this and given the reputational damage, I doubt P&O bosses genuinely believe it now either. In my experience, a well-managed consultation exercise, where the collective voice of staff is listened to, can make a significant difference to the people involved. I have seen first-hand how it has can lead to fewer job losses and better support for those affected. 

Even in situations where the business outcome has remained the same, effective consultation has made a real difference to the human impact of losing a job and this should never be underestimated. When I ask people in my sessions: how do you want to be treated at work? the most frequent responses are: respected, valued, listened to and as a human. Basic but fundamental expectations of an employer that can still be met, even during redundancies.   

People experience strong emotions when they learn of redundancy – shock, denial, anger, even depression… It can cause huge uncertainty, stress and anxiety and make existing mental health problems worse. However, if employers engage in a fair two–way consultation process, it can help reduce the impact and allow people more time to adjust – emotionally as well as financially.  

What about the fact that P&O staff may get pay-outs because of the failings here? Does that make it ok, as I have heard some suggest? In my view, the reality is that a few pay cheques’ worth of pay-off won’t come close to compensating people for losing their livelihoods (particularly when there are few other opportunities and in a cost-of-living crisis) or the stress, indignity and insecurity of a sudden dismissal. 

The wrangling over what P&O was legally required to do may continue for some time. However, I think it is important to remember that the law, and any financial penalties for breaching it, will only go so far in building in fairness and respect for people. Ultimately, businesses are made up of people and it is important that we all remind ourselves not to detach from the impact of decisions on other’s lives.   

At byrne·dean we often provide training to both upskill managers in effective consultation and to support staff representative groups so that they can be a meaningful employee voice in a number of business changes, not just where legally required. I have seen how having that open, two-way channel of communication can benefit not only the employees but the leaders to understand the impact of proposed changes. It can help them get changes right and implement them fairly. Many organisations either don’t have such channels or don’t use them effectively. If you would like to talk to us about how to get the most out of staff consultation, then please get in touch.