UK & Europe
Employment, Pensions & Immigration
The UK Government’s plans to introduce pay protection reforms for seafarers employed on ferries which regularly enter UK ports have been met with some opposition from ship operators, unions and port authorities.
With the public consultation now closed, we await the Government’s final decision on its proposals, which are reported to affect tens of thousands of seafarers. Although hailed by the Government as ‘a major step forward on pay protection’, the British Ports Association (BPA) has already said that it has concerns about ports being made to regulate ships and that ports do not "have a core competency" in enforcing the minimum wage.
The proposal, which was formally announced in the Queen’s speech, is for new legislation which will enable port authorities to impose fines, and ultimately prevent ferries that don’t pay their workers the equivalent to UK national minimum wage from docking at UK ports. The public consultation sets out the detail on how this will work, and largely expands on the proposals to protect seafarers announced by the Secretary of State for Transport on 30 March 2022 in response to P&O’s decision to dismiss 800 workers (see our previous update Government announces new measures to protect seafarers).
Broadly, the following categories of seafarer (subject to some exceptions) are currently entitled to the National Minimum Wage (NMW):
However, seafarers who work on vessels entering UK waters as part of an international voyage are considered to be under innocent passage and are not affected by UK NMW legislation. The current Government Guidance published in response to the October 2020 legislation expanding NMW legislation to some seafarers provides some specific examples of innocent passage which include “ferry services operating between the UK and mainland Europe”. Read our article for more on the October 2020 changes.
Similarly, vessels exercising the right of transit passage will likewise not be affected by UK minimum wage legislation. Transit passage refers to navigation through straits which connect the high seas.
The Government’s intention is to indirectly grant protection to seafarers working on ships that regularly use UK ports, by making access to UK ports conditional on operators of frequent and scheduled services evidencing that the seafarers onboard are being paid at least the NMW. The Government is not seeking to extend legal entitlement to NMW to seafarers, but rather ensure that they are paid no less than an equivalent sum for the time spent in UK waters.
A consultation on the proposed measures was open for a period of just 4 weeks until 7 June 2022. It examined the type of services that could be included beyond ferries, how to define the “National Minimum Wage equivalent” and what the enforcement measures will be. Views were also sought on compliance costs and other effects of the proposals.
In particular, the consultation sought views on the following proposals:
The Government announced on 10 May that it will implement the changes in the next parliamentary session and will consult closely with the ports and maritime sector on the new laws.
In addition, the Government is continuing bilateral discussions with France, the Netherlands, Spain, Germany, Ireland and Denmark. This aims to establish routes between the countries as ‘minimum wage corridors’, where seafarers on routes between either country must be paid at least the equivalent of the minimum wage.
The consultation closed for comments on 7 June 2022.