Seafarers' Wages Bill [ Lords ] (First sitting)

David Linden Excerpts

Committee stage
Tuesday 17th January 2023 Public Bill Committees

Deductions for accommodation are not explicitly prohibited by the maritime labour convention. Normal practice across the industry is that accommodation is provided free of charge, as it is essential to allow seafarers to do their jobs on board. We also note the Low Pay Commission’s recent recommendation that such deductions should not be allowed for seafarers who do qualify for the national minimum wage. We will be setting out the detail of how national minimum wage equivalence is to be determined in regulations, including the position on deductions. This has been the case for the national minimum wage legislation today in the UK, so the use of secondary legislation in this way is entirely consistent with existing practice and will ensure we get this complex matter right. We will be holding a public consultation on the draft regulations after the Bill has received Royal Assent.

[David Linden (Glasgow East) (SNP)]

It is a great pleasure to serve under your chairmanship, Mr Davies. I will start by returning to some of the comments I made on Second Reading. The Bill is far too narrow in scope. Considering the egregious behaviour of P&O, we could be doing much more. I hope the Minister will look at some of the amendments.

I rise to speak to amendments 44 to 47 and 49 in my name and that of my hon. Friend the Member for Paisley and Renfrewshire North. I should point out that amendment 49 is not dissimilar to Labour’s amendment 62, which we clearly support. In speaking to these amendments, I also want to oppose Government amendment 1, which would doubtless knock out our amendment 45. I will deal first with the issue of port hopping and national minimum wage equivalence.

In clause 3, the requirement to produce a declaration of national minimum wage equivalence is applied to services that call at a harbour 120 times a year. That is the result of a change made following consultation on the draft Bill, which had proposed covering ships that called at a port or UK harbour 52 times a year—once a week. In July, in response to the consultation, the RMT—the National Union of Rail, Maritime and Transport Workers, to which I pay tribute—proposed that the definition in the Bill should be this:

“Seafarers working on ferry services that are frequently operated from UK ports (at least once a week).”

However, following consultation, the Government changed the Bill to apply it to services calling 120 times a year.

The impact assessment says that part of the reason for the change is this:

“The more regularly a seafarer calls at a UK port, the closer their ties to the UK.”

I certainly believe, as I think the Government did, that calling at a UK port once a week is a sufficiently close tie between a seafarer and the UK economy. Indeed, their lordships speaking in support of the shipping and ports industry stated that the Government’s plans contravened the international maritime conventions, specifically the UN convention on the law of the sea.

It is my understanding that the British Ports Association has legal advice that the Bill will not work and will be subject to legal challenge, including on the ground that it infringes the UN convention on the law of the sea. Indeed, the International Chamber of Shipping has also raised the matter, as the shipping industry’s de minimis crewing practices and flagging policies rest on the assertion of innocent passage in international waters between states.

[Grahame Morris]

The hon. Gentleman is making relevant and sensible points. On the issue of the 120 days, we have concerns, which I am sure he shares, that there are so many exclusions that the Bill will be like a colander—full of holes. The original proposal was 52 times a year, or once a week. What will be the impact of the Bill on the offshore continental shelf with respect to the frequency of the use of supply vessels? Will the figure of 120 days effectively exclude them from the legislation? I suspect it will.

[David Linden]

I am grateful to the hon. Gentleman for making that point, which gets to both the nub of the issue and a source of real concern for me. He is right to talk about the colander effect, and not making the legislation sufficiently tight means that in many cases companies will exploit the measure, as has he eloquently outlined. Let us be honest: the legislation was introduced because a company sought—within the law—to exploit people, and it would be a dereliction of duty by the House and by the Committee if we did not seek to tighten the Bill in such a way as to ensure that industry cannot get away with using such practices.

[Gavin Newlands]

My hon. Friend has referred to the House of Lords, but on Second Reading in this place, the Secretary of State said in terms of the number of visits to harbour:

“We think the definition in the Bill at the moment will capture the vast majority of the services we wish to capture.”—[Official Report, 19 December 2022; Vol. 725, c. 66.]

The Secretary of State referred to “the vast majority”, but this relates to the national minimum wage. Why should we be happy with a majority, rather than ensuring that all employees get the minimum wage?

[David Linden]

Even if people were not around last night, it will not come as a huge surprise that the Government are not particularly wild about standing up for workers’ rights. We on this side of the Committee happen to be of the view that we should be doing everything we can to try to support workers—[Interruption.] The hon. Member for Crewe and Nantwich chunters. I am more than happy to give way if he wants to stand up and speak. If he wants just to make a wee bit of noise behind the Minister, he is welcome to do so.

We support returning to the stricter criterion of 52 calls per year, which is what amendment 45 seeks to do. This is a key test of the Government’s commitment to seafarer welfare, and they failed in the Lords when they narrowly defeated Lord Tunnicliffe’s amendment that aimed to restore the criterion of 52 annual harbour calls.

National minimum wage and domestic employment law are difficult to enforce and apply in the maritime sector. That is why employers such as Stena Line, which employs UK crew on international routes from UK ports in Cypriot-registered vessels, enter collective bargaining agreements with domestic maritime trade unions. The UK Chamber of Shipping estimated that up to 45 major ferry routes served the UK economy in 2020, but that is subject to change. For example, P&O closed Hull-Zeebrugge in October 2021, but DFDS opened an unaccompanied freight service between Sheerness and Calais earlier that year.

In my view, the Bill should cover crew working for operators of containers, bulk carriers, cargo ships and vessels working in the offshore energy supply chain, as well as ferries. In 2018, the RMT estimated that extending the national minimum wage to cover domestic and offshore energy routes would bring 13,000 seafarer ratings into scope. The impact assessment for the Bill estimates only the cost to employers, not the number of seafarers who would be covered by the Bill.

I am concerned that the Government have dismissed out of hand the unions’ concerns over avoidance techniques. Port hopping, as we often refer to it, remains a genuine avoidance technique that becomes far easier to use the more frequently a vessel calls at a UK harbour. At 120 calls per year, it would be far easier for operators to make minor changes to scheduled port calls in order to avoid the legislation. A threshold of 52 calls, which was in the Government’s original proposals, would be far tighter. It was changed only after consultation with industry, although the trade unions supported 52 calls. I go back to the point that if the Bill is about protecting workers—the very workers who were so cruelly shafted by P&O—then it is incumbent on the Government to listen to the voices of those workers and trade unions, not the voices of industry. That is the whole reason we are here.

Disappointingly, the Minister in the Lords, Baroness Vere, was unconvinced that that avoidance technique could be used. She said:

“I do not think operators would play switcheroo with UK ports because, frankly, their customers would not put up with it.”—[Official Report, House of Lords, 26 October 2022; Vol. 824, c. 1506.]

The translation of that is, once again, “Leave it to the markets. The markets will dictate.” If we have learned anything over the course of the last few months in this House and during the P&O debacle, it is that simply leaving it to the markets is not a great idea. I am not reassured that the logistics market will self-regulate. The recent merger between Cobelfret and Seatruck Ferries, two operators who have been paying seafarers below national minimum wage on regular international services from UK ports for years, frankly, also increases the prospect of avoidance techniques.

I hope that has outlined just some of our concerns on the issue. For those reasons, I will formally seek to divide the Committee and vote against Government amendment 1.

[Mrs Elphicke]

I will take the opportunity to speak to these clauses and amendments. They cover the short straits, and first I will comment specifically on the issue of 120 calls per year. Looking at the short straits, according to figures from the UK Chamber of Shipping, the number of port calls meets the threshold by 30 to 40 times in relation to the Dover-Calais and Dover-Dunkirk lines: around 4,000 port calls that are made would come within the legislation. Whenever we set a threshold, it is important to set it with reference to the matter that we are addressing. The evidence is very clear that 120 days is a relevant and, indeed, low threshold in relation to the particular services that we are seeking to address within the remit of this important Bill, which, as has been discussed, very much has my short straits of Dover at its heart.

I am conscious that some good points have been made in relation to seafarers more generally. I hope that we can show some global leadership on this issue. I have been pleased to have the opportunity to speak at great length about seafarers’ rights with my hon. Friend the Member for Witney when he was Ports Minister. Although I can understand the remit being extended in the way that is being sought within the remit of the Bill, we need to look at seafarers’ rights more generally, as well as those bilateral agreements.

I now turn to amendments 47, 62 and 49. The Minister made some helpful comments in introducing this section, but I ask him, if I may press him further, for an assurance of the position, particularly relating to the calculation for food and accommodation. If I were to work in McDonalds—indeed, I did so for a very long time and enjoyed it greatly—I could have a certain amount of food on my food break if I were to work for four hours. If I were to work for the entire day, I would get much more McDonalds food—very tasty. That food would be free to me as a worker and that is the principle that we want to see for those at land and within our waters.

However, I think that some of the concerns that have been raised must not be seen only through the lens of our own domestic legislation in relation to the minimum wage and its calculation. I have taken some time to look at how these issues are treated within our national minimum wage legislation on land and issues such as accommodation—staying on ship would not, in my view, fall within the current definition of “accommodation” and its applicability for national living wage purposes. But it is right that these issues have been raised and that they are looked into carefully as we go through because, in relation to the operation of seafarers, particularly on these routes, our domestic provisions are not the market provision for these matters. The market for this is global; the conditions are global and international. When we talk about common market practice, it is within a global and international setting, with different countries applying different regimes to their seafarers.

When it comes to seafarers’ rights, we tend to think that this means countries who are very international, such as the Philippines and others, but I will give the Minister a directly relevant example to this food and accommodation issue. The Danish Maritime Authority allows for seafarers’ food subsistence allowance to be deducted from the calculation of national minimum wage. It is a matter for negotiation, either collective agreement or individual contracting, but, none the less, in the application of their calculation of national minimum wage, they do—

--- Later in debate ---

[Mr Holden]

My right hon. Friend makes an important point. We are looking into the terms and conditions, which will be there in the regulations, and we will have a wide public consultation. He is absolutely right: we want to get this right.

The legal issue raised by the hon. Member for Wakefield was about legal risk in the 52 versus 120 days element. When a ship stops at multiple points in Norway, for example, then has one trip a week to the UK, to argue that it should be covered by UK legislation rather than Norwegian legislation would put it into a very difficult international legal position. Under international maritime law, that would expose us to greater legal risk for the entirety of the legislation, rather than on specific points. I hope hon. Members understand.

The hon. Member for Glasgow East made a number of comments. On the broad issues, at least, I say to him that the Government have raised the threshold at which people pay income tax, taking millions of people out of tax. They have introduced the national living wage and reduced the age at which people qualify for it. Moreover, and in a massive and long-term benefit for huge numbers of people, they have expanded auto-enrolment in pensions to hugely benefit working people. His comments were broadly ill judged and, in a certain way, bringing forward this conversation today shows our commitment to delivering for working people. While I appreciate that everyone in the Scottish National party is an expert on ferries these days, I am not sure they are when it comes to this legislation.

[David Linden]

Will the Minister give way?

[Mr Holden]

I have finished my comments already.

Question put, That the amendment be made.