Seafarers’ Wages Bill [HL] 2022-23

The Seafarers’ Wages Bill would, if passed, ensure seafarers working on ships that use UK ports at least 120 times a year are paid a rate at least equivalent to the UK national minimum wage for their work in UK waters.

The Bill, which is 184 of the 2022-23 session, had its first reading in the House of Commons on 8 November 2022. The Bill’s second reading is scheduled for 19 December 2022.

Background to the Bill

What is the national minimum wage?

The national minimum wage (NMW) was first introduced by the National Minimum Wage Act 1998.

Since the passage of the National Minimum Wage (Offshore Employment) (Amendment) Order 2020, the NMW applies to all seafarers on vessels on domestic UK routes. It applies whether the vessels were UK-registered or not and even if the seafarers are not ordinarily resident in the UK, but not to seafarers working on international routes unless their ship is registered in the UK and they are ordinarily resident in the UK.

Since 1 April 2022, the NMW for those aged 18 to 20 is £6.83 and for those aged 21 to 22 is £9.18. The UK National Living Wage (which is for those aged 23 and over) is £9.50.

For comparison, as of 1 July 2022, the International Labour Organisation’s recommended basic minimum wage for an “able seaman” is $US 648 (about £550) per calendar month. This is a non-binding international recommended minimum wage for seafarers under the Maritime Labour Convention.

This is based on seafarers working eight hours a day, or a 48-hour work week, meaning it is equivalent to an hourly rate of £2.66. International maritime law under the UN Convention on the Law of the Sea has made it difficult for the UK Government to legislate for a binding minimum wage for seafarers on vessels serving international routes to and from UK ports.

P&O ferries redundancies

On 17 March 2022 P&O Ferries Ltd made 786 seafarers redundant, without prior notice or consultation. The company announced plans to move to a new operating model using agency workers to crew its ships who would be paid less than the NMW.

In oral evidence to a select committee, P&O CEO Peter Hebblethwaite said the average hourly rate for the agency workers under the new crewing model would be £5.50 (PDF). Later in the hearing he said that the lowest hourly rate would be £5.15. The background and employment law issues raised by this incident are explored more fully in the Library briefing P&O Ferries: Employment law issues.

The Government’s nine-point plan for seafarers

On 30 March 2022, then Secretary of State for Transport, Grant Shapps announced nine measures the Government would take in response to the P&O Ferries redundancies.

The eighth of these measures was legislation to grant British ports powers to refuse access to ferries that do not pay their crew at least an equivalent to the UK National Minimum Wage.

The background briefing notes to the Queen’s Speech 2022 contained reference to a Harbours (Seafarers’ Remuneration) Bill. This was later renamed the Seafarer’s Wages Bill.

On 10 May 2022, the same day as the Queen’s Speech, the Government opened the consultation Conditions for harbour access and seafarers’ pay-rates: scope and compliance. Responses expressed concern about the need for ensuring consistency with international maritime law, and the role to be played by port authorities in the Bill.

What does the Bill aim to do?

The Bill seeks to ensure seafarers on ships using UK ports at least 120 times a year are paid a rate at least equivalent to the UK national minimum wage for work they do while in UK waters. This would apply regardless of the ship’s flag or the seafarers’ nationality.

Currently, seafarers working on international routes to orfrom UK ports are not entitled to the national minimum wage if they are not usually resident in the UK; do not work at least to some extent in the UK; or work on non UK-flagged ships.

If the Bill passed, it would mean that:

• Harbour authorities would have the power to request ship operators covered by the Bill to provide a declaration that their seafarers are paid at a rate at least equivalent to the NMW for their work in the UK or its territorial waters, if they did not already qualify for the NMW (Clause 3 of the Bill)
• Harbour authorities would be able to charge operators who failed to provide a declaration showing the equivilent rates (Clause 7)
• Harbour authorities could refuse access to the harbour if the operator failed to pay the surchage (Clause 9)
• The Secretary of State for Transport could appoint investigators from the Maritime and Coastguard Agency (MCA) to verify operators are complying (Clause 6)
• The Secretary of State would have powers to direct harbour authorities on whether to impose a surchase and how much it should be (Clause 11)

Commentary on the Bill

Representatives of the shipping and ports industry have welcomed the Bill’s intention but expressed concerns about its impact. The UK Chamber of Shipping said the Bill could potentially undermine existing international agreements.

The trade union Nautilus welcomed the Bill but warned that, as it relates to ships docking at a specific port, it could lead to operators ‘port-hopping’ to avoid regulation.

The National Union of Rail, Maritime and Transport Workers (RMT) urged the Government to support amendments tabled in the Lords by Labour peers to expand the scope of the Bill to also include roster patterns, fair pay and legal protection for seafarers (See section 5.3 of this paper, amendment 5).

Legal firm Burness Paull published an article on the Bill by one of its partners which expresses scepticism over whether the Bill will achieve its stated aims.

The Government has responded to several written questions on the issue of seafarers’ wages since the P&O Ferries redundancies and the announcement of its intent to legislate. It has reiterated the Bill aims to ensure seafarers with close ties to the UK are paid at least an equivalent to the UK National Minimum Wage.

Passage of the Bill in the Lords

The Bill as brought from the House of Lords contains 15 clauses. At third reading, two amendments both tabled by Labour peers, were defeated following a division.

The Delegated Powers and Regulatory Reform Committee (DPRRC) recommended that two sub-sections of the Bill be changed, as they granted excessive powers to the Secretary of State. The Government agreed with one of those recommendations and removed the original Clause 3(4)(a) from the Bill. This is the only amendment made to the Bill as presented to the Commons.