The Government has announced it will not start criminal proceedings against P&O Ferries over the company's decision to fire nearly 800 seafarers in March and then replace them with cheaper staff.
The Insolvency Service said on Friday that “there was no realistic prospect of a conviction” after a review by an independent senior prosecution lawyer, as it is standard practice.
A spokesman said: “After a full and robust criminal investigation into the circumstances surrounding the employees who were made redundant by P&O Ferries, we have concluded that we will not commence criminal proceedings.”
The Insolvency Service is still conducting a separate civil investigation.
The agency began the probe earlier this year under instruction of Business Secretary Kwasi Kwarteng.
The ruling comes a day after DP World, the Dubai-based owner of P&O, posted stellar financial results for the six months to June 30. Revenues surged 60pc to $7.9bn (£6.6bn) and profits jumped 50pc to a record $721m.
DP World told MPs that P&O “had no future” unless it cut costs by sacking the workers.
Mark Dickinson, general secretary of international seafarers union Nautilus, said: “This is a deeply disappointing decision and will be met with frustration and anger by the 786 seafarers and their families who were so cruelly discarded by P&O Ferries.
“The message is clear, P&O Ferries must be held properly accountable for their disgraceful actions and we will continue the campaign to ensure that the CEO and his fellow Directors are held to account and to make certain this can never happen again.”
P&O’s sacking of 786 workers in March sparked criticism from trade unions and politicians, leading the government to cancel a contract with the company.
The firm did not carry out consultations. Many of the employees were told about the firings via a pre-recorded video message.
P&O hired staff on more flexible contracts, paid on average £5.50 per hour – well below the UK’s minimum wage, but still legal as they are based offshore.
Chief executive Peter Hebblethwaite admitted in a meeting with MPs that P&O decided not to carry out consultations even though it was required to do so.
When asked if he had “wilfully” breached the law, he said: “I completely hold my hands up . . . we did choose not to consult.”
He said “no union” would have accepted the company’s proposals. The company was also required to inform the Secretary of State of the mass redundancies 45 days in advance.
In May, the Home Office scrapped a contract with the ferry operator as a result of its "unacceptable behaviour".
P&O declined to comment.