Boris Johnson’s government cannot force P&O Ferries to reinstate the 800 workers sacked without notice, a minister has admitted, as he called on the company to return ￡10m in furlough cash.

       Defence minister James Heappey said it would be “right” for the firm to hand back money claimed during the Covid pandemic – and suggested the government was looking at ways to reclaim it.

       “It certainly feels to me that it would be the right thing to do for P&O to hand that money back,” the minister told Times Radio. “I’m sure that colleagues at the Treasury and Department for Transport will be looking into it.”

       Labour leader Sir Keir Starmer has said the company “mustn’t be allowed” to get away with the mass sacking – but the defence minister insisted that it was a “commercial decision” ministers could not block.

       Mr Heappey said the company had behaved “disgracefully” but said the government was powerless to stop the ferry operator replacing the 800 workers with cheaper agency staff.

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       Asked if there was nothing the government could do, the Armed Forces minister told the BBC: “I think that is the reality .... Ultimately, it’s not something the government could have stopped P&O from doing.”

       Grilled on calls for the government to reclaim the furlough money, Mr Heappey told Sky News: “It’s exactly the sort of thing that if I were the Treasury I would be asking for.”

       The ferry operator, owned by Dubai-based logistics giant DP World, sparked outrage on Thursday when 800 workers were sacked immediately – with no notice – to be replaced by cheaper labour.

       The Rail, Maritime and Transport union (RMT) is seeking legal advice to challenge the mass sacking. Security guards boarded ships with handcuffs to remove fired crew, it was claimed.

       Karl Turner, Labour MP for East Hull, said P&O Ferries had received around ￡10m when around 1,100 workers were furloughed, and demanded the government get the money back.

       “All of that money, that ￡10m for furlough in the pandemic, should be clawed back,” the Labour MP told LBC. “Any money that the British taxpayer provided to that business should be taken back from them.”

       Mr Turner added: “And the government should be saying to the company, ‘Get round the table with the unions and negotiate some sort of deal’.”

       Sir Keir highlighted the fact the government rejected legislation aimed at stopping staff being replaced by cheaper labour, as he condemned P&O’s move. “It is absolutely disgusting what they are trying to do – they mustn’t be allowed to get away with it,” he said.

       On the “fire and rehire” practice, the Labour leader added: “I just wish the government had done what we said and strengthened employment rights so they couldn’t do this kind of thing. The government said it was going to deal with this sort of situation. It hasn’t done it.”

       But Mr Heappey defended the government’s decision to reject a bill aimed at stopping “fire and rehire” – though he suggested ministers may wish to look at the issue again.

       The minister told the BBC: “While the practise of fire and rehire is clearly despicable, and something the government has been clear it disagrees [with], the scope of the bill was too broad and would have been unreasonable and actually damaged the employment market.”

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       Mr Heappey added: “But I know that my colleagues in the Department for Business, Energy and Industrial Strategy are looking at how we do clamp down on this sort of thing.”

       Mark Dickinson of Nautilus International told BBC Radio 4’s Today programme that there are “serious safety concerns” around the decision by P&O Ferries to replace its seafarers with agency workers.

       But Peter Aylott, of the UK Chamber of Shipping, said he was “confident” that the agency workers hired by P&O Ferries to replace its seafarers will operate ships safely.

       A series of demonstrations will be held on Friday against P&O’s decision to sack 800 seafarers, with the RMT union calling for wider public support for demonstrations in Dover, Liverpool and Hull.