Ministers have canceled a contract with P&O Ferries after it fired nearly 800 sailors without warning in March.
The Interior Ministry announced that the agreement with the Border Force agency would end with “immediate effect”.
It follows that the Department of Transportation is closing a deal with P&O Ferries following a review in light of the mass looting.
An Interior Ministry spokesman said: “In response to P&O Ferries’ unacceptable behavior, Border Force has terminated its agreement with P&O to provide contingency travel services to juxtaposed ports with immediate effect.”
Transport Secretary Grant Shapps tweeted: “We have terminated the United Kingdom Border Force’s unique agreement with the company.
“We are reforming maritime law to prevent companies from exploiting legal loopholes and protecting workers’ rights.”
The ferry company was widely condemned after it fired 786 workers on 17 March without warning, replacing them with cheaper agency workers. Politicians and unions say the decision jeopardizes the safety of ships.
P&O Ferries were detained by the Maritime and Coast Guard Agency (MCA) for security reasons, including ships normally operating between Dover and Calais and from Larne to Cairnryan.
Part of the reason was due to the lack of training and familiarity of the crew. On the European Causeway in Larne, inspectors found 31 different defects, including problems with fire safety and lifeboat drills.
One week after the dismissals, the company’s CEO, Peter Hebblethwaite, admitted in a select parliamentary committee that he deliberately violated the labor law by not consulting the unions before dismissing the workers.
The company suspended services across the Canal after the layoffs, even during Easter. Shapps had told lawmakers that Hebblethwaite “should leave,” but the government has yet to carry out the financial sanctions it had initially threatened.
The Trade Union Congress (TUC) has written to the Bankruptcy Service, which is conducting criminal and civil investigations into the company, saying its executives must be disqualified.
However, Hebblethwaite said at an industry conference in May, “We haven’t behaved that day or since, as has been suggested to me and us.”
The government announced measures in the Queen’s speech this month to ensure that seafarers pay at least the UK national minimum wage. He said he would introduce laws to ban ferries from docking in UK ports if they pay workers below that level.