Transport Secretary Grant Shapps has called on P&O boss Peter Hebblethwaite to leave his role after he said "he would do it all again" when asked about suddenly sacking 800 people.

It comes after the chief executive was questioned by MPs yesterday over the "brutal" sackings last Thursday.

The transport secretary told Sky News: "I thought what the boss of P&O said yesterday about knowingly breaking the law was brazen and breathtaking, and showed incredible arrogance.

"I cannot believe that he can stay in that role having admitted to deliberately go out and use a loophole - well, break the law, but also use a loophole.

Mr Hebblethwaite was questioned during a transport and businesses select committee yesterday where he revealed new workers will be paid as little as £5.50 an hour.

He said no union would have ever accepted the decision and the company decided to make up for this with large redundancy pay-offs.

The P&O boss said: "We chose not to consult the unions and decided we would compensate instead. These were very extreme circumstances. The change was of such magnitude that no union would accept it.

"We knew this was going to be controversial so it had to be confidential.

"This was a difficult decision but business would have otherwise closed, it was not viable."

"Overall the business was not sustainable and there could have been 3,000 redeundancies rather than 800 with substantial packages.

"The reaction to this has been extremely strong but there would be no P&O without this decision. We had to rebuild the business.

"People have cancelled booking. For Dover to Calais there has been a particularly large decline. Bookings there tend to be made two weeks in advance."

Jesper Kristenesn, chief operations officer for DP World, said: "The decision was not an easy one to sign off but we have done everything we can to make sure people were taken care of."

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During the session he admitted breaking employment law. But today he has told current staff that this was not the case and tried to reassure them it would not happen again.

In his message seen by Sky News Mr Hebblethwaite wrote:"I just want to reassure you on a few points, particularly following my appearance at yesterday's Select Committee with MPs and the media coverage this week.

"Most importantly I am incredibly sorry for any anxiety that I've caused you or your family in the last week - this was never my intention and I am painfully aware it feels deeply uncomfortable.

"There are a couple of issues I also want to make sure you're very clear on. The first is this type of dismissal could not and would not happen again. This was a unique situation.

"The second point is no criminal offence has been committed - neither me, P&O Ferries or our Shareholder, DP World would allow it.

"There has been a failure to comply with the obligation to consult. We have compensated all Jersey contracted seafarers for the lack of advance notice with enhanced severance packages which are believed to be the largest total compensation package in the British Marine sector - a total settlement of £36,541,648. Critically, no employee will receive less than £15,000 irrespective of their length of service."

Since the shock announcement last Thursday the scandal-hit company has announced a £36.5m compensation package which has seen 40 workers receive more than £100,000, while some are expected to get over £170,000.

Many others are set to receive less than £15,000, the company said.

There has been a major backlash from the public about the decision to let loose hundreds of staff - a decision which prompted two days of protests in Dover and saw calls from MPs for a criminal prosecution to be brought forward.

It was also suggested by North Thanet MP Sir Roger Gale that P&Os Pride of Kent ship should be renamed the "Shame of Dubai", as the firm is owned by Dubai-based DP World.