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'Some amount of skulduggery going on': The Iceland Saga

Iceland’s Irish operations have been in difficulty since their franchising last February

WHEN ONE HEARS the phrase “Iceland saga”, one expects a grand story of heroic deeds, against the backdrop of deep fjords and high mountains. Perhaps a hero appears, to slay a dragon or similar beast. The telling is exciting, and a good time is had by all.

Unfortunately, in this instance, that is not the case.

Rather than being the tale of noble deeds, this is the ongoing story of the frozen food chain Iceland, and its misadventures in the Irish market.

Once upon a time in Shropshire…

In operation since 1970, Iceland Foods Ltd has grown from a single store in the town of Oswestry, Shropshire, to having over 900 locations across the United Kingdom. The retailer specialises, as the name would suggest, in frozen foods, including pre-prepared meals.

Originally owned and operated by its founder, Sir Malcolm Walker, the position of Executive Chairman has since passed to his son, Richard.

Iceland initially opened its first Irish store in 1996. This initial phase of Irish operations expanded to seven stores, before closing due to financial difficulties in 2005.

However, despite this setback, in 2008 Iceland reached a franchise agreement with a Dublin-based cash and carry company, AIM, owned by Indian-born businessman Naeem Maniar.

This franchise agreement continued until 2013, at which point Iceland took back direct control of their Irish outlets.

Soon after, in 2015, ACCHL, AIM’s parent company, was appointed an examiner by the High Court due to its insolvency. It was reported at the time that the company owed €5.6 million in short term debt. The company was eventually saved, and continues to operate in Dublin today.

The seven stores that Iceland took back control of in 2013 were somewhat shy of the 45 that Maniar had committed to opening back in 2010.

The spring of discontent

Fast forward to 2023.

Iceland UK is experiencing retraction. After experiencing massive growth during the Covid-19 pandemic, the retailer is now facing store closures across the country.

In an effort to focus on its UK business, Iceland decided to revert to the franchise model that they had operated in Ireland between 2008 and 2013, and which they operate in a number of other European countries.

On 17 February, Iceland Stores Ltd sold their Irish operations – which had expanded from seven to 27 locations in total – to The Project Point Technology Ltd (PPTL), to the tune of €1.

Iceland Ireland Stores Ltd., which had been the subsidiary of the Iceland Stores Ltd, changed its name to Metron Stores Ltd, and became a subsidiary of PPTL.

The director of PPTL is none other than the previous franchise owner of Iceland’s Irish stores, Naeem Maniar.

The transfer came as a surprise to many, not least to those actually working in the stores.

Jamie Murphy, the General Secretary of the Independent Workers Union (IWU), which would go on to represent over half of Iceland workers in Ireland, said that as far as transfer of undertakings was concerned, things weren’t up to scratch.

Workers in stores were not informed of the sale until they received an email from a individual from a different company introducing themselves as the new area manager.

“There seemed to be some amount of skulduggery going on,” Murphy said.

Immediately after this, staff started to report issues.

Most were not being paid correctly, if at all. Many were being shorted hours, or weren’t being paid for annual leave, or for sick leave. However, Murphy says, these were put down by many as “teething problems” that come with being bought out by a new company.

“Only a minority of workers were being paid fully and correctly and above board,” he says.

By March, there was less willingness on the part of staff to overlook the issues that were arising.

On 21 March, Sinn Féin TD Louise O’Reilly raised the issue of incorrect and non-payment of wages in the Dáíl. She had been told by workers that stock in stores was low and that the company wasn’t trading as it had previously.
“They are fearful for their jobs and future,” she said.

One complaint cited by the workers was that electricity in stores had been turned off. At the time this was happening, Metron Stores which trades as Iceland was involved in legal proceedings against the ESB, after it had attempted to change electricity provider to Pinergy.*

As a result of the ongoing issues with pay, Sinn Féin councillor Daithí Doolan put Iceland workers in Dublin in contact with the IWU, who began to organise in stores.
Moving into April, a new issue arose.

Staff in the Dublin store began to report that air conditioning was being turned off. As a shop full of freezers generates a considerable amount of heat, staff were working in conditions described as “unbearable”. When this was reported to the union, Murphy contacted the Health and Safety Authority.

“I contacted the HSA and I explained the situation to them, and they said they’d look into it. However, when I contacted them again, they said they couldn’t comment as it was an ongoing investigation,” he said.

“When I asked if they would let me know the outcome when the investigation was concluded, they said no. So we actually have no idea what came of that investigation.”

The air conditioning in stores was turned back on soon after the complaint was made to the HSA, but it is unclear why. However, Murphy says that as air conditioning couldn’t be controlled in-store, that it had to have been done centrally.

By May, the disputes had escalated.

As a result of the continuing issues with wages, and frustrated by a lack of engagement by management, four Dublin stores – Coolock, Tallaght, Northside, and Ballyfermot – served notice of strike action. Of these, only Coolock and Northside went out on strike, and a picket was established at only one store, Coolock.

Tomás Sheehan, the IWU’s General Munster Branch Secretary, said the workers at the stores who were served strike notice were met by a mixture of promises and intimidation from management:

Maniar insisted that workers would be personally liable if they went out on strike, and said that they all had to get what he called a “letter of indemnity” from the union, which stated that the union was protecting them. This claim was false

However, between these threats and promises that their grievances would be addressed, both Tallaght and Ballyfermot suspended their strike action on 18 May. Coolock and Northside commenced their action the next day, although only one picket was established, outside the Coolock store.

Metron Stores Ltd claimed that the strike was illegal and that the IWU and the workers had failed to provide them with the legally required notice. They said that they had not received any correspondence from the union.

However both Murphy and Sheehan say that the union had informed them of every action they had taken in representing Iceland staff, including submissions to the Workplace Relations Commission, submissions to the HSA, and notice of strike action.

FwgXT9NXoAIW1_R An IWU picket in May @the_IWU / Twitter @the_IWU / Twitter / Twitter

Following the strike action, Metron Stores sought an injunction in the High Court against any further strike action. This was unsuccessful.

They also launched legal proceedings against the union, and personally named Murphy, Sheehan, Alexander Homits (the union’s main Dublin organiser) – though the court summons misspelt his name as Hormits – and one of the Iceland workers from the Coolock store. The proceedings have not yet progressed beyond an initial filing.

The June Days: Recalls, strikes and examiners

Midway through the month, on 15 June, the Food Safety Authority issued a recall order to Metron Stores on food “of animal origin” that had been imported to Ireland from the UK since 3 March. This accounted for the majority of Iceland’s stock.

The reason behind the order was traceability – Iceland was unable to provide it.

The FSAI said the food showed “inadequate evidence of traceability” and that there had been “a number of incidents of non-compliance with import control legislation”.

While the scale of the order was huge, there was little immediate action taken to highlight it on the ground by Iceland.

As reported in the Irish Times the day after the order, there was no indication that the FSAI had just issued one of their largest recall orders ever in one of Iceland’s city centre stores. Stickers still boasted of the savings that customers could avail of, albeit they were advertising empty shelves.

At a number of Dublin locations, said Sheehan, workers had to remove stock from freezers and leave it at the back of stores for collection, where it promptly rotted.

Speaking on Claire Byrne, Chris Elliot, Professor of Food Security at Queen’s University Belfast, emphasised just how monumental an order this was, comparing it to the horse meat scandal of 2013, or the dioxin crisis of 2008.

“This kind of thing usually only happens with a smaller company that struggles with the paperwork, for it to happen to a large retailer like Iceland is truly shocking,” he said.

A number of shipments were impounded at ports in Dublin and Liverpool, which were eventually destroyed. Those shipments alone were worth approximately €600,000.

The decision by the FSAI to issue the recall was cited by Metron Stores as a key reason behind their financial difficulty. Ross Gorman Bl said that both the FSAI ruling, and strike action, were two of the factors in the company needing to enter examinership, which they did on 20 June.

The High Court appointed a blast from Maniar’s past – Joseph Walsh, of JW Accountants, who had been the examiner appointed to ACCHL back in 2015 – to oversee the company.

His affidavit provided to the court – which included analysis of the Independent Experts Report carried out before the examinership hearing – highlighted a number of interesting points.

At the time when the examiner was appointed, Maniar wished to divest himself fully of Iceland Ireland, and so Walsh put an advertisement looking for investment interest in the Business Post on 25 June. Of those that expressed interest, an agreement has reportedly been reached with one yet to be revealed investor.

On 11 August, Currency Media reported that Tesco Ireland were in advanced talks to take over Iceland’s Ireland operation. If true, it would follow a similar acquisition of Joyce’s supermarkets in Galway in 2021. Tesco Ireland have been contacted for comment.

Metron Stores owed considerable debts to its parent company, The Project Point Technologies Ltd, over €32 million. This makes the purchase of the company in February by PPTL for only €1 stand out.

“The purchase of the stores in February for €1 was essentially just Maniar assuming his own debt,” said Sheehan.

In the examiner’s affidavit, it was highlighted that PPTL requested for the debt to be assumed in the initial purchase.

A further cost-saving measure seems to have been the non-payment of rents. The examiner’s report outlines a number of landlords of stores around the country who complain of non-payment, little to no communication from the company, and attempts to force rent reductions.

One employee of the Fermoy store – which has now closed – said that the landlord of the store was owed upwards of €10,000 by the company.

The initial report concluded that while the business could be saved, only 10 of the 27 stores would remain open.

On the same day as the examiner was officially appointed by the High Court, four Iceland stores were closed – Coolock, Talbot St, and Northside in Dublin, and Clonmel in Tipperary.

Staff at the Coolock store said that they had arrived that morning to be told that the store was closed and that their jobs were gone.

In response, they occupied the store.

They said that they wanted meaningful engagement from management on the subject of redundancies, as well as on the back pay that they were still owed.

Iceland Coolock-1 Some of the workers occupying the Iceland Coolock store Leah Farrell / Rolling News Leah Farrell / Rolling News / Rolling News

While the sit-in was supported by the IWU, it was a worker-instigated action.

The following day, after being given assurances that there would be engagement, the sit-in was ended.

However, on 26 June, staff at Talbot St gained access to their store, and began a sit in of their own. This was to last considerably longer – in fact, at time of writing it is still ongoing, crossing the 50 day mark on 14 August.

The issue of the workers and their entitlements continued to be raised in the Dáil by sympathetic deputies, but the government maintained that the proper venue for these disputes to be decided was the WRC.

“A robust suite of employment rights legislation is in place to protect employees. I emphasise that workers have statutory rights under a broad range of employment rights legislation,” said Minister of State at the Department of Enterprise, Trade and Employment Neale Richmond.

“Where employees believe their employment rights have been breached, they have the right to refer complaints to the Workplace Relations Commission for an adjudication and possible redress.

By July, the commitment to store closures came into effect.

On 8 July, Letterkenny closed its doors. On 11 July, Fermoy closed, followed two days later by Douglas and Middleton. On 22 July, Gorey and Wexford town shut. There was no indication which, if any, of the stores would reopen.

Speaking to The Journal earlier this month, a worker at the Fermoy store said that they found the whole thing “incredibly frustrating” and that they had been left with no communication from management or the examiner after the store closed.

Those who had been working in the stores were put on temporary lay off until a decision was reached on the stores’ futures.

However, this, said Murphy, was a decision made in bad faith.

“There’s supposed to be a reasonable expectation on behalf of the employee that the employer will be able to find the worker new work before the four weeks outlined in the legislation are up,” he said.

There were originally about 27 stores across the country. If that’s being limited to 10 profit-making shops, these workers around the country have nowhere to go. So putting them on temporary lay-off is just an excuse to delay redundancy payouts, and is putting them under more financial stress

Which brings us to now.

Talbot St is still occupied by their workers, and they held a rally to raise support on 8 August.

Staff of closed stores around the country are waiting to hear if their store will reopen or whether they’ll be eligible for redundancy payments. On 10 August a further two stores, in Tralee and Listowel closed, and the IWU sees little hope for their reopening.

The examiner is due in the High Court on 21 August to give their final report, and to reveal who is the investor that has agreed to take over the 10 profit-making stores.

It is still unclear at present which stores are counted among those considered “profit-making”.

*Clarification: A previous version of this article said that Naeem Maniar was involved in legal proceedings with the ESB. The case was taken by Metron Stores, trading as Iceland. 

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