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Iceland: A Cold House for Workers

The Iceland Dispute has demonstrated beyond all doubt what a fighting union can achieve.

 

By Mícheál Ó Súsleabh and Cristina Diamant

 

In February, a group of retail investors met and, over the course of 45 minutes, decided the fate and future of over 300 workers at the Iceland retail chain in Ireland. The refrain we hear from Irish society's optimates is that we should be grateful to live at a time of full employment, and that if we are not happy with it, we can always go somewhere else. The reality is that work in Ireland is becoming meaner and more isolated, and without the protection of trade unions, the majority of people in our country are left completely at the mercy of the whims of suits who think that they are owed a living from the hard work of everyone else. They believe that they are deserving of society and that everyone else has to accommodate themselves to their priorities.


The Irish labour market is suffering from serious instability. Workers in some sectors are also suffering from serious illusions that they are living in a country where their rights are protected by law, and where they will never be at risk of maltreatment or unfair dismissal. Some workers even believe that they are part of the ruling class and will be spared when their livelihood becomes inconvenient for someone else. Our experience tells us different—and a big part of the message and success of the Iceland dispute has been getting the message through that this could happen to anyone. Anyone could wake up in the morning and find a door slammed shut in their face, with bills to pay and a family to feed.


We live in an era of unprecedented mental health crises when people are struggling with learned helplessness—when you are told constantly and repeatedly that you are powerless and have to accept the demands and dictates of the wealthy, it can lead to a dehumanising loss of agency. This state of affairs is actively encouraged by a capitalist class that sees working class people as less than human, and wants to ensure that they can get away with the most with the least resistance. There are no social supports available for people in our atomised neoliberal society. We spend our lives, cradle to grave, working ourselves to the bone in the belief that if we are loyal, productive members of society, we will be recognised and protected. Instead, workers frequently find themselves treated as an afterthought, or worse, as refuse.


The one place where workers can claim back their dignity and unity, find a real sense of community, and assert themselves from a position of real social and economic strength is in a trade union. The majority of the establishment trade unions in Ireland are not interested in such empowerment of ordinary people, because an activist trade union membership can present a threat to the security and interests of senior trade union members. The union structure is unique in that it contains both volunteers and employees, and while there are many dedicated, sincere, and morally strong trade unionists operating in every organisation, many have also resigned themselves to putting in time since social partnership—or worse, fooled themselves into thinking that they’re running the country.


These are the challenges facing the Irish trade union movement—a class to represent that is disillusioned with the failures of a trade union movement that is unresponsive to their needs, that is been bullied into giving up trying to improve their lot, and has been lulled into a false sense of security by a pale imitation of functioning industrial relations machinery. It was in this context, and in this difficult situation, with many companies exiting the labour market or reducing their workforce that the Independent Workers' Union set out to organise a campaign for workers in 2023.


 

Dare to Struggle, Fight to Win

When the Independent Workers' Union (IWU) first heard of the issues that workers were experiencing in Iceland stores in March, we immediately dispatched organisers to stores in Dublin. The structure of the Dublin branch had recently been overhauled and there is a new focus on campaigning and investigating any potential leads that might lead to the unionisation of workers facing difficult conditions without support from an existing trade union. While the Iceland stores in Dublin were not unionised, many of the workers had experience through their families and communities of industrial action, and many had previously witnessed the Debenhams dispute where another UK-based company closed all of its Irish options, locking workers out without any appropriate redundancy arrangements.


Many UK businesses have exited the Irish market in similar circumstances in recent years, citing Brexit and regulatory impositions as reasons for closing poorly operating branches and moving to franchise models or exiting entirely. Despite the apparent problem of moving goods across the border in the Irish sea, Iceland appears to have totally changed its business model during the takeover, switching from a distribution system that saw stock arriving overland from the North of Ireland to the Republic, to a system of importation by ship from Liverpool and other port cities to Dublin. Naeem Maniar, an Irish-based Indian businessman, who had previously owned Iceland as a franchisee in Ireland before placing the business into examinership, took over operations for a token price of one euro.


Naeem Maniar embarked on immediately downsizing, closing the head office entirely and focusing on cost-cutting. The removal of all centralised administration seems to have backfired badly and shown flagrant disregard for the structural integrity and operational effectiveness of the company. Without closely co-operating administrative staff, there does not appear to have been anyone to notice the problems which were accumulating, including payroll issues with workers going unpaid and not receiving holiday entitlements, importation papers not being checked for validity and appropriate paperwork not being filed with the relevant authorities. Many workers at Iceland attempted to raise these issues with management but were ignored entirely. There was clearly an impetus within Iceland to get as much profit out of the company as possible in the short-term. Leaseholders and suppliers went unpaid, and there is much evidence to suggest that this is a recurring strategy as part of strategic bankruptcy, with the backers behind Maniar running up impossible debts, possibly even stripping assets off the books (an associate of Maniar has been alleged to strip shops which have been shut down due to non-payment of rent and hold the fixtures hostage until a favourable lease termination is arranged), and then running for the safety of examinership by court order protecting them from their creditors.


Of course, the creditor who has sweated the most to keep the company running and stands to lose the most by the destruction of the company is the workers themselves, and in this shady and dodgy dealing, they appear to never have been a consideration or taken seriously by management. After all, there is no incentive for management to pay attention to the needs and wishes of their employees unless they band together and force them to pay attention.


And this is exactly what the Iceland workers did. While the industrial relations machinery and court system in Ireland may offer a potent force for the protection of capital and the interests of businessmen, there is little option for worker to avail of to recover their wages beyond going to the Workplace Relations Commission (WRC), where there is every pressure on them to give up and let go of their hard-earned wages when adjudication can take over a year, and the actual receipt of money from a WRC decision might not come down the line until after eighteen months, while the company harangues and victimises them.


 

Action Produces Results

Throughout April the IWU focused on organising the workers, building links between its activists and building a rapport at different stores, and carrying out surveys to establish how many workers were owed wages and the amounts involved. During the month, the management shut off air conditioning at several stores to save on electricity builds and workers were forced to work in sweltering 35-degrees Celsius (95-degree Fahrenheit) indoors while customers complained and stock spoiled. The IWU made several attempts to contact the new franchisees to enter into negotiations representing its members, but were ignored. In May, with eleven thousand euro owed to workers and several stores having been fully unionised, the IWU balloted its members for strike action. On 19 May 2023, workers at the Coolock and Northside stores walked out in one of the first industrial actions of the year.


They met profound support from a community disgusted at the way they had been treated, and several thousand euros was collected for a solidarity fund from many sources, including other trade unions lending an arm in support. With the owner, Naeem Maniar, running scared to several stores to reassure the workers that conditions would change and improve, it appeared the company had finally gotten the message and things calmed down for several weeks as a slow trickle of money came into workers who had been unpaid. This seems to have been a temporary development of conscience, however. On 16 July 2023, the Food Safety Authority of Ireland (FSAI) carried out a product recall of all animal products sold in Irish Iceland stores. Shortly after, on the 21 of July 2023, Iceland workers throughout the country showed up for work, and in an act of utter disrespect, found their stores closed without any notice to them.


 

A Better Way is Possible

One of the most positive things to emerge from the Iceland dispute is politicians calling for increased funding for Labour Court inspections and for inspectors to visit stores more frequently to nip distressful working conditions in the bud. It was pointed out that the state had acted quickly to protect consumers from potentially harmful meat products, and to ensure that unlawful importation of goods was not occurring, but it failed to show the same concern or consideration for the hardworking employees who had been disrespected and mistreated by the company. This was no mere oversight: not much seems to have changed since the summer of 2020, when an IWU representative spoke before the Oireachtas [1] about the contrast between the state's immediate concern with consumer safety as opposed to concerns for workers in meat plants notorious for COVID-19 re-infections where unsustainable targets led to repetitive strain injuries and accidents. The neoliberal fantasy stays the same: shelves have to stay consistently stacked, rendering the hands they pass through invisible. These only briefly become visible to the consumers when things do not go according to plan and they have to intervene, correcting rather than anticipating and eliminating issues. Interestingly, the consumers' demographic also played a role in how close the public personally felt to the mistreated Iceland workers: these stores were small operations, without a self-checkout option. Human interaction, however brief, was built into its business model.


The issue needs to be treated as a symptom of a larger, more pervasive issue rather than an irrational exception. To adequately treat it, the regulatory system needs to have more bite, which runs contrary to the model of "social partnership," cloaking the simple fact that employers do not see trade unions as equal partners in the labour market but as a thorn in their side, holding them back from increasing their profit margins at the expense of the employees they treat as a resource easily discarded. This is precisely why simply raising the issue in the Dáil [2] is insufficient: when the law has no teeth by design, political representatives may feign surprise, dodge calls to action with vague promises of further consultation or even claim victimhood for being put on the spot. The real target is not one representative or another failing constituents, but an entire class pretending not to be actively waging class war.


In 2001, the European Parliament passed the Transfer of Undertakings Directive 2001 which has long since been transposed into Irish domestic legislation. One of the key issues at the heart of the Iceland dispute is that the transfer of undertaking procedures provided for in the domestic legislation on foot of the Transfer of Undertakings Directive 2001 have been totally disregarded. Several of the core stipulations of this legislation, such as workers being informed directly of any change to pay and conditions with ongoing engagement, were totally skipped over. Article 7 of the Transfer of Undertakings Directive 2001 states that employers must consult their employees prior to even considering a transfer of undertakings, and this obviously has not taken place given the total dearth of communication with the workers. EU legislation is frequently held up as a paragon of workers' rights, but the reality is that EU legislation, even where it has been given effect in member state law, is frequently ignored when it favours workers’ rights but enacted all too stringently when it favours the bosses.


There are numerous examples of CJEU rulings serious affecting the rights of workers, including recent rulings on pay for posted workers, as well as the infamous EU Commission vs. Luxembourg case, C-319/06, where the EU commission leveraged competition law to force down workers’ pay and condition. Since then, the IWU through its activity in the meat industry in Ireland has represented a number of agency workers who were falsely posited as being employed by a Polish agency and subject to Polish pay requirements and industrial relations and tax schemes. If EU Law is at all to be taken seriously or put forward as being "progressive" in relation to Labour law, then it has to be totally reconfigured to put real teeth on the violations of its terms and to curtail the pro-capitalist litigiousness of the EU Commission. In Ireland, either the WRC or the Corporate Enforcement Authority urgently require scope to aggressively pursue companies that ignore Transfer of Undertakings (TUPE) legislation, up to and including investigation of sites on foot of complaints by the Labour Court.


When fighting a feature of neoliberalism, however, legislative tools prove inadequate compared to community-led solutions. Petitions can be ignored by decision-making bodies, but phone banking, a strategy successfully employed by other likeminded organisations, such as CATU (Community Action Tenants' Union), disrupts daily operations enough to force the responsible party to at least listen to grievances. Industrial action remains the gold standard at the core of our entire outlook, but we need to move past a restrictive legal environment for this power to again approach its past zenith, and we need to hone and refine our political strategy and interactions with other causes.


 

Piercing the Corporate Veil

In the aftermath of the beginning of closures, the company filed for examinership, and an examiner was appointed to manage the company’s future and find new investors. The company appears to have abused a concept of "temporary layoffs" in the hope that it could avoid paying out any of its obligations with respect to redundancy, and there has been little explanation from the company to the court of how it was going to find an investor after such severe mismanagement and reputational damage. Questions were raised about how its massive debt of 32 million euros to the parent company and Naeem's other concerns had been accumulated, and whether the overall situation of examinership was an attempt to get as much out of the business as possible while avoiding these obligations—in effect, pulling a stroke both on the state and its own employees and business partners.


The whole situation establishes the desperate need for reform of industrial relations and corporate governance structure in Ireland. A number of companies have exited and are planning to exit the Irish market—restrictions and structures should be in place to force companies that are planning to engage in capital flight to pay a fair share to workers who have contributed so much to their profits over so many years. Workers should have an option of first refusal, companies should be required to pay workers as their first priority and should not be allowed to avail of the protection of the courts in the manner that the current examinership system allows. This enables, facilitates, and rewards dishonest behaviour rather than protecting debtors. If someone owes money for their mortgage, they lose their house, if someone owes dozens of millions, they get a write-off and go back to their other profitable businesses and continue their affluent lifestyle, while their workers try to pick up the pieces of their lives.


As outlined in a 30 May 2023 article in the Ditch, Metron Stores Limited in Ireland is a shell company of Project Point Technologies, owned by Naeem Maniar and a mysterious Trust. This layering of companies is popular amongst Irish businesses to insulate owners from any possible responsibility for corporate misdeeds. It has been exploited by Naeem Maniar and others at the Workplace Relations Commission (WRC) to argue that they are not the employer of the Iceland workers, and that it is in fact solely Metron Stores Limited that should be named as the workers' employer. This tenuous legal argument hints at the numerous options available to employers to circumvent their obligations to workers through the corporate veil, the separate personhood and legal identity of businesses. While in common law jurisdictions, judges may sometimes decide to "pierce the corporate veil" where they hold the employer responsible for wrongdoing and require them to shoulder liability for irresponsible decisions, this is rarely seen in practice and is usually only carried out where criminality in other respects is occurring. The result is that fly-by-night companies, and even some larger institutional enterprises, can compartmentalise their company structure and pursue greater risks at limited cost as a result. There will never be an appetite to face down this behaviour and force dishonest actors to accept their social responsibilities without well-organised and sustained pressure from labour unions.


It should speak to the inadequacy of "social partnership" between conventional ICTU trade unions and the state that after nearly 30 years of close collaboration, we are in a weaker position vis-à-vis the capitalist class than we were before, and the calculated exploitation of loopholes in the law obvious to many who encounter them regularly at the WRC continues unchallenged.


 

An Example for the Future

Several store occupations and a further strike have ensued. The Independent Workers' Union has held rallies outside the occupied Iceland store on Talbot Street and alternated shifts occupying the store with workers and other union members. People from throughout the country have contributed support, both financial and physical, and the effect of rallies has been uplifting in reminding workers that their concerns are important, and their contributions are valued. People who otherwise may have been left alone in one of the darkest hours of their lives have instead had the solidarity of the entire community celebrating their struggle with music and camaraderie.


The examiner has been forced to engage with the workers and take account of their lost wages. A new investor has been found, and with hundreds of Iceland workers, now the majority in the entire country, members of the Independent Workers' Union, there is hope that we now have the bargaining position to force the new owners to give their employees the option of relocation to other parts of their business or a serious and substantial redundancy package.


The Iceland dispute has been a microcosm of the wins that can still be achieved, even with all of the power arrayed against our struggle. The current state of the trade union movement in Ireland and the world can be demoralising. It can seem at times like there is no trade union "strategy" to speak of, and that trade unions are playing a subservient role in society. However, by looking the past for inspiration, by studying the triumphs of Connolly and Larkin, and understanding that no worker is ever truly alone, but that we are all members of the same class and working together in the same struggle, we can unlock an unstoppable power. Our role as activists now is to make sure that no one who is marginalised or ignored goes voiceless, but that when there is an injury against one of us, then it is an injury against all. That when a single member of our class is cheated, robbed, or made feel small, that there is a unity that can vindicate them and open the path to a different society. The trade union movement can never be more than one stream in the river of holding power to account and demanding a total renegotiation, not just of employment and industrial relations, but the entire nature of power in a society where class domination has been accepted as the natural way of things.


 

Mícheál is an independent scholar from Cork, Ireland currently engaged in academic research on the work of Mikhail Suslov. Cristina Diamant is the current President of the Independent Workers' Union.


Support the Iceland workers' strike fund, organized by the IWU, here: https://gofund.me/a5282df1

 

Notes

[1] Editor's Note: The Oireachtas is the Parliament of Ireland [2] Editor's Note: The Dáil is the lower house of the Oireachtas.

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