The figure represents a third of the 1,200-strong HQ staff. Consultation is expected to be complete by June.
Iceland chief executive Malcolm Walker lamented: 'I sincerely regret that the financial situation we have inherited means that we will only be able to offer those employees facing redundancy the statutory minimum payments. This makes a sorry contrast with the substantial severance packages received under their contracts by the former management, who are responsible for the current state of affairs.'
He said since his departure four years ago there has been a 'huge increase' in the number of people at head office and a corresponding increase in overheads of£40 million.
Walker said: 'This reflects the massive growth of complexity and bureaucracy throughout the business under the previous management team. Far from delivering results, this has produced a situation in which our annual turnover is now some£400 million lower than it was in 2000, like-for-like sales are currently down 10 per cent, and the business will record a loss for the financial year to March 2005.'