As workers at the Calcast factory near Londonderry enter their second day of a sit-in protest, demand today mounted for the government to intervene in the dispute.

The workforce at the doomed Campsie plant maintained the sit-in overnight after starting it yesterday amid union claims they were to be short-changed.

Management at the company, which is a subsidiary of Paris headquartered Montupet, said around 90 workers would be made redundant, with the remaining 12 offered work elsewhere — Montupet has a plant at Dunmurry outside Belfast.

Unions said limiting the number of those being paid off to below 99 meant those going will only get a one-month notice payment, compared to the three-month payment they would get if more than 99 went.

The SDLP in Derry has called on the relevant government department and agencies to do all they can to save the factory workers’ jobs.

The workers were told that the factory is set to close — although no final date has yet been given.

Local representatives said this figure of 90 is the crux of the matter. If a company has less than 99 employees, it need only give one month's statutory notice.

The company has said it will redeploy 12 of the workers. However, Unite — the union most of the workers are with — is arguing that the jobs are not sustainable.

They argue that by not making the full complement of factory workers — 102 — redundant, Calcast can avoid paying the workers three months’ notice.

It is thought this move will save the company about £200,000 or approximately £2,000 per worker.

Philip Oakes, of the Unite union, said: “As far as we’re concerned that is them manipulating the figures in order to save around £200,000. The employees and the trade union members decided that it would be better for them to remain on site.”

He added: “ Their view is that if they leave at this stage, the company might close the gates behind them and not let them back in. Individual members have decided to stage a sit-in at the plant until such time as the issue is resolved.”

The company – which makes cylinder heads for the Ford Explorer 4X4 — blamed the factory closure on “current market difficulties” and cited the “reduction in customer demand” from the Ford engine plant in Cologne, who completely stopped production on October 21 through to January 5, 2009.

Foyle MP and SDLP leader Mark Durkan said: “This is extremely disappointing news and the timing is particularly distressing.

“People face huge uncertainty in their lives, and coming up to Christmas and coming as we face a very serious recession, it's a terrible time for so many families and the local economy to be hearing of these job losses.

“Everyone will now rightly expect the relevant powers and agencies to do everything in their power to secure work in the North West for the skilled and dedicated staff of Calcast.”

Speaking after visiting the workers last night, a spokesman for the Socialist Workers Party in Derry said: “The workers justly believe that the announcement of 90 redundancies is a cynical attempt by Montupet to avoid paying them for the 90 days notice period.”