New Zealand Post says it needs to make redundancies so the business can stay competitive in a tight market.
The company announced on Thursday it is axing 100 workers in Wellington and Auckland, saying the job losses are the result of an upgrade of its printing systems.
It says there will be 70 layoffs at its bulk business operation Datamail at Petone, near Wellington, and 30 in Auckland. However, 30 new jobs will be created at its Christchurch plant.
Spokesperson John Tulloch said on Thursday the decision has been driven by new technology which can do more work with fewer workers.
"Look, it's never easy. First and foremost, we've tried to inform our people as soon as we practically could.
"This is very much a specific scenario relating to business mail printing production and we had to invest in new technology or we would have lost out to our competitors."
Mr Tulloch says New Zealand Post is working to relocate workers where possible.
The Engineering, Printing and Manufacturing Union represents postal workers and believes those who have lost their jobs will struggle to find new employment.
Postal sector co-ordinator Joe Gallagher says the EPMU doesn't blame New Zealand Post for the layoffs because the upgrade to printers is necessary for the business.
However, Mr Gallagher told Radio New Zealand's Checkpoint programme the cuts come at a bad time because the job market in Wellington and Auckland is very constricted.