The National Distribution Union says the move by a major North Otago employer to use the nine-day working fortnight scheme is saving jobs.
Summit Wool Spinners in Oamaru has announced that 45 of its 315 staff have taken voluntary redundancy and that negotiations on how to make use of the Government's new scheme are taking place.
The NDU's Paul Watson says Summit is looking to make use of the subsidy to reduce shifts from 10 to nine hours for a period of six months.
"It's a practical solution to a serious problem they have," Mr Watson says. "It's one in which we encourage where the circumstances are warranted."