Oamaru-based Summit Wool Spinners, North Otago's second largest employer, has reached a new agreement with workers which their union says could help save jobs.
The company has shed 50 jobs this year and has called for up to 30 voluntary redundancies.
It is also pledging an eight-day paid holiday for all its workers, to create a backlog of work for the 200 employees.
Summit Wool Spinners has already signed up to the Government's 9-day fortnight scheme which it says has saved jobs.
The National Distribution Union says the latest agreement is responsible, as the company could have taken the traditional corporate approach and simply axed jobs.