More than 50 employees at Lane Walker Rudkin in Christchurch have been told they will be made redundant by Christmas.
The National Distribution Union says staff were told on Friday that the clothing company's Christchurch manufacturing division will close by 22 December.
Lane Walke Rudkin (LWR) has made 228 employees redundant since it went into receivership in April, owing debts of $121 million.
Union redundancy support coordinator Jack Taylor says between 50 and 60 of the 87 staff still employed at LWR in Christchurch work in the manufacturing division and many of them had been expecting Friday's announcement for some time.
Mr Taylor says it is the last nail in the coffin of LWR and could have been avoided.
He says while the collapse may not be a surprise, it is still a disaster and he puts it down to mismanagement rather than the effects of the recession.
Debbie Trotter has worked at the manufacturing plant for 15 years and says the latest announcement was almost a relief.
She says the workers can now get on with their lives and start looking for new jobs after Christmas.