The Australian government said on Friday it will take back money given to clothing manufacturer Pacific Brands if moves its operations to China.
The Australian company announced this week it is to close New Zealand factories at Palmerston North and Christchurch, with the loss of 98 jobs.
The company says it is no longer economically viable to manufacture socks in Christchurch and thermal wear in Palmerston North.
Last week, Pacific Brands announced it would sack more than 1850 workers in Australia and set up production in China, despite receiving about $A17 million of government assistance in the past two years.
Australian Prime Minister Kevin Rudd said the government would reclaim money granted for research and development if the company moves operations to China.
"I think what Pacific Brands has done is frankly in so many respects beyond the pale," he said.
"In terms of the monies they've got from the Government, we'll go through all of that in terms of what can be extracted back from them."
Mr Rudd also criticised the company for awarding millions of dollars worth of pay rises to top executives, including chief executive Sue Morphett, whose salary rose from about $A680,000 to more than $A1.8 million.
The ABC reports the company has awarded millions of dollars worth of pay rises to its top executives.
Workers walk off job, protests held
Pacific Brands workers have walked off the job in western Sydney on Friday to join a stop-work meeting over the company's plan to sack staff.
About 80 people protested outside the Pacific Brands factory in Wentworthville on Friday, where 500 jobs will be axed, the ABC website reports.
The rally was staged by seven unions, who have declared a ban on shipping equipment from the clothing factories to move manufacturing overseas.
The protest was held after hundreds of sacked workers rallied in Melbourne on Thursday and unions called for a boycott on Pacific Brands products.