Herdman Mills have announced 85 job losses with the closure of its plant at Ballybofey, Co Donegal.
Another 85 jobs will be lost in the company’s factory in Sion Mills, Co Tyrone, with the ending of weekend working.
International trading conditions for the flax spinners - flax spinning has been done in Co Tyrone since 1835 - are being blamed.
Mr Jimmy Quinn of the Transport and General Workers Union said the job losses were a blow but not totally unexpected.
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He said: "It is a shock. People had an idea that things were not good, but they didn't expect it to be as bad as total closure in Co Donegal.
"We certainly didn't expect there was going to be a knock-on effect at Sion Mills."
PA