The Labour Party has accused management at Dairygold Co-Operative of adopting a "Scrooge" mentality by announcing job cuts in the run-up to Christmas.
Employees at the company were told yesterday that 500 redundancies were being sought before the end of the year.
The company, which has its headquarters in Mitchelstown, Co Cork, has given staff until Monday to apply for voluntary redundancy. If enough applications are not received the company will seek involuntary redundancies on December 17th.
Labour Party deputy for Cork East, Mr Joe Sherlock, said the news was a "devastating blow".
"There is a real fear among workers that the Scrooge mentality being adopted by the management at Dairygold Co-Operative is a precursor to the privatisation of the company. This must be opposed at all levels," Mr Sherlock said.
"It is now time for the Tánaiste to deliver an early but welcome Christmas gift to the Dairygold employees by intervening with negotiations to save as many jobs as possible," he added.
Management at the company said the job losses were "absolutely essential for Dairygold's survival".