A Connemara manufacturing plant has threatened to close if its 80 employees do not accept rationalisation under its terms. Mr Ralph Fechhelm, managing director of Maysteel Teo in Inverin, Co Galway, sent a letter to staff warning all jobs will go if staff do not reject their union's advice on the rationalisation programme.

The US firm, based in Wisconsin, makes precision casings for the information technology and telecoms sector, but wants 18 redundancies after a slowdown in business. Late last year, it said it would close its plant in Mayville, Wisconsin.

Maysteel notified the Connemara staff last July that the parent company could no longer subsidise the Inverin plant, and the 18 redundancies were then sought. But there was no agreement on a redundancy package after several meetings between the firm and representatives of the Associated Transport and General Workers' Union (ATGWU).

Talks convened last week at the Labour Relations Commission broke down and the matter may now be referred to a full hearing of the Labour Court. Mr Frank Maunsell, ATGWU, described as "outrageous" the tone of the managing director's letter.