In 2003 staff voted for job losses and a pay cut to save the plant

Administrators called in to South Shields-based circuit board maker Circatex, said 350 of its 520 workforce were to lose their jobs.

It follows a cash crisis at the company, which received �3m in taxpayers' money to fund a management buy-out in 2001.

Now the Amicus union has launched claims for unfair dismissal.

The union says it has also launched protective award claims for lack of consultation against the administrators of the factory.

On Monday, Ian Kings and Simon Thomas, directors of Tenon Recovery, were appointed joint administrators.

They were brought in after company bosses revealed a severe cash flow crisis prompted by a slump in orders and tough foreign competition.

On Tuesday afternoon, 350 job losses were announced, leaving around 180 staff at the site.

In a statement, Mel Barras, Amicus regional officer, said: "Amicus are disgusted at the way these redundancies have been handled.

Mr Miliband has promised government support

"We are looking to the government to alter laws that allow administrators to make redundancies without the normal consultation periods.

"These job losses are yet another example of the crises facing manufacturing in this country due to laws that offer UK workers lower levels of protection than in the rest of Europe."

The union is planning a demonstration in Newcastle on 2 April to highlight the decline of manufacturing and to call for the introduction of stronger employment protection to make redundancies a more difficult and expensive option.

Union officials are also due to meet South Shields MP David Miliband to ask what help the government can offer.

Last year, 37 jobs were lost at the plant after workers voted for a 10% pay cut and job losses in order to keep the struggling plant open.

'No alternative'

Earlier on Tuesday, Mr Miliband pledged the government would "step in" if required.

He said: "What I can completely pledge... is not only that I will be working closely with the trade unions and meeting them on Friday to talk about what's happening.

"But obviously if there is anything that can be done, the government will be stepping in to do it."

Ian Kings of Tenon Recovery, said: "In recent months the company has been working with its creditors to try and find a solution to its problems.

"However, the expected level of future orders has not been achieved and consequently the directors feel that they are left with no alternative but to seek the protection afforded by an administration order.

"As administrators it is our intention to continue to trade the business with a view to obtaining a sale as a going concern and obtaining the best realisation for creditors and a continuation of employment for employees."

Circatex was given a �3.75m grant to aid a management buy-out in 2001, when previous owners Viasystems decided to close the plant and a sister factory in North Tyneside.