Hundreds of people were made jobless yesterday as a quake-ravaged Christchurch company closed its doors.

Two hundred and twenty workers from Canterbury Spinners, a subsidiary of carpet manufacturer Godfrey Hirst, were gathered together and told their plant had suffered irreparable damage in last month's quake, forcing its closure.

Counsellors, staff from Work and Income New Zealand and the Inland Revenue Department, and representatives from temping agencies attended the meeting, where workers were offered a choice of a redundancy payout or transfer to other Godfrey Hirst plants.

Chris Luke, who has worked for Canterbury Spinners for four years, was planning on transferring to the company's Wellington plant.

"It's a bit sad really," he said.

"I've met a lot of good people here."

He said there had been a number of meetings since the quake for both union and non-union staff members, keeping them up to date with what was happening at the plant.

Yesterday's news was no surprise, and Mr Luke said there was no outcry when the announcement was made.

"It's a good package. Everyone was happy, both those in the union and those on individual contracts."

The National Distribution Union, which represents many of the workers, said that although there were satisfactory union-negotiated redundancy provisions, the announcement came as a heavy blow for workers already reeling from the effects of the earthquake.

NDU Southern Region Secretary Paul Watson said: "Not only has the plant been destroyed within a few seconds by a devastating earthquake but the future incomes and job security of 220 people have also been devastated.

"The NDU has negotiated a satisfactory redundancy and relocation agreement which has been endorsed by union members. It is superior to the redundancy agreement that would have [normally] applied."

Mr Watson said the NDU would immediately establish a redundant workers support network.

"Many of these workers live on the devastated east side of the city where the factory is based. The future of many of their homes is uncertain and now they have to face worrying times in terms of finding alternative work that can meet their living costs.

"The Government needs to provide more support to assist these workers. Canterbury Spinners workers appear not to qualify for any earthquake job loss cover and that is unfair."

But Social Development Minister Paula Bennett said the textile workers might not fit into the Government's support package for earthquake-affected workers.

"We need to look at what the benefit system can do for them, and so we're looking at other options."

She would not be drawn on whether the scheme could be widened to include workers hired by offshore companies, but Prime Minister John Key said workers might be eligible for the package because it worked on a case-by-base basis.

- Additional reporting Derek Cheng and NZPA