German-owned Mc Neill Malta is to lay off 85 workers and close down at the end of April, the General Workers Union said.
The factory was set up in Malta 19 years ago and produces school bags.
The union said the company was considered as having excellent relations between the management and the workers and had won praise for its social responsibility, especially since it employed 15 persons with disability.
The GWU urged the Director of Labour to intervene so that the workers could be retrained so that they can find another job.