Thousands of people on the West Coast will be affected by Solid Energy's decision to mothball Spring Creek mine with the loss of more than 200 jobs, Labour says.
About 235 workers at the mine were told on Thursday they were being made redundant as the company cuts back its operations, blaming weak coal prices.
Labour's West Coast-Tasman MP Damien O'Connor says it's a grim pre-Christmas blow for the community.
"The tragedy is that not only does this directly affect the miners and their families but thousands of others on the coast who relied on the mine and its workers for their livelihoods as well," he said.
"Just four weeks ago Solid Energy was saying it was looking for potential partners for Spring Creek and its financial success was `an absolute priority' for the Government - what a joke."
Mr O'Connor says the miners have been "played for suckers" as the Government prepares Solid Energy for sale.
The workers will be able to apply for about 16 jobs that will be retained to keep the mine under care and maintenance.
Another four can apply for jobs at the nearby Rocky Creek handling and processing plant in case the mine is reopened.
"Solid Energy believes the mine still has potential if or when international markets strengthen for steel-grade coal," Solid Energy's chief executive Don Elder said.
The company announced last month it was cutting its workforce by 25 percent, from 1800 to about 1360.
Sixty jobs are going at its Huntly East mine and 163 at its Christchurch head office.