The axe is set to fall on about a quarter of the workforce at Sheppey’s biggest employer.

Up to 80 jobs are to go at Sheerness Steel Mill, which is owned by Thamesteel.

A formal statement from the mill, which employs around 400 people, is expected later this week.

Tom Butler, chairman of the union Community which represents 95 per cent of the workers, said: “This is a great shock to the workforce as we only told them last Thursday their jobs were safe but not to overspend at Christmas.”

Keith Plowman , the mill’s general sales and marketing manager, said: "I would rather make no formal comment until later this week except to say that we are in discussion with staff and the unions."

A spokesman from the union’s head office in London, said: "We have met with members to discuss the current situation at Thamesteel.

"The Community union will do everything in its power through negotiation to work with the company to save jobs where they can be saved and to help those affected through this difficult time."

Meanwhile, a formal statement on job losses at the Port of Sheerness, across Brielle Way from the mill, is expected on Thursday.

We reported last month consultation was taking place with at least 20 employees of owners Peel Ports. Again, the losses were due to be across the company from management to those on the quayside.