More than 80 contractors will be laid off from the Hunter Valley Operations open cut mine due to an ongoing downturn in the coal industry.
A new mine plan to be implemented from January requires fewer mining, coal preparation and maintenance workers.
The mine is operated in a joint venture between Yancoal and Glencore.
"Hunter Valley Operations has initiated discussions with the mine's workforce on changes that will be made to the mine's coal processing requirements from January 2021 as a result of ongoing economic and energy demand impacts arising from the COVID-19 pandemic," a statement from the mine said.
"The changes will not impact HVO's permanent workforce numbers but some contracting roles in the mining, coal preparation and maintenance areas will not be required under the revised production plan."