Fifty workers at waste processing firm Brickkiln Waste Limited are to lose their jobs.
Staff were told at a meeting on Friday 24th July that the company had gone into administration.
The firm, which is based at Heather Road, recently had its licence temporarily suspended by the Northern Ireland Environment Agency.
This was because of breaches at its waste site in Maydown.
It is also understood that the company has been involved in a dispute with Derry City and Strabane District Council over payment for contracts.
A spokesperson for Derry City and Strabane District Council said, “Following the NIEA’s suspension of the company’s waste acceptance services on July 10, Council has been working closely with Brickkiln, the NIEA and other Councils to assist in resolving ongoing waste processing issues.
“Prior to this cessation of service council was forced to suspend payment to the company as Brickkiln had failed to fulfil contractual obligations as set down in contract specification. Where invoices have been received by Council demonstrating that the company has met their agreed terms, these invoices have been paid in full.
“Council is legally obliged to adhere to all legislation in terms of the appropriate management of waste and is committed to working with the Company the NIEA and other Councils to resolve the matter.”
Earlier this month on July 7, up to ten appliances and 50 firefighters tackled a blaze at the Heather Road site.