Luas operator Transdev has placed all staff on protective notice, in letter was circulated to workers this evening.

The union SIPTU says the move means staff can be laid off at a day's notice.

It's now considering ballotting for an all out strike.

Transdev says in the letter that it may make deductions from the pay of drivers and supervisors.

SIPTU says the company has offered drivers a pay rise that is lower than the one agreed at the Workplace Relations Commission, and rejected by staff.

Owen Reidy of SIPTU says the company's action makes the possibility of reaching a negotiated settlement more remote: