Cleveland Bridge could have to pay millions to its former employer at Wembley Stadium if it loses a contractual dispute.

The beleaguered company, which has had to lay off more than 300 workers this year, is challenging adjudication proceedings launched against it by Multiplex, the Australian firm in charge of the new Wembley build.

The proceedings have not been made public but industry insiders say Multiplex is demanding about £19m back from the Darlington firm, which won a £60m contract to build the stadium's arch and roof.

The Northern Echo understands that Multiplex claims it overpaid the amount to Cleveland Bridge for work done at the £757m stadium.

A judgement is likely to be made before the end of this month.

One industry source, who asked not to be named, said that if Cleveland Bridge lost the case it "could find itself in real difficulty" .

The firm stopped all work on the Wembley project in August and issued a counter-claim against Multiplex in the Court of Technology and Construction, a division of the High Court in London, also for millions of pounds.

A Cleveland Bridge spokeswoman said the two companies signed a supplemental agreement after Cleveland Bridge realised it needed more money than had originally been agreed to complete its work at Wembley.

The firm claims the extra costs were incurred because of delays caused by Multiplex.

" We believe that we were sticking to the letter of the supplemental agreement which would see Multiplex owing Cleveland Bridge money and not vice versa," said the spokeswoman

" It\rquote s because we find ourselves in this extraordinary situation that we went to the High Court and launched a writ. We had no choice but to stop work."

A Multiplex spokesman said: " Adjudication proceedings are normally kept private.

" If you have a disagreement on price or the cost then you simply bring in an independent arbitrator. We can't go into specifics."

Union officials said last night that redundancy notices would be issued to another 95 workers at the Yarm Road plant this week and next.

Gerry Hunter, from the Amicus union, said: " They haven't got enough work."

Former Cleveland Bridge workers in London have been staging an official picket at the Wembley site.

They were sacked last week by Hollandia, the Dutch firm brought in by Multiplex to finish the stadium's roof.