NORTH BRUNSWICK, N.J. (AP) _ Workers suspended for wearing Santa Claus hats on the job sang ''Jingle Bells'' at a protest rally Monday, and their unbending employer suspended 100 other employees when they, too, donned the Christmas headgear.

The Okonite Co., a manufacturer of electrical cable, said in a statement that the holiday caps were ''not appropriate for a business environment'' and threatened to fire employees who continued to wear the red hats with white trim.

The workers said the company may have suspended the first 23 workers last week to set the stage for upcoming contract negotiations with Local 1992 of the International Brotherhood of Electrical Workers. There has been no indication of labor strife or major issues that might come up at the bargaining table.

Workers said the company has no regulation against wearing hats on the job, and that most of them wear baseball caps without incident.

''I wear a hat the whole year in here, and this is the only hat I'm suspended for,'' said Ed Reilly, who works in the shipping department.

Workers suspended last week for wearing the hats gathered with signs that said ''Welcome Okonite, Humbug'' and ''IBEW Local 1992 Supports Santa'' in front of the sprawling central New Jersey plant.

One employee dressed up as Santa Claus, and another brought an inflatable Santa to the demonstration.

On Monday, the entire first shift of about 80 workers showed their support for their suspended colleagues by wearing similar red caps with white trim, the union said.

The company responded by suspending all of them, said Lenny Zabiegalski, president of IBEW Local 1992. They then joined the protest rally.

Later, when 20 workers on the second shift showed up wearing similar hats, the company suspended them too, the union said. The union represents about 230 workers at the plant.

Robert Wiget, a testing department worker whose indefinite suspension on Thursday began the hat flap, said he has worn a Santa hat during the holidays for the last five years without a problem.

''I think it's a lot of hogwash. Christmas is very important to these guys,'' said Wiget as he stood among the demonstrators outside the plant.

A second worker was suspended Thursday, then a third Friday, and about 20 employees showed up at work Saturday wearing Santa hats. All of them were suspended for times ranging from two to three days.

Thomas Scanlon, vice president of employee relations of Okonite, said in a statement that the workers were suspended for ''refusal to follow a reasonable directive of their supervisors.''

The statement said the suspensions came after senior executives visited the plant in this central New Jersey community and saw the hats, which were described by the firm as ''carnival-like headwear.''

Scanlon and other company officials refused to comment beyond the statement, which was read to reporters by a secretary who refused to give her name.

Workers questioned why the hats were deemed inappropriate.

''They were embarrassed by the hats. They said it was unprofessional. I don't understand it,'' said Frank Puskas, a suspended worker from the shipping department.

The suspension letter given to employees said that ''further instances of refusal to follow reasonable orders and-or inappropriate dress apparel will subject you to further disciplinary action up to and including discharge.''

Zabiegalski said he was not sure what the union's next step would be, but most workers said they would return when their suspensions ended.

''The company's saying they'll close down the plant over this. It doesn't make any sense,'' Zabiegalski said.