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BAE Systems came under attack from its own staff at the defence group's annual meeting on Wednesday as employees criticised plans to cut 900 manufacturing jobs in Yorkshire.

BAE was accused of giving pay rises to "underperforming" executives while shutting its aircraft manufacturing site in Brough, with the loss of up to 900 jobs. Referring to salary increases for BAE's chief executive and finance director, one employee, Paul Bell, said: "You have not performed and you are getting pay rises. We are performing and you are sacking us." BAE has reported a 14% fall in 2011 revenues, to £19.2bn, due to reductions in UK and US defence spending.

BAE's chairman, Dick Olver, said the company had "looked carefully into our crystal ball" and could not justify keeping the Brough facility open in the wake of UK defence spending cuts.

Another employee, David Bird, who has been told his job is at risk, criticised Olver for thanking departing board members at the meeting. In an emotional statement, he said: "I notice that you gave thanks to the people stepping down from the board. Will you give thanks to me for my 21 years of service?"

BAE is not expected to confirm compulsory redundancies at Brough until next year and hopes to switch 100 staff to its sites in Lancashire. As well as the staff who attended the annual meeting, hundreds of BAE workers attended a rally next to the meeting in Westminster.

The head of BAE's UK business, Nigel Whitehead, said that a slowdown in the production of Typhoon jets and changes to the American F-35 fighter programme had left the company with too much factory capacity. As a consequence, a decision had been taken to end manufacturing at Brough, while preserving facilities at Warton and Samlesbury in Lancashire. "I was faced with the situation where my workload was suddenly reduced and I had about enough work for two factories, but had three factories. I came to the conclusion that the best thing to do would be to cease manufacturing at Brough," he said.

Whitehead added that maintaining manufacturing at Brough would impose "gross inefficiencies" on BAE that would threaten jobs among the company's 33,000-strong UK workforce.