Up to 10 staff working at the Launceston Reception Prison may have been exposed to deadly asbestos.
Unions say staff were potentially exposed when dust from refurbishment work fell onto the desks where two nurses were working.
Community and Public Sector Union secretary Tom Lynch said the asbestos register for the prison noted there was asbestos in the floor and wall tiles and the register was made available to the successful tenderer.
He said despite this knowledge, staff were exposed when materials were removed last month.
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"Our members are concerned that their health may have been affected by this exposure and angry that sufficient safeguards were not put in place to protect them," Mr Lynch said.
"It's bad enough they are being expected to work in a construction site at a time when the whole prison system is buckling under the pressure of record prisoner numbers, but to now have the ticking time bomb of a potential asbestos exposure it totally unacceptable."
Mr Lynch said he also believed that additional asbestos was found that was not included on the site register.
He said 10 staff working at the reception prison were told they could be placed on the National Asbestos Exposure Register and have x-rays.
Australian Nursing and Midwifery Federation executive director Andrew Brakey also expressed concern at the potential asbestos exposure.
"It is very worrying," Mr Brakey said. "We know that exposure doesn't always lead to problems or mesothelioma, but workers could get sick 30 years down the track.
"We need to get them on the exposure register so they have recourse in the future."
A Department of Justice spokesman said when the asbestos was discovered works were "halted immediately" and the area fully sealed and contained.
"Worksafe Tasmania were notified and the Department has engaged a licenced asbestos removalist to remove the asbestos, conduct air monitoring and complete a full asbestos inspection of stage two area of works," he said.
"Construction works will not restart until Worksafe Tasmania approval is received and air monitoring will continue for the duration of the stage one and stage two works and for a reasonable period post-completion.
"All affected staff and stakeholders are being kept fully informed of the asbestos removal and air monitoring processes."
The spokesman said it was not unusual to find asbestos in a building as old as the prison.
The government is spending about $1 million at the prison to deliver on its commitment to remove police out of courts and provide improved staff amenities.