A TRADE union last night claimed a victory after securing a payout worth up to £1.2m for 560 workers of collapsed company Stag Furniture.

Workers at Stag, in Sunderland, were laid off after the firm went into administration earlier this year, without informing unions.

On Thursday, an employment tribunal ruled that directors at Stag broke employment laws by failing to give 90 days' notice to workers, and failing to consult with unions over job losses.

Because Stag has collapsed, the Government will foot the bill for the payout, which amounts to eight weeks' wages for each worker.

The maximum the workers were paid was £290 a week, so the total bill is likely to be up to £1.2m.

Micky Hopper, of the GMB trade union, which brought the action against Stag, said: "Because they have gone into administration, we can't get any money from the company, so we will apply to the Government to make the payment.

"They have already had the minimum redundancy payment from the Government, but this is compensation because the company failed to consult."

Stag went into administration in February last year, blaming a downturn in consumer spending, and shut a month later.