SHOPWORKERS union Usdaw has won compensation worth up to £1.5m for more than 500 employees of Ethel Austin who lost their jobs when the firm collapsed last year.

It is now considering an appeal in a bid to win pay-outs for another 1,200 workers who were made redundant in February 2010 when the company went into administration.

Yesterday, Usdaw said an employment tribunal in Liverpool found administrator MCR had failed in its legal obligations to consult with Usdaw before making 1,700 redundancies.

Its eligible members were awarded compensation of eight weeks’ pay, capped at £380 a week.

But the compensation is limited to those employees made redundant from Ethel Austin’s former head office and distribution centre in Knowsley and the company’s store in Edgware, London.

The tribunal ruled MCR was not obliged to consult about workplaces where less than 20 redundancies were being made, thus ruling out all bar one of the 186 Ethel Austin stores which were closed. The union said it may appeal against that judgment.

John Gorle, Usdaw’s national officer, said: “While the award can never fully compensate for staff losing their jobs, I am sure our members will welcome the money and appreciate the effort Usdaw has made to secure this compensation for them.

“However, I am bitterly disappointed the tribunal limited the scope of the award. The fact that many of our members will not be compensated just because their store had less than 20 staff is plainly wrong and shows the gaping loophole and injustice of the current legislation.

“About 1,700 employees were made redundant from the same company for the same reason so to suggest only 500 of them constituted a collective redundancy is nonsense.