DOZENS of ex-Woolworths and Ethel Austin workers in East Lancashire are facing heartbreak after being told that they are not entitled to compensation payouts following the demise of the former high street giants.

Top European judges rejected a claim by the shopworkers union USDAW regarding the redundancy rights for around 4,400 of the now-defunct chains, who worked for smaller stores of less than 20 employees.

The legal action would have potentially benefitted workers at former branches of Woolworths in Nelson, Clitheroe and Rawtenstall, and Ethel Austin in Darwen, Rawtenstall, Nelson and Colne.

Under UK law, when the two chains went under in 2008 and 2010, there was no obligation to consult over redundancies, meaning they missed out on compensation payments which would have been available to larger outlets in Blackburn, Burnley and Accrington.

But a European Court of Justice ruling, upholding the government’s approach, has dashed the hopes of workers.

John Hannett, USDAW general secretary, said: “This decision marks the end of the road for our members from Woolworths and Ethel Austin seeking justice and they are heartbroken.

“Our case is morally and logically robust, so the decision is a kick in the teeth. It is unfair and makes no sense that workers in stores of less than 20 employees were denied compensation.

“These were mass redundancy situations where one decision was made to close the whole company down.”

Union bosses have questioned why government ministers ‘sided’ with administrators against low-paid workers.

Mr Hannett added: “We can only pin our hopes on the election of a Labour government to prevent this happening again to other workers.”

Tens of millions of pounds was secured in compensation for 25,000 ex-Woolworths and Ethel Austin staff by the union in 2012.

But the bosses’ union – the CBI – has welcomed the announcement.

Katja Hall, the CBI’s deputy director general, said: “This is a victory for common sense and will be welcomed by firms across the UK .”