A UNION is planning to take legal action against two councils after the transfer of a bus company into private ownership saw workers get "inferior" pensions.

Blackburn with Darwen Council sold Blackburn Transport to Yorkshire-based Blazefield Holdings, an arm of French operator Transdev, on Monday.

The Transport and General Workers Union (TGWU), which represents workers at the company, is unhappy that 16 staff have had to take up a pension with Blazefield instead of continuing their Local Government Pension Scheme (LGPS), administered by Lancashire County Council.

Bosses of the TGWU said that workers had lost out in the move because the LGPS pension has better terms.

They believe workers should have been allowed to stay in the LGPS.

The union is now seeking legal advice about whether it can sue both Blackburn with Darwen Borough Council and Lancashire County Council for compensation.

However a boss at the borough council said they had done all they could to try and keep the staff on the LGPS scheme.

Jim Casey, union rep for the TGWU, said: "We feel there is a case of maladministration.

"If they have not done things correctly we may be able to claim compensation."

Blackburn MP and leader of the House of Commons, Jack Straw, has intervened in the matter and written to the chief executive of Blackburn with Darwen Council, Graham Burgess.

In a letter obtained by the Telegraph, he wrote: "The members feel that they have been unfairly treated and believe that Blackburn with Darwen Council could have acted sooner and may have failed in their duty to complete the arrangement of transfer pension for these 16 individuals before the transfer of assets went through.

"I would be most grateful if you could look at this situation again, particularly since there may have been incorrect legal advice which clearly would leave LCC open to a charge of maladministration."

Alan Cotton, strategic director for resources at the council, said: "The council has done all that it can to work with the scheme administrators to see if these employees can remain on the scheme, but based on advice from the actuaries it has not been possible."