BLACKBURN with Darwen Council has borrowed £3.6million to ward off legal action by its staff over equal pay claims.

The agreement will allow the council to settle claims by underpaid workers - averting the threat of legal action by trade unions on behalf of the staff, most of whom are women.

The council has been loaned the cash from the Government which is part of a total pot of £500m lent to 46 councils across the country.

It means women who for years were paid less than men for years get one-off back payments of up to £7,500 as compensation.

Workers who will get the cash include dinner ladies, cleaners, care workers and home helps.

The offers form part of an agreement brokered in 1997 between councils and trade unions designed to ensure staff receive equal pay for work of equal value.

No win no fee' law firms had been contacting staff offering to help them claim back thousands under the 1997 agreement.

As revealed earlier this year, Blackburn with Darwen Borough Council predicted that he claims would cost it £4million, while Lancashire County County set aside £9million of its own cash.

Denise Park, director of finance at Blackburn with Darwen, said: "Equal pay compensation has been paid to staff who may have a case under equal pay legislation.

"At Blackburn with Darwen this amounts to around £3.6m. The Government has given the council permission to capitalise this money.

"This means the council can borrow money and pay it back over a number of years rather than having to pay it all at once from its annual budget."

Council chiefs are also drawing up new pay scales to ensure all staff are on the same footing in the future.

The new scale, set to be completed before the end of the year, will see some workers' wages go up while others' will decrease.

The move was welcomed by Blackburn with Darwen Unison branch secretary Sue Crompton.

She said: "We want everyone to get the same grade. It will increase the wage bill, so it's not a cost-saving exercise. It's very important, and will make things fair."

Meanwhile, Lancashire County Council is still in the process of offering its staff compensation. If they do not accept the offer it could face legal action.

A spokesman said the council did not intend to apply for Government funding to settle the claims.