A group of 247 dinner ladies who lost their jobs when a council scrapped hot school meals are fighting to win redundancy money.

An employment tribunal to decide who is liable for the payments, an estimated £300,000, started in Brighton yesterday.

The outcome of the case could have far-reaching implications on who pays redundancy money as councils across the country award contracts to private companies.

West Sussex County Council, caterers Sodexho (formerly Gardner Merchant), and Castle View Services all deny they are responsible.

The tribunal heard Castle View Services employees, who provided hot school meals at primary schools in West Sussex, received letters from the company last year giving them 12 weeks notice.

It came after the county council decided to scrap hot meals and awarded a contract to Gardner Merchant to provide cold lunch boxes.

Who should pay the dismissed dinner ladies hinges on whether the lunch service was transferred from Castle View to Gardner Merchant, making the new company liable, the tribunal heard.

The council claims Castle View should pay because they employed the staff and dismissed them and the lunch boxes are a completely new service.

A total of 500 employees lost their jobs and they could all claim redundancy money.

There were legal arguments over whether all or some of the 247 dinner ladies, who are represented by various unions, should be asked to give evidence.

Sodexho and the county council are represented by the same legal team, which could mean the tax-payer will have to pay costs if they lose.