The government has agreed to fund a one-off bonus for health workers who missed out previously because they worked for non-NHS organisations.

A payment of at least £1,655 was agreed as part of the NHS pay deal in England this year, to recognise the pressure of the Covid pandemic on staff.

But the BBC recently reported thousands of outsourced staff did not qualify and employers had launched legal action.

Their employers can now apply for funding to cover the payments.

It is estimated that up to 20,000 staff, including community nurses and physiotherapists, could benefit, but one health union has warned there are other staff on different contracts who still won’t qualify.

Healthcare staff working for some charities, local authorities and social enterprises that provide services for the health service had been told they would not get the one-off payment of between £1,655 and £3,789, as they did not work directly for the NHS.

Social Enterprise UK, an industry body which represents 10,000 such workers, had described the decision as “an injustice” and threatened to take legal action against the government.

But the government has now announced it has “stepped in” to help independent healthcare organisations to give the bonus.

“This will ensure hardworking healthcare staff and the organisations they work for are not financially disadvantaged as a result of the NHS pay deal, and means they will receive their backlog bonus for their efforts during the pandemic,” said Health Minister Will Quince.

He added that the additional funding would be provided “on this occasion” given the difficult economic context.

Peter Holbrook, chief executive of Social Enterprise UK, said: “We’re pleased to see the government acknowledge the critical role of social enterprises in the NHS family, with tens of thousands of staff delivering vital care across the country and services reinvesting profits to help local communities,” he said.

Social Enterprise UK previously told the BBC it had started the process of applying for a judicial review, as it believed the arrangement was “completely unfair”.

The decision to fund the bonus will only apply to non-NHS organisations. Some “bank” staff – who provide temporary cover for hospital trusts to fill rota gaps – have lobbied to be included in the scheme will not receive the payment.

Patricia Marquis, of the Royal College of Nursing, welcomed the announcement but added there was more work to be done.

“Unfortunately there are some nursing staff delivering NHS care who will not get this… The department must provide clarity on who will receive the funding.”

She said nursing staff working in general practice should be given the full pay uplift funded by central government.

Unite’s general secretary Sharon Graham added: “This is barely a sticking plaster from a government that has defunded the NHS to the point it is now on life support.

“Instead of doing the right thing and funding a lump sum payment for everyone who works in the NHS, it has instead created a multi-tier workforce.”

The lump-sum award was announced earlier this year as part of a deal which included a 5% pay rise for more than a million NHS staff in England.

Separate pay deals were made for staff working in the NHS in Wales and Scotland.