A council worker sacked for allegedly making a racist remark has won his bid to be reinstated.

Labour-run Durham City Council's appeals panel, made up of councillors, granted the un-named man's appeal when it met in private earlier this week.

The man was dismissed by community services director David Marrs and lost his initial appeal. The alleged comment was made during an informal staff discussion about equality courses the council is running.

Derek Cattell, regional organiser for the GMB union, said: "He made some comment about the content of the courses, one of which he has done himself in a previous employment. "There was no evidence of a racist rant or any particular individual being abused. There was no-one in the room from a minority.

"Our member's argument is that it was taken out of context and misconstrued.''

Mr Cattell added that the sacking was substituted with a final warning and that the man was delighted to be reinstated.

"I'm not sure he's back at work yet but he's back on the pay roll again.''

Two years ago the council paid £6,500 to its former principal safety officer Mac Williams on the eve of an industrial tribunal hearing into his claims he had suffered repeated racist remarks from colleagues.

No employees were disciplined but the former deputy leader, Mildred Brown, alleged to have made one remark, resigned from the Labour Party ahead of a party recommendation to expel her.

The council denied liability and claimed it was determined to stamp out racism.

Mr Cattell said: "Our union supports the council's policy on raising awareness of racism at work and we have congratulated the council on it.''

He added: "We felt the council should act consistently bearing in mind the incident in the past.''

The council's public relations officer could not be reached for comment but has previously said the council does not talk about internal personnel matters.

One Labour councillor, who asked not to be named, said: "I think this will cause a stir in the party. I think David Marrs did the right thing in sacking him.''