Nearly 1,000 holidaymakers are to receive a share of £2.5 million in compensation from Thomson and Thomas Cook after falling ill at a Spanish hotel.

The tourists contracted the Norovirus stomach bug at the Beach Club Hotel in Torremolinos between 2000 and 2002. Some developed long-term conditions such as irritable bowel syndrome as a result.

Other guests caught salmonella and bacterial disease campylobacter at the hotel.

Law firm Irwin Mitchell, which negotiated the claim, said guests reported their concerns to “unhelpful” tour reps and at one point so many were ill that the hotel descended into chaos.

The package, approved by His Honour Judge Alistair MacDuff at the High Court in Birmingham, is the largest award for group action in the UK.

Five other tour operators settled more than 200 claims out of court several years ago. However, Thomson and Thomas Cook continued to deny liability until days before the trial was due to start in London.

The £2.5 million package being paid to 790 tourists was funded by the two operators and the hotel owners.

A Thomson spokeswoman said the case was settled at a “much reduced amount” than originally claimed. Thomas Cook declined to comment.

Clive Garner, head of Irwin Mitchell’s travel law team, said the firm used medical and other experts to support its clients’ claims.

He said: “Some of our clients still suffer illness today and will be left with permanent health problems. While we are delighted with the result, many of our clients questioned why Thomson and Thomas Cook did not agree to pay compensation earlier, avoiding the need for legal action.”

The Beach Club Hotel in Torremolinos remains bookable on the Thomson website, but Thomas Cook no longer features the property.