East Lindsey District Council has received the all-clear after giving a bumper pay-off to a former director who was made redundant.
The District Auditor and several ELDC councillors raised concerns at the £80,000 awarded to Jane Froggatt when she lost her job 18 months ago.
It emerged that ELDC had no formal procedures for so-called “compromise agreements” in place.
The compensation figure was decided by former ELDC chief executive Nigel Howells after consultations with the authority’s human resources department.
Following an inquiry, a report ruled the pay-off was “reasonable” - not least because it saved the council any potential costs and risks regarding its reputation in the event of having to defend a legal challenge - if Ms Froggatt had taken the matter to a tribunal..
The same report has recommended ELDC should draw up a written framework which ‘clearly sets out the basis and criteria’ in the event of needing to reach any similar compromise agreement in the future.
In a completely separate development, the council has confirmed Mr Howells has retired.
He had been on ‘sick leave’ since last April.
In a statement, ELDC says Mr Howells has been advised by his consultant that he will not be well enough to return to work and has therefore retired on ill-health grounds.
Leader of the Council, Councillor Doreen Stephenson, said: “On behalf of the council, I thank Nigel for his hard work and dedication.
“Nigel has worked tirelessly to improve the council’s services to local people and for this we are grateful. I would like to wish Nigel well for the future.”
The Council will consider the Chief Executive’s position over the next few months.
Mr Howells joined ELDC in 2005.