The Royal London Society for the Blind has paid £160,000 to a former manager who alleged there was a climate of bullying and fear at the charity.
The payout to Tebiena Martin was made two years after the charity admitted liability six days before an employment tribunal was due to hear the case in May 2004. The RLSB accepted liability for unfair dismissal but denied bullying or harassment. Negotiations had stalled over the exact level of compensation.
"We are pleased the matter is now settled," said the charity in a statement.
Martin said: "I would have considered an earlier settlement if the organisation's trustees had acknowledged bullying and harassment had taken place. They have never accepted this, despite the evidence of many people."
Guy Dehn, director of the whistle-blowing charity Public Concern at Work, said the case illustrated the need for public disclosure of details of cases that are settled in advance of public hearings.