THE former director of football for Celtic will receive #612,522 over his dismissal by the club in June this year.
Kenny Dalglish sued the club for nearly #1m, which included #750,000 in lieu of notice, #200,000 in unpaid share option cash and #35,163 for unpaid pension contributions over the period of his employment. He received #585,000 for termination of contract and #27,000 in pension contributions.
At a preliminary hearing at the Court of Session yesterday, Lord Macfadyen was told that the case had been settled for a restricted amount.
Afterwards, Mr Dalglish said: ''Anyone who has a contract in any job or any walk of life, if they are given the sack they expect the contract to be honoured.
''I have never caused Celtic any trouble. All I wanted was to see my contract honoured. I did not want to leave the club and I did not seek to leave.''
A counterclaim of #60,000 by Celtic on the basis that Mr Dalglish was overpaid over his relocation expenses from Durham - where he lived when he was manager of Newcastle United - was dropped.
Brian Napier, advocate for Mr Dalglish, whose address was given as Belhaven Court, Newton Mearns, Glasgow, said it was agreed the matter would be settled yesterday.
He asked Lord Macfadyen for a decree for the reduced sum in return for the counterclaim being dropped, which was granted.
Mr Dalglish was summarily dismissed from his #600,000-a-year job on June 29 this year, after Martin O'Neill, former Leicester City boss, took over as manager.
His sacking at Celtic Park after a year in the job followed the dismissal of manager John Barnes following a disastrous season in which Celtic languished behind Rangers in the league by a record 21 points and suffered a humiliating Scottish Cup defeat by minnows Inverness Caledonian Thistle.
A spokesman for Celtic said: ''Celtic will comply with the terms of the court order and now considers the matter closed.''
A source at the club added that, when he was dismissed, Mr Dalglish was offered ''a very generous'' #300,000, but the club is now having to pay more than double that amount.
Peter Rafferty, chairman of the Affiliation of Celtic Supporters' Clubs, said many fans would be disappointed by the action Mr Dalglish had taken and the amount of money he had received, given his lack of success.
The former Parkhead player also starred for Liverpool before going on to become manager there, and at Blackburn Rovers and Newcastle United.
He made an #8m claim for unfair dismissal after he was sacked at Newcastle, but both parties agreed an out-of-court settlement part of which was that the amount should not be revealed, but it was believed to be about #300,000.
Dalglish, Scotland's most capped player, began his career at Celtic in 1967, the year they became the first British club to win the European Cup, and made his first team debut two years later, playing 324 games before signing for Liverpool in 1977.
He played there for eight years, winning many honours in England and Europe, before starting his managerial career when he was appointed player-manager at the club in 1985.
Celtic's shares, which have dropped sharply recently, were yesterday down 11.5p at 172.5p.
King Kenny's big scores
CELTIC:
l #1.2m for one year's
work includes:
l #600,000 - salary
l #585,000 - termination of contract
l #27,000 - pension contributions
NEWCASTLE UNITED:
l #300,000 - out-of-court settlement after claiming unfair dismissal
LIVERPOOL:
l #200,000 - testimonial match
BLACKBURN:
l No pay-out - Dalglish resigned from post of manager
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