Harare former city treasurer, Mr Cosmos Zvikaramba, is demanding US$2,8 million and a top of the range vehicle from his employer for "constructive dismissal".
The matter was discussed last week during a full council meeting but because of its sensitivity, councillors requested that the matter be discussed in committee away from the glare of the media.
Councillors later confirmed Mr Zvikaramba's demands but said Mayor Muchadeyi Masunda blamed the matter on former human resources and general purposes committee chairman Clr Panganayi Charumbira for disregarding expert advice.
Mr Masunda was however, reminded that once a matter becomes a resolution it binds the whole council.
However, minutes of the human resources and general purposes committee, which were adopted by the council were available.
Mr Zvikaramba recently won his case against constructive dismissal at the Labour Court. He assumed the post of city treasurer when Mr Misheck Mubvumbi was suspended.
Following the reinstatement of Mr Mubvumbi, the present council gave all powers to Mr Mubvumbi. As a result Mr Zvikaramba was left without work as he was idle on a daily basis in his office.
The act by the council was also viewed as humiliation of Mr Zvikaramba, who had held fort in the absence of Mr Mubvumbi.
Mr Zvikaramba was demoted to finance director - a post that does not exist in the Urban Councils Act.
But councillors are not happy with town clerk Dr Tendai Mahachi because he never reported that Mr Zvikaramba had opted out of the city citing constructive dismissal.
Sources who attended the committee meeting said councillors directed Dr Mahachi to negotiate an amicable package with Mr Zvikaramba. Councillors want him to be paid three years salary out of his five year contract.
But a human resources expert with the city said such cases were usually paid out until retirement age. The method used to arrive at the US$2 million figure was not given.
While other councillors felt Mr Zvikaramba should return to work, they were advised that the arbitrator had awarded payment of damages and not reinstatement. Council has narrow chances of a successful appeal because it can only do so on a point of law and not fact.
Chamber secretary Mrs Josephine Ncube told the council that Mr Zvikaramba's job description was similar to that of Mr Mubvumbi.
"In practice there were two employees for one position and the situation was beyond council's control. Council's external legal practitioners had advised that prospects of success were 50-50 and the case could go either way," she said.
She said her department had made similar observations. Mrs Ncube said Mr Zvikaramba had served two years of his five-year contract and council could pay him for the three years remaining on his contract.
The city recently paid out US$4,5 million to 317 workers who had been absent from work for up to three years.
The workers returned to work because no formal suspensions and dismissals had been effected, while others who had been improperly fired or dismissed also benefited.
Some of the workers have since left the city after pocketing payouts averaging US$14 000 per employee.