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MACHIAS — Washington County and County Manager Renée Gray have reached a settlement, two months after she sued the commission and two of its members for wrongful termination.
Commissioners signed the settlement agreement Thursday after a lengthy executive session. The county also amended Gray’s employment contract, adding language governing suspension and termination.
The commission voted in early June to fire Gray in a split decision after an executive session, giving her 20 days’ notice as required under her 2023 contract.
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Days later, she filed a wrongful termination lawsuit in Washington County Superior Court, arguing commissioners violated state law that requires notice of termination, a statement of cause, and a public hearing where both sides can be heard before a termination becomes effective.
Gray also alleged sexual harassment, discrimination, defamation and other misconduct.
Hours after Gray filed the lawsuit, the court issued a temporary restraining order, ruling the commission had violated her rights and reversing the termination until a hearing could be held.
About three weeks later, while Gray remained on paid leave, the case moved to U.S. District Court at the county’s request. There, defendants asked the court to dismiss most of her claims, leaving allegations of breach of contract, whistleblower violations, sexual harassment and discrimination, and due process violations intact. They denied all of them.
The county agreed to honor the temporary restraining order for the duration of the lawsuit, and Gray remained on paid leave.
On the advice of legal counsel to comply with the temporary restraining order, commissioners rescinded Gray’s termination Aug. 26. She returned to work two days later.
The commission voted unanimously Thursday to accept a settlement agreement negotiated by legal counsel, but did not reveal its terms to the public.
Monitor Local filed a Freedom of Access Act request for a copy of the agreement immediately after the meeting. The county acknowledged the request Friday afternoon and said it expected to process and respond before Sept. 18.
A copy of the amended employment agreement was provided.
The agreement borrows heavily from state law, citing statutes governing removal of county administrators, and removes the commission’s authority to make final decisions on suspension or termination. Instead, in the event of a suspension or termination, the amended agreement assigns that authority to an arbitrator selected by both parties.
If they cannot reach agreement on a selection, a three‑member arbitration panel will be chosen by the parties.
The arbitrator or panel will schedule and manage a public hearing and issue a final decision that is binding on both parties and not subject to appeal.
If the parties agree on a single arbitrator, the county will pay two‑thirds of the fees and Gray will pay the remaining third.
If a three‑member panel is used, each party will pay the fees for the arbitrator they select and split the cost of the third arbitrator.
Aside from those changes, the agreement’s language is nearly identical to the contract Gray signed when she was hired.
The amended agreement also updates Gray’s annual salary to $94,479. Her salary was $81,800 when she was hired.
In addition to Washington County, Gray named Commissioners David Burns and Billy Howard in the lawsuit in both their official and personal capacities.
Commissioner Courtney Hammond, who voted against Gray’s termination and has publicly supported her, was not named as a defendant.