Lawrie Sanchez is in a compo battle with former club Fulham.
Craven Cottage chairman Mohamed Fayed is believed to be reluctant to pay off Sanchez after his former manager spent £26million last summer but landed his team in the relegation zone.
Sanchez quit as Northern Ireland boss to take over from Chris Coleman at Fulham. He had signed an 'indefinite rolling contract' after being named as permanent manager in May and believes he is entitled to a significant six figure pay-off.
It is believed Sanchez's former assistant Terry Gibson has reached a settlement.
A Fulham spokesperson said: "Our lawyers are in contact with Lawrie Sanchez's lawyers. Negotiations are on-going."