Henderson approves $1.28 million settlement with former city manager

By Paul Takahashi

Tuesday, Feb. 15, 2011 | 8:32 p.m.

The Henderson City Council voted Tuesday night to approve an almost $1.3 million settlement with its former city manager, who sued the city after she was fired in 2009.

Mary Kay Peck, who was employed by the city for nearly 14 years, was fired by the council in April 2009 after serving as the city’s first female city manager for 18 months.

Under the arbitration settlement agreed upon by her attorney and the city, Peck will receive $1,287,099 in damages from the city. Councilwoman Kathleen Boutin was the sole dissenting vote against the resolution.

“We have the arbitrator’s decision before us,” Mayor Andy Hafen said. “It’s time to move on.”

“This decision absolutely vindicates her,” said Peck’s attorney, Norman Kirshman. “She is very happy with the decision.”

Peck was fired during a City Council meeting on April 14, 2009. Council members at the time said they dismissed her for not fully disclosing the city’s financial status to them.

“It was a calamity for her,” Kirshman said, likening the meeting to the Salem witch trials. “She was accused of not doing her job and creating a ‘culture of fear’ among city employees. It was done at a public meeting and neither she nor I were given any meaningful opportunity to comment on the allegations.”

Peck filed a lawsuit against the city in May 2009, alleging that the city violated her due process rights.

Although the U.S. District Court dismissed Peck’s lawsuit after determining her due process had not been violated, Peck’s claim that the termination violated her employment contract proceeded to binding arbitration.

In December 2010, arbitrator Gerald McKay determined that the city did not provide sufficient cause to fire Peck under its contract.

Peck received $160,000 in accrued benefits from her $225,000-a-year job when she left. The settlement awarded Tuesday includes attorney and arbitration fees.

Councilwoman Debra March, who was not a member of the City Council when Peck was dismissed, said she would like to see the city re-evaluate fees on third party counsel and arbitrators in the future.

Peck currently lives in Florida and is still searching for a job, Kirshman said.

“She’s feeling a little better now, but only time will tell if new opportunities will open up for her,” he said.