The Lakes District Museum has "resolved the differences" with a staff member made redundant after a restructuring last year, in an out of court settlement.
In a joint statement, instructed by the Employment Relations Authority, the museum said it regretted "any distress" the restructuring may have caused to those involved.
After the museum board reviewed operations in July 2011, citing difficult trading conditions, three staff members were made redundant.
Former retail and administration manager Bridget McDonald was one of those made redundant and took a dispute over long-service leave to the Employment Relations Authority. That dispute has now been resolved.
"Whilst there is no admission of liability by either party, it is acknowledged that some things could have been done better," the museum said.
