It is a leading charity dedicated to treating the dogs and cats of the poor, but it stands accused of treating its employees worse than the animals.

Yesterday the PDSA charity caved in rather than face accusations of mismanagement at a tribunal and paid a senior vet a sum of nearly £100,000.

The charity, one of the 50 wealthiest in Britain, which depends on donations from the public, has withdrawn from contesting a case of unfair dismissal by one of its vets working at its main PetAid hospital.

After a 15-month struggle Katie Goldie, the longest-serving vet at the Glasgow branch of the charity, has learnt that she is to receive compensation from the PDSA equivalent to the maximum that an employment tribunal would have awarded her and will have her costs paid. Mrs Goldie is one of four former veterinary staff from Glasgow compensated by the PDSA for suspension or sacking, rather than face tribunals. In other cases around Britain former employees have been bound by compromise agreements.

Last year the Charities Commission dismissed a call by MPs for an investigation into the PDSA.

It is a sorry tale for the charity, which was founded in November 1917 in a cellar in Whitechapel, East London, by Maria Dickin. She called it the first People's Dispensary for Sick Animals of the Poor and her aim was to bring life-saving treatments and medicines to animals whose owners were unable to afford a vet.

But that devotion to sick pets, supported by the kindness and generosity of animal-lovers who contribute to the charity's funds, does not appear to extend to all employees.

The PDSA's bruising treatment of Mrs Goldie extended to its attempts to silence The Times with threats of legal action as the paper tried to report staff discontent in Scotland and the North of England.

Last night two MPs criticised the PDSA, which employs nearly 1,800 staff at 250 locations across Britain. Anne McGuire, Labour MP for Stirling, said: “If I was a trustee of the PDSA I would now be asking questions as to why long-standing, loyal employees have found themselves in this position and why the PDSA as a result are having to pay out significant sums of money.”

Jo Swinson, Lib Dem MP for East Dunbartonshire, said: “I think there needs to be some recognition that, if the charity is in this situation, it is because things have gone wrong for which it needs to take responsibility, and it needs to put things right for the existing staff.

“What's happened shows that things haven't been working properly in employment terms and the PDSA does need urgently to look at what it is doing and make sure there is no repeat of this.”

Mrs Goldie was suspended and then sacked last year for alleged gross misconduct — although she was never certain as to what she had done wrong. After a petty incident at the clinic involving a receptionist and a mobile phone — which did not involve her initially — Mrs Goldie and three senior clinical colleagues were suspended.

Two of them — the former chief vet and the former chief nurse — signed compromise agreements and received an unknown sum of compensation. Last January the third, a veterinary nurse with 16 years' service, settled minutes before the start of an employment tribunal to hear her claim for unfair dismissal.

At a conservative estimate the total amount paid to the four employees must approach £200,000 — a sum that could have been used to treat a considerable number of animals.

The charity, which has consistently denied using compromise agreements to muzzle dissent, has said in the past that such agreements represent financial commonsense, and that there had been 12 others since 2003, at a cost close to £180,000. Had the cases gone to tribunal the cost would have risen to nearly £357,000, it said.

Mrs Goldie's lawyer, Alan Thomson, of McClure Naismith, a leading employment specialist, said: “The whole process was characterised by unfairness and unreasonableness. I would say that the PDSA behaved like an employer who considered itself to be above the requirements of the law and acting in a completely unreasonable manner throughout.”

A file on Mrs Goldie's case is presently with the Office of the Scottish Charity Regulator. A spokesman said: “We have a complaint and are in the process of deciding whether to proceed.”

The charity, which has funds of about £100million, said in January that Marilyn Rydstrom, 60, its director-general, is to retire in June. It also confirmed that Susan Mooney, one of the charity's five principal veterinary surgeons, responsible for Scotland and the North East of England, was to leave.

Sandra Donnelly, who was the PetAid hospital manager in Glasgow, left the charity in December.

The PDSA confirmed that it had reached a mutually acceptable settlement with Mrs Goldie but denied any liability for the complaint or any mismanagement.

The charity said: “Last year, Mrs Goldie was dismissed following a lengthy, robust and impartial disciplinary investigation, which concluded that acts of misconduct had been committed. She later contested this outcome, lodging a complaint of unfair dismissal with an employment tribunal in Glasgow.

“PDSA made repeated attempts to bring the matter to a resolution by mutual agreement, including exploring compromise through Acas and offers to take the case to independent mediation. All such options were turned down by Ms Goldie.

“We therefore considered a settlement to be the next best solution in order to avoid further pressure both on our vital veterinary service and on individual staff, especially those at the PetAid hospital in Glasgow.

“PDSA is committed to best practice, both in its standards of employee relations and in its veterinary care for pet patients. We regularly review our policies and practices in these areas. Indeed, one employment tribunal chairman praised PDSA in June last year for having ‘gone the extra mile' to observe best practice. Why would PDSA choose to act differently in any other situation?

“Furthermore, we have had no problem recruiting new staff either from within or outside the charity. Nor has there been an adverse impact on the provision of our charitable services, indeed our PetAid hospital in Glasgow last year provided more than 60,000 free treatments to sick and injured pets.

“As a caring and responsible employer, we naturally regret any adverse employee relations issues that arise. That is why we have resources and processes in place to resolve any such issues in a fair and timely manner.”

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