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Former Fulham head coach René Meulensteen has agreed a settlement with the club, although the sum is far less than he would have received if he had been sacked.

The Dutchman took over as manager from Martin Jol in December but did not have his title of head coach changed. His role became untenable last Friday when the club relieved him of first-team duties and appointed Felix Magath.

The club did not sack Meulensteen, as that would have left them liable, through the terms of his contract, to a much larger pay-off. His deal was set to expire in the summer.

Meulensteen leaves Craven Cottage along with the first-team technical director, Alan Curbishley (first team coach), and the coaches Ray Wilkins (assistant manager), Jonathan Hill and Mick Priest. Magath has brought in the first-team coach Tomas Oral and the fitness specialist Werner Leuthard.

The owner Shahid Khan said: “I’m very grateful to RenĂ©, Alan and Ray, as well as Mick and Jonathan for their commitment to Fulham. Their efforts were admirable and appreciated, and I wish them the best.”

The sports employment lawyer Will Nash, a senior associate at Charles Russell who has advised Premier League clubs and managers on employment cases in the past, believes Meulensteen could have a case for constructive dismissal if he walked out of Fulham.

He said: “Trying to make him do something that he doesn’t agree with is almost certainly a breach of his contract. Even if he was still technically under his contract as ‘head coach’, it doesn’t sound like [Felix] Magath is going to want him to have the authority that he might have expected as a head coach.

“As a matter of law, if you are effectively demoted or your duties are reduced, then you can argue as the employee that the employer has breached your contract. But then it’s on you to actually walk out.

“At law, if they’ve effectively demoted him, which it sounds like they have, he’s going to have the ability to say I’m suing you for the rest of my contract.”

Ironically one of only a few Premier League managers to have won a constructive dismissal case against a top-flight club was Curbishley, following his departure from West Ham in 2008.