Collingwood has reportedly settled a wrongful dismissal claim with a former employee at the club who accused CEO Craig Kelly of multiple racist remarks.

The Pies confirmed the out-of-court settlement had been reached on Monday, according to theย Herald Sun.

"Mark Cleaver and the Collingwood Football Club announce that the legal proceedings have been resolved," a joint statement released by the club and Mr Cleaver said.

"It is requested that Mark's privacy be respected, and the parties have agreed not to make any further statements."

In July this year, Kelly was alleged to have made racial slurs and engaged in physical assault, a claim lodged by Cleaver.

Kelly was alleged to have made comments regarding a "culture room" at the club, insinuating Indigenous slurs as well as joking about sending a photograph of a โ€˜Free Palestine' sign to a Jewish colleague.

According to theย Herald Sun, Mr Cleaver had alleged in court documents that Mr Kelly had described Aboriginal elder Aunty Carol โ€“ the wife of Dardi Munwurro chief executive Alan Thorpe โ€“ as a โ€œdumb old bitchโ€.

Dardi Munwurro has had a partnership with Collingwood since 2017 but has since ended as a result of the scandal.

The court documents also detailed how Mr Kelly was accused of joking about putting a โ€œlive f---ing possumโ€ in a special room at the club for Indigenous players.

The Herald Sun revealed in June that Cleaver had demanded at least $250,000 to drop his claim before Collingwood came back during mediation talks with a settlement offer of about $20,000.

It is not known if the settlement included a payment.