"We will continue with the announced competition to find a new principal for Kiviõli High School because we did not reach an agreement with Heidi Uustalu to sign an acting principal contract," said Lüganuse Municipal Mayor Viktor Rauam.

On Friday, the municipal government made a compromise proposal asking Uustalu to accept the extraordinary dismissal of her employment contract and to waive all claims. In return, the municipality offered Uustalu to continue as acting principal until the end of the current school year.

Uustalu stated in a reply that "such a condition could not be accepted because there was no basis for me to terminate the contract of employment."

Uustalu made a counteroffer that said "Lüganuse Municipality acknowledges that the extraordinary termination of its August 2, 2004 employment contract with Heidi Uustalu was null and void."

"If the municipality accepts this condition, there are other parts of the compromise that can be talked about," Uustalu said.

Following the rejection of Uustalu's offer, the rural municipality government decided that the competition for the job should continue and candidates would be considered from among the school staff and outside. 

Rauam and Uustalu met a week ago and at the time Uustalu suggested the municipality would either accept the action in the current case or reach a compromise in court proceedings.

Uustalu went to court after Rauam announced that the municipal government had terminated its employment contract with Uustalu.

Lüganuse Municipal Government terminated Uustalu's employment in December. The council's decision came after Uustalu, a member of the Reform Party, had allowed the school to hold a meeting of the youth wing of the Reform Party.

Students and staff protested Uustalu's dismissal and teachers held an hour-long warning strike before Christmas and threatened to strike indefinitely if she was not reinstated. They canceled the strike action while negotiations took place between Uustalu and the council.

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