Maureen Jobson, now an education officer in East Lothian, last year challenged her former authority, Midlothian Council, claiming that it had refused to increase her salary as head of Gorebridge primary to the level set under the formula operated by the independent consultants.
With the support of the Educational Institute of Scotland, Mrs Jobson, whose husband Roy is education director in Edinburgh, issued a formal grievance.
It is understood that Mrs Jobson's job-sizing evaluation, based on a September 2002 return, awarded her credit for covering for her deputy who had been off on long-term sickness leave.
Consultants from PricewaterhouseCooper accepted that she was effectively doing two jobs and it is understood that they produced a final salary that was around pound;2,000 higher than that for headteachers of similar-sized primary schools.
Ronnie Smith, general secretary of the EIS, said: "Obviously we are delighted that the integrity of the job-sizing machinery has been upheld, but we very much regret that it has taken the authority this long to come to its senses."
A spokesperson for Midlothian said: "The matter was mutually resolved under the job-sizing procedure, which in this case took longer than was hoped due to staff absences."