The top civil servant at the Northern Ireland Office (NIO) has assured staff they should be able to raise concerns without fear of repercussions.
Sir Jonathan Stephens emailed staff after it was claimed £10,000 was paid in compensation to an employee who was offended by having to walk past portraits of the Queen.
The former Ulster Unionist MP went on to name the civil servant.
Speaking in the House of Lords, he said the employee claimed under human rights legislation that it was unfair for him to have to work where he was offended by portraits.
‘Matter settled secretly’
They were later removed, claimed the peer, and the man was consulted about what should replace them.
The replacements were said to include photographs of the Queen meeting people during engagements in Northern Ireland, including her handshake with the former Sinn Féin deputy first minister Martin McGuinness at the Lyric Theatre in Belfast.
Lord Maginnis said: “I do not mind that; what I mind is that the case brought by the complainant was settled secretly and that the sum of £10,000 was handed over, presumably for hurt feelings and distress.
“This settlement was signed off by the then Secretary of State Theresa Villiers MP on the recommendation, I am informed, of her permanent secretary Jonathan Stephens,” he added.
“I have been told to look at the annual accounts to find out where the money came from but it is not to be found.
“That should concern us.”
‘Stories like this unhelpful’
In response, the NIO said it took it obligations under fair employment legislation “very seriously” but it would not comment on individual personnel matters.
But Sir Jonathan has emailed every civil servant at the NIO to “offer some reassurance”.
In the email, seen by the BBC, he said the office was in contact with the individual and offering support.
“The department will always offer support to staff who need it,” he added.
“As civil servants we all take protection of personal and other information very seriously and… we are investigating how this happened and what further action is needed in this case.
“We want everyone to feel they work in a positive, supportive working environment.
“If someone raises a concern we will address it.”
“Everyone should feel able to raise concerns without fear of repercussion.
“That is why stories such as this are particularly unhelpful.”
Sir Jonathan finished the email by telling staff that if they had concerns about anything at the NIO or if they “feel something is not as it should be” they should discuss it with senior staff, including himself.