The city council approved the payout to Kelvin Cochran with a vote of 11-3, according to WSB Radio, which was at the city council meeting Monday.
Cochran filed a federal civil rights lawsuit against former Mayor Kasim Reed and the city after his termination in January 2015, contending he was fired because of his religion. Reed said he fired Cochran during his initial 30-day suspension because of poor judgment and insubordination.
Cochran wrote a religion-themed book titled "Who Told You That You Are Naked?" which described homosexuality as "unclean" and grouped it with bestiality.
Attorneys with the faith-based nonprofit Alliance Defending Freedom represented Cochran and filed the suit on Feb. 20, 2015.
In a letter sent to his supporters, Reed defended the firing and said Cochran did not get the required clearance to write the book. He also said Cochran compromised his ability to oversee gay employees and put the city at risk of discrimination claims.
The city found no evidence during its investigation of Cochran that his beliefs had played a role in his leadership.