Andrew Watkiss, assistant company secretary at Unigate was offered the pounds 60,000-a-year post after being interviewed by the Laing's chairman last January. But at a medical examination the following month, Mr Watkiss, 46, disclosed that he had been a diagnosed schizophrenic for nearly 20 years and the job offer was withdrawn.
Mr Watkiss sued the company under the Disability Discrimination Act and it emerged yesterday that he had been paid an undisclosed fee in damages after Laing admitted discriminating against him. He said: "I believe their decision was made in ignorance and fear. They saw the word `schizo-affective' and they ran a mile."
Campaigners said last night that the out-of-court settlement would enable job applicants to challenge employers who discriminated against them solely because they had a history of mental health problems.
Mr Watkiss, from west London, admitted yesterday that he had not disclosed his condition at the interview stage. He said: "You do not go in for a job of that order and just say `I have had a schizophrenic illness'. The competition is such that even the slightest reason for them not considering you would put you out of the running."
He disclosed his schizophrenia after being asked at his medical examination whether he took any form of medication. He later received a letter saying that Laing did not believe his state of health would withstand the pressures of the job.
For the past eight years hehas used an anti-psychotic medication which has enabled him to control his condition whilst carrying out a demanding role at Unigate. His own company secretary gave a statement in support of his legal case against Laing, praising his work performance.
Mr Watkiss' solicitor, Paul Daniels of Russell, Jones and Walker, said his client had won a "landmark" settlement. He said: "Employers who make blanket assumptions about the abilities of people with mental health difficulties risk substantial claims for disability discrimination." The settlement was also welcomed by the mental health charity Mind.
Its principal solicitor, Simon Foster, said: "Job applicants should be judged on their ability to do the job and not an outdated assumptions based on their mental health history."
No-one at Laing was available for comment.