The regional industrial organiser for the union Unite says the news police are to take no action against the chairman of the employees' side of Whitley Council has made no difference to his belief that John Houghton, MHK, should leave his position as chairman of the employers' side.
Angus Kelly was reported to police by Mr Houghton, over comments made in a meeting.
Mr Kelly says he is relieved the matter is going no further, but is still angry because he believes the allegations were "spurious and groundless".
Mick Hewer (pictured) from Unite says he will be meeting with Chief Minister Tony Brown, who has expressed the hope the matter can be resolved amicably, tomorrow.
However, he feels the matter is far from over and still thinks Mr Houghton has to go.
He told Manx Radio:
"Mr Houghton has made some accusations.
"The manner in which those accusations were made and to whom he made them we still feel is completely inappropriate.
"It should have been dealt with in-house, and my colleagues and I still feel that John Hoghton's position is untenable.
"He cannot remain in his position as chairman of the employers' side on Whitley Council."
There has been no comment from Mr Houghton on the decision not to take any action against Mr Kelly.
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