One of the Care Quality Commission officials accused of covering up a report criticising the regular has been exonerated by an internal investigation.

In an announcement posted on the CQC’s website yesterday the regulator said the internal investigation had found head of media Anna Jefferson had “no case to answer” and she would not face disciplinary action.

The internal investigation examined allegations made in a report by Grant Thornton into the CQC’s regulation of University Hospitals of Morecambe Bay Foundation Trust. The CQC commissioned report claimed former deputy chief executive Jill Finney ordered the deletion of an internal review by head of regulatory risk Louise Dinley and that Ms Jefferson and former chief executive Cynthia Bower supported the order.

All three vehemently denied the allegations when the Grant Thornton report was published in June. The CQC launched an internal investigation in Ms Jefferson as she was still employed by them, although on maternity leave at the time.

Speaking to HSJ yesterday, Ms Bower welcomed the CQC’s decision on Ms Jefferson.

She said: “It was clear once the report was subject to proper scrutiny, by the police and proper employment processes, it would come to nothing. How does that square with the impression the CQC gave of us of conspiring to cover up poor care at Morecambe Bay?”

Police in Cumbria confirmed in July they would not be taking any action as a result of the cover-up allegations.

The Grant Thornton report alleged that during the discussion of the Dinley report Ms Jefferson said: “Are you kidding me? This can never be in a public domain nor subject to [Freedom of Information legislation].” The CQC’s announcement yesterday said Ms Jefferson had not used “any inappropriate phrases” and had not supported “any instruction to delete an internal report”.

The announcement concluded: “The CQC regrets any distress Anna Jefferson has suffered as a consequence of this matter and is pleased to welcome Anna back to the organisation following a period of maternity leave. She is currently undertaking a course of postgraduate study with CQC’s support.”

One senior human resources expert told HSJ it was likely Ms Jefferson would have a case for breach of contract, defamation or constructive dismissal if she chose to resign.

Chief executive of Managers in Partnership Jon Restell said the case reinforced the point that “neither reports and inquiries nor media and public criticism” should be “allowed to replace fair employment procedures”.

He added: “Employers nearly always get it wrong when they make employment decisions based on conclusions of reports commissioned for other purposes or on media comment.”