The small firms lobby group ISME said last night it was terminating the contract of its former chief executive, Mr Frank Mulcahy. The move comes as part of a long-running row within the organisation, replete with claims and counter-claims from different factions.

The organisation's chairman, Mr Seamus Butler, said the contract ISME signed with Mr Mulcahy last November included a six-month probation period, during which either side could give four months notice. ISME had given Mr Mulcahy such notice, Mr Butler said.

"I would emphasise that this is not a dismissal," Mr Butler added.

Mr Mulcahy said last night he had been advised not to discuss the issues surrounding his contract in public.

A meeting of ISME's board held yesterday heard a progress report from director Mr Robert Berney on drawing up a new constitution and rules for the organisation. The changes are scheduled to be in place in advance of the national conference in Waterford this November.