Longtime Knox County Purchasing Director Hugh Holt on Friday stepped down from his job overseeing procurements and contracts for the county and school system after an internal investigation found that he harassed a “subordinate,” according to county records.

On the same day that he resigned in lieu of being fired, Holt took a job with the Knox County Sheriff's Office where he will be in charge of the department’s purchasing agreements and bidding duties.

Holt, who earned $136,500 annually, worked for the county for 28 years and had been director since 1998.

Knox County Finance Director Chris Caldwell will take over his duties until a new purchasing director is named.

"All current and future Knox County procurement activities will continue as normal, and contracts with Knox County will not be impacted," county Communications Director Michael Grider said in a statement.

Grider said the Mayor’s Office will not comment further on the matter.

Attorney John Valliant, who represents Holt, told 10News on Monday: "We are contemplating legal action, which has a defamation component to it."

WBIR 10News obtained a copy of Holt’s personnel file.

It said he “resigned in lieu of termination” . . . as a result of a human resources investigation “resulting in a finding of harassing behavior toward subordinate employee.”

The file provides no details into the allegations.

The county’s harassment policy says all complaints of harassment “must be investigated promptly and impartially, with confidentiality maintained to the greatest extent possible,” according to the county employee handbook.

Any employee found to have engaged in harassment “will be subject to appropriate disciplinary action, up to and including discharge.”

The county handbook notes that harassment includes: verbal or physical conduct by any employee that harasses, disrupts, or interferes with another’s work performance or that creates an intimidating, offensive, or hostile environment.”

As purchasing director, Holt often oversaw the county's bidding process and was instrumental in a number of key decisions.

County leaders credited him several years ago with saving money when it built Carter Elementary School. He also helped ease tensions when officials were working to get a new E-911 radio system for first responders by helping to bring in a consultant.

His annual reviews also earned him high marks from his peers.

Knox County Sheriff Jimmy "J.J." Jones said Holt will serve as the department's director of procurement and earn $137,000 annually.

"We are a large enough organization that we need a director and we've been talking about it for years and now we've been able to get the best person for the job," Jone said.

The sheriff declined to comment about Holt's previous employment with the county.

Holt did not return a call seeking comment.

In his resignation letter to Caldwell and county Mayor Tim Burchett's chief of staff, Dean Rice, Holt said: "I would like to express my gratitude to you and the citizens of Knox County for allowing me to serve . . . for over the past two decades. It has truly been an honor. I spoke with Sheriff Jones and he is going to allow me to assist you and the procurement staff with the transition."