The state has agreed to pay a former Department of Corrections employee $95,000 to settle a federal lawsuit alleging sexual harassment by her former boss.

The negotiated settlement was reached Thursday afternoon between Linda D. Dreitzler and the attorney general's office.Dreitzler's attorney, Kathryn Collard, said a stipulation will be filed in federal court asking for dismissal of the civil sexual harassment case, which named the state of Utah, Corrections Department chief Gary DeLand and Inspector General Scott McAlister as defendants. DeLand, however, said he has since been dismissed from the suit.

"I think the amount of the settlement speaks for itself as to the strength of our case," Collard said.

Dreitzler was secretary to Mc-Alister. Her suit, filed in August, said she was demoted, transferred and eventually discharged because she refused to submit to McAlister's sexual demands.

According to the suit, McAlister used his authority to obtain employees whom he found "sexually attractive." Dreitzler said her work station was moved directly in front of his office and away from other personnel.

The suit said her continued employment was made dependent on her acceding to such things as participation in a "corporation" to buy a house with McAlister and another woman for a "three-way sexual relationship."

It also accuses McAlister of giving Dreitzler pornographic films for the purpose of instructing her on how to engage in group sex. In January, Dreitzler provided 30 of those movies to federal investigators.

The films were checked out of an Oregon child pornography evidence file by McAlister when he was an assistant attorney general in that state. McAlister, who resigned from Corrections last December and now lives in Arizona, faces an Oct. 16 trial in 3rd District Court on charges of possessing child pornography.

In the federal suit, Dreitzler said she continued to reject McAlister's advances. In mid-1989, she was told that she was being replaced by Grace Caudill, whom the suit says worked for McAlister in Oregon and later moved in with him in Utah.

McAlister arranged for Dreitzler to be transferred and demoted, the suit said. His conduct caused her such emotional distress that she attempted suicide, it added. Dreitzler was "constructively discharged" from the Department of Corrections on Oct. 23, 1989.

That same day, she filed a complaint with the Anti-discrimination Division of the Utah Industrial Commission. She later withdrew the complaint, according to the federal suit, because McAlister threatened her with "unspecified retaliation" and she feared for her safety.

She resubmitted the complaint on Jan. 16 and then moved the action to federal court after waiting a requisite 60-day interval.

Collard also noted that Dreitzler was not the only Corrections Department employee who has raised the issue of sexual harassment, although hers was the only one to result in a court filing.

"I think the number of allegations also was a factor in the state's willingness to negotiate," Collard said.