Gurpal Singh Virdi, 66, of Clover Street in Chatham, says he was forbidden from leaving the Siri Guru Nanak Gurdwara Temple in Byron Road, Gillingham and often worked 17-hour days during his 15 years as a Granthi (Sikh priest).
The father of three, a decorated soldier, claimed he was unfairly dismissed after he refused to take a pay cut in August 2008.
Mr Virdi's case was due to be heard at Ashford Employment Tribunal on October 10, but the temple's trustees agreed to pay him £62,000 to settle, making no admission of liability.
Temple bosses have strongly denied all the claims, saying they do not treat priests as "slaves", and that Mr Virdi received free accommodation, food, gas and electricity on top of his salary.
Mr Virdi told the News: "At no time was I allowed to leave the temple without permission. If I wanted to visit anyone, I wasn't allowed without the temple committee's permission.
He added: "I've begged and borrowed from everyone, all my friends, to pay for the solicitors' fees."
When Mr Virdi first joined the temple, he was paid £50 a week.
He and his wife Gurpax, 61, lived rent-free in a flat above the temple, and were given food.
Mr Virdi claimed his bosses deducted National Insurance contributions from his pay, despite it being below the required threshold, leaving him with little money to buy extra food, clothes and essentials.
The father of three, originally from Punjab, alleges that on his return from holiday in August, 2008, he was ordered by temple bosses to sign a new contract that would drop his pay from £405 to £350 per month, and put him on a three-month probation. He refused and was later dismissed.
In a previous case in 2009, Mr Virdi was paid more than £4,000 by the temple after claiming backdated salary.
Committee chairman Julhar Singh Chohan said: "We respect priests, we don't use them as slaves."
He said at least two Granthis had been employed during Mr Virdi's tenure, and that they shared the hours between them.
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