The teacher escaped conviction on a charge of having sex with a minor because he convinced the court he did not realize one of the women involved was underage, The Local said. He said his conviction for paying for sexual services does not require him to leave his job.
City officials said they are unable to dismiss the man.
"We don't want him in the organization. We're currently leaning toward a settlement involving an undisclosed number of months' pay," Birgitta Elm, the Stockholm human resources director, told the Metro newspaper.
Metro said the city could have to pay as much as 500,000 kronor ($75,000) to get rid of the man.
Investigators said the teacher was one of a group of businessmen and professionals who paid for orgies with women they found online.
He was fined 2,500 kroner (less than $400).