He had also been charged with a breach of betting rules by the Scottish Football Association (SFA) in October and was signed off due to stress earlier this week as negotiations took place over a severance deal.
Barton, who has a history of disciplinary problems, was suspended in September by Rangers following a training-ground dispute with team mate Andy Halliday following a 5-1 thrashing by Celtic in the Old Firm derby.
He was then charged with placing 44 bets on football matches this year, against SFA rules that prevent players, coaches, club officials and referees in Scotland from betting on football anywhere in the world.
Barton, who has also played for Manchester City, Newcastle United, Queen's Park Rangers and Burnley, is no stranger to controversy having served bans for violent conduct on and off the pitch during his career.
He broke a pedestrian's leg while driving his car in 2005 and was jailed for six months in 2008 after admitting assault and affray.
(Reporting by Toby Davis, editing by Pritha Sarkar)
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