Palmer was initially appointed in a caretaker capacity at Field Mill in late November following predecessor Keith Curle's suspension and eventual sacking.
But now the former England international midfielder and Stockport boss has been appointed full-time, he has signed an initial contract running until summer 2006 but revealed he has not been paid a penny for his initial spell with the Stags.
He said: ''The Keith Curle situation meant the club could not be paying another manager, although my accountant was not very happy about it.''