Brown on Sunday said she rejected the Eskom board's reasoning for offering him that sum as "lacking in legal rationale" and gave it a week to reformulate a proposal.
"Given that I was not a party to the contract of employment concluded between the Eskom board and Mr Molefe I have instructed the board to urgently engage Mr Molefe and report back to me with an appropriate pension proposal within seven days," Brown said.
The DA and civic rights pressure group OUTA commended Brown for her intervention.
Natasha Mazzone, the DA's public enterprises spokesperson, said the proposed payment was a golden handshake disguised as a pension settlement and Molefe did not deserve it after leaving Eskom under a cloud late last year when he was fingered by then Public Protector Thuli Madonsela in her report on state capture.
"The DA calls upon the Eskom board to revert to Minister Brown with a new proposal for Brian Molefe's golden handshake to be R0.00. Brian Molefe does not deserve anything further from Eskom, and it is high time the minister got management and leadership at the utility in order."
Outa chairperson Wayne Duvenhage commended Brown for calling halt in what he called a pattern of "incessant and unnecessary" golden handshakes to officials.
"Golden handshakes of this nature, which are often paid to those connected to the president, have frustrated the public for far too long. We are pleased to see people in authority like Ms Brown, doing something about this irrational conduct within government and its state-owned entities."
He called on Brown to scrutinise the board's decision to attempt to pay Molefe millions and sanction those responsible.