A nurse who addressed a mental health patient as "nigger" was given an unfair serious misconduct warning, the Employment Relations Authority has ruled.

In addition to the name calling incident, six weeks later nurse Stephen Reader also handed a knife to the same patient and said: "Don't do it."

Both instances upset the patient at the forensic mental health unit in Christchurch. He was particularly disturbed by the second one because his most serious offence involved a stabbing.

The ERA found Canterbury District Health Board's decision to issue Mr Reader with a written warning and notifying the Nursing Council were unjustified.

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In fact, the authority went on to suggest that the initial course of action, which involved a written apology from the nurse and providing training, would have sufficed.

Mr Reader explained that he had been in the mental health sector for nearly 30 years and this was the first incident requiring such serious disciplinary action.

Charge nurse manager Tony Keatley said he had prescribed the initial measures following an informal complaint from the patient and it seemed the matter had been resolved.

However, within weeks the patient lodged a formal grievance.

Following this the service manager of the board's regional forensic psychiatric service took charge of the case and overturned the original course of action.

She carried out her own investigation and much to Mr Reader's chagrin issued him a serious warning and notified the Nursing Council.

Not impressed with the decision the nurse took his case to the ERA, which decided that the notice should be expunged from the record and the complaint to the council should be removed.