A Christchurch woman with breast cancer was horrified when she found Work and Income noted her inability to work was down to "sexual activity".
The woman, Louise, who didn't want her surname to be published, told Fairfax Media she was "horrified" when she saw the note on her case file, and asked for it to be removed.
She was assured by her case manager it would be, but it wasn't removed when she called a second time.
"I just felt, it was too far. I'm annoyed they never took it off, and they're just so dismissive of people on benefits," she told Fairfax Media.
"I definitely don't want it there - they're my personal records. And what kind of a reason is that to even have for not working?"
The Ministry of Social Development national commissioner Penny Rounthwaite told Fairfax Media a coding error was made in her file.
"We have fixed this, and have apologised to [Louise] for any distressed caused."
"Work and Income maintains a list of over 42,000 codes. These codes are not limited to describing reasons for work incapacity.
"A code could be used to describe anything from parental marital problems, to exercise habits, to health conditions," Rounthwaite said.
Labour social development spokeswoman Carmel Sepuloni told Fairfax Media that Louise was "treated appallingly".
"She's done everything right; she has been working, she's gotten sick and then she's gone in there for support.
Sepuloni said she didn't know why sexual activity would be a reason to collect a benefit, but Louise's experience was a flaw in the policy.
"It's not an isolated case and this is the issue with the way in which the Government has structured the welfare system.
"So people like Louise are forced to go on a jobseekers benefit, which is disingenuous given she does actually have a job to go back to, but she's unwell and temporarily having to access the welfare system."