Prime Minister Jacinda Ardern has announced that Meka Whaitiri has been removed as a minister with immediate effect.
Ardern told reporters that a report has confirmed that an incident that occurred, though Whaitiri disagrees with some of the information.
She no longer had confidence in Whaitiri as a minister, she said.
Whaitiri contested the allegations, but Ardern said she spoke to her this morning.
Because it was employment issue, there were privacy reasons she would not give more details.
Ardern said the Maōri caucus supported her decision.
Newstalk ZB political editor Barry Soper told Andrew Dickens the PM had little choice in the matter.
"Jacinda Ardern had to be seen to be resolute on this, one way or the other. If she was going to keep her on, she'd have to argue why that was going to be the case."
Whaitiri was suspended as a minister after allegations of an altercation with a new staff member.
The alleged incident, which took place in Gisborne in August, has been under investigation by Ministerial Services.
Whaitiri held the portfolios of Customs, Associate Agriculture, Associate Crown Maori Relations, Associate Forestry and Associate Local Government.
Ardern accepted Whaitiri's offer to stand aside while the investigation was carried out after the initial announcement.
Whaitiri, who is the MP for the Māori electorate of Ikaroa-Rāwhiti, remains co-chairwoman of Labour's Māori caucus.
She held the portfolios of Customs, Associate Agriculture, Associate Crown Maori Relations, Associate Forestry and Associate Local Government.