NSW Minister for Transport Jo Haylen's office has been accused of acting unlawfully by interfering in the appointment of departmental staff in the public service.
The minister's chief of staff requested the appointment of a specific senior executive to lead the transition office after the March election, a budget estimates hearing was told on Tuesday.
That breached rules designed to keep the public service at arm's length from the government, the opposition said.
"It's in breach of the act to tell the public service who to employ," opposition transport spokeswoman Natalie Ward later told reporters.
"So much so that Susan Carroll said they were required to get legal advice."
Ms Carroll, the department's chief of staff, told the hearing the request to then-secretary Rod Sharp prompted further questions.
"The minister's chief of staff raised with the former secretary that request and there was a conversation in relation to that request and legal advice was taken," Ms Carroll told the hearing.
The transport minister insisted proper processes were subsequently followed, with a public recruitment process run to find the head of the critically important office.
"It illustrates the value of robust and frank advice from a public servant to ensure proper processes occurred," Ms Haylen told the hearing.
Her office later firmly rejected the "false" allegation of illegality, saying the department advised it on how to properly proceed with establishing a transition office.
"The minister's office followed that advice and supported the establishment of a recruitment process," a spokesman told AAP.
"That was the appropriate course of action to take."
The episode is the latest staffing scandal linked to the minister, whose chief of staff Scott Gartrell resigned on Friday.
Ms Haylen has declined to explain why Mr Gartrell resigned but denied the semi-retired goat farmer was her scapegoat.
The departure came after a Labor-linked public servant parachuted into Ms Haylen's office appeared to have breached the terms of his apolitical role.
Former party candidate Kieren Ash is under investigation after emails emerged last week revealing he organised a barbecue for Labor election volunteers and circulated a list of coalition "backflips".
Ms Carroll confirmed she was among officials who raised concerns with Mr Gartrell about Mr Ash's party links months before the secondment was terminated in September.
Howard Collins, who acted as transport secretary for four months, said he had advised Mr Gartrell to ensure department liaison officers such as Mr Ash, paid by the department, did not stray beyond their brief.
"I didn't have concerns but my staff did raise them on a couple of occasions," he told the hearing.
Mr Ash had appeared on a list of department staff Ms Haylen's office wanted to be seconded as liaison officers.
Greens MP Abigail Boyd asked why the minister did not choose to get "ahead of the game" when evidence of Mr Collins' concerns for Mr Ash first emerged.
"It appears Mr Collins was right," Ms Boyd said.
But Ms Haylen said concerns were handled by Mr Gartrell and no issues were raised directly with her.
Her dealings with Mr Ash in his role as liaison officer were that he stuck to expertise on inter-governmental affairs and other advisory matters, she said
Mr Collins said he considered Mr Gartrell the right person to handle it because he was responsible for employment in the ministerial office.
The coalition said it was not plausible the minister was unaware of Mr Gartrell's actions and conversations with senior departmental officials.
Ministers and their chief of staff "are joined at the hip", Ms Ward told reporters.
The Melbourne Cup day hearing came after Ms Haylen faced repeated questions in parliament over her appointment of former Labor government staffer and infrastructure executive Josh Murray to lead the transport department.
Premier Chris Minns has rejected calls to sack his minister, saying she was the right person to pilot the department after years of turbulence.
