Customs must develop policies to help staff whose mental health is risked by their work, states an Employment Relations Authority (ERA) decision that awarded a worker more than $245,000.
The ERA ruled former Customs worker Douglas Alo should not have been dismissed from his job.
Mr Alo suffered post traumatic stress disorder from his work in the 2004 post-Tsunami relief effort in Southeast Asia, developed depression and an alcohol problem and his marriage broke up.
A complaint was made against him and he was sacked from his job as Customs liaison officer for Southeast Asia in Bangkok on July 22 2008, after 22 years with the service.
During the investigation the service was advised of his mental health issues but went ahead with its decision.
ERA member Marija Urlich said Customs should pay Mr Alo lost earnings of more than $164,000, plus $40,000 for unjustified disadvantage and dismissal, $21,500 for medical costs and general damages of $20,000.
Before the tsunami – which killed about 230,000 people – Mr Alo was healthy, but afterward he suffered severe psychological effects.
The service offered him a trip home and a visit to the psychologist New Zealand Police sent to help post tsunami relief workers.
Ms Urlich found Mr Alo was put at risk through his work and Customs didn't take reasonable steps to minimise or avoid harm.
"Mr Alo and his ex-wife gave moving evidence of the devastating impact of the events following his deployment in the tsunami relief effort," she said.
"Mr Alo's colleague... described him as a broken man. It is clear Customs' actions in failing to monitor and support Mr Alo adequately and dismissing him have had a profound professional and social effect on Mr Alo."
Customs had argued that Mr Alo should have asked for help after the tsunami but Ms Urlich said he was too unwell to do that. It also argued that the tsunami was not the cause of his other problems such as his alcohol use and marriage breakup.
"Expert evidence was clear that these tragic circumstances around from the traumatic events Mr Alo experienced during the course of his duties... I have no hesitation in finding Mr Alo has not contributed in any way to the events giving rise to his personal grievances," Mr Urlich wrote.
She recommended Customs develop policies for staff exposed to situations where they could suffer psychological harm with special regard to people posted overseas.