The former chief of staff for teal independent Monique Ryan has launched legal action against the MP in the Federal Court.
Sally Rugg has lodged a case under the Fair Work Act, which lists both Dr Ryan and the Commonwealth as respondents.
Ms Rugg started working for Dr Ryan in August last year, after the independent ousted former treasurer Josh Frydenberg from the blue-ribbon seat of Kooyong at the federal election.
Court documents show Ms Rugg is alleging a breach of general protections under the Fair Work Act.
Ms Rugg confirmed the legal action in a phone call to ABC.
Dr Ryan told the ABC she was unable to comment on the matter.
Ms Rugg is the former executive director of Change.org and campaign director at GetUp! and she played a leading role in the yes campaign for same-sex marriage.
She joined Dr Ryan's team as chief of staff in August last year, with the MP saying in a newsletter posted on her website that she was "delighted" to announce Ms Rugg's appointment.
"Sally is an outstanding all-rounder with excellent leadership experience, a proven track record of effective policy advocacy, and high level strategic communications skills," Dr Ryan wrote.
Ms Rugg tweeted "best first-week-of-a-new-job ever" on July 28, resharing a Twitter post showing Dr Ryan's first speech to parliament. She still remains a member of Dr Ryan's staff.
Dr Ryan, a qualified paediatric neurologist and former director of neurology at Melbourne's Royal Children's Hospital, is a first-term parliamentarian elected as part of the "teal" or community, independent, grassroots campaigns.
An initial hearing on the matter will be heard at the end of the week.
