The husband of a dinner lady who was warned that allowing a child a biscuit could be seen as grooming said she has had a "horrendous two years".
The local education body has been told to apologise for its handling of the investigation into the incident at the County Fermanagh primary school.
Pat Lavery had been asked by a pupil for a biscuit and she in turn asked a colleague to give one to the child.
Her husband said the school warned her that this could be seen as grooming.
The incident happened in May 2008 at St Mary's primary school in Brookeborough, but the details have just emerged.
Dinner lady, Mrs Lavery, who was a relative of the child, had to attend three meetings, firstly with the acting principal then two with the school principal.
One of the meetings with the principal lasted over an hour and he wanted her to attend a fourth.
Mrs Lavery decided to leave her job as she felt she had been subjected to a "grilling".
She made a complaint to the body responsible for education in the area, the Western Education and Library Board (WELB).
The NI Ombudsman Tom Frawley investigated the WELB's handling of the case.
His report found that the Board failed to address a complaint the Mrs Lavery made about her treatment "promptly and appropriately".
In a copy of the report, seen by local newspaper the Impartial Reporter, Mr Frawley said she had endured "gossip and rumours" over a period of two years.
'Shadow hanging over her'
Owen Lavery told the Talkback programme it had been "a horrendous two plus years" and that his wife had had "a shadow hanging over her".
He said that his wife had not been accused of grooming, but that the school said that his wife "could be seen by her actions as grooming a child."
Mr Lavery said that since the issue had been resolved his wife had returned to work at the school and stressed that the findings of the Ombudsman's report were directed at the WELB rather than the school.
As well as finding that the board did not deal with the issue appropriately, the Ombudsman found there was no proper protocol in place under which board employees could raise grievances about non-board co-workers.
Mr Lavery recommended a consolatory payment and said the WELB should make a written apology to his wife.
In a statement, St Mary's primary school said the issues between the individuals involved had been resolved using mediation through the Labour Relations Agency.
"A confidentiality agreement was signed by all parties involved so it would not be appropriate to comment any further," it said.
"We have not received a copy of the Ombudsman's report so we cannot comment on a report that we have not seen," it added.
The WELB said the board had noted the findings of the Ombudsman's report and was "presently actioning the recommendations".
In a statement, the board pointed out that "at no time did it consider this to be a child protection issue, if it had, then appropriate action would have been implemented immediately."
The chair of the Stormont Education committee Mervyn Storey said that while rules were there to protect children and staff this was a case of "political correctness gone too far".
"I think it's a sad situation that schools are "so boxed in because of legislation."
He is to also write to the Permanent Secretary of the Department of Education to address the lack of policy as a "matter of urgency".