A sexual assault allegation that rocked the New Zealand Labour party has tarnished Jacinda Ardern's reputation and led to speculation that she could be forced to quit as prime minister.

A male Labour party staffer resigned after he was accused of assaulting a 19-year-old female volunteer and harassing other party members.

The teenager told The Spinoff that she was pinned down and sexually assaulted by the man in 2018.

Labour president Nigel Haworth also quit over the party's handling of the investigation.

Ms Ardern said she was not aware of the sexual assault claim until it was published in the media - but opposition leader Simon Bridges has claimed she knew about it earlier than that.

'I think she knew. All very well, it may be that the president is in the wrong, but when you think about this, the prime minister, if you stand back and look at it, is ducking and diving accountability,' he told Newshub.

New Zealand prime minister Jacinda Ardern is facing calls to quit as leader of the nation after her party was caught up in a sexual assault scandal

The question of whether Ms Ardern should have also been aware is now central to her political credibility. Pictured with her partner Clarke Gayford and her baby Neve

'You have this in the media and indeed her being interviewed about alleged sexual assaults for several weeks now... I think she knew and she is saying she didn't.'

Mr Bridges said Mr Haworth was the 'fall guy' for Ms Ardern, and claimed the prime minister had 'done the least possible every step of the way - it's just wrong'.

Political commentator Duncan Garner said Ms Ardern could be forced to stand down as prime minister.

'Ms Ardern has squandered a massive lead - like a racing car driver a lap ahead crashing into the side wall. I simply can't say with certainty if Ms Ardern is going to walk away from this mass pile up,' he wrote for Newshub.

'I can't rule out that she may be forced to resign as prime minister.'

The allegations were given a public airing last month when the complainants took their grievances to opposition MP Paula Bennett after Labour's investigation exonerated the staffer

Labour president Nigel Haworth (pictured) quit over the party's handling of the investigation

On Thursday the man accused of digitally raping the teenage Labour volunteer and harassing other party members followed Mr Haworth in leaving his post.

'I adamantly refute the serious allegations made against me,' the staff member to Ms Ardern said in a statement issued by his lawyer.

'(I) have made the very difficult decision to resign because of the stress of the situation, and my wish not to be a distraction to the work of the Government.'

The man's lawyer reiterated his client's innocence, and noted that the 'continued litigation by media' was taking a severe toll.

Political commentator Duncan Garner said Ms Ardern could be forced to stand down as prime minister. Pictured with her partner Clarke Gayford

Ms Ardern said she was not aware of the sexual assault claim until it was published in the media - but opposition leader Simon Bridges claimed she knew about it earlier than that. Pictured with Scott Morrison

The prospect of that media storm going away appears remote given the anger that the alleged victims feel, and their involvement of the opposition National Party.

The allegations were given a public airing last month when the complainants took their grievances to opposition MP Paula Bennett after Labour's investigation exonerated the staffer.

While Mr Haworth and the investigative panel maintained the complaints did not include a serious sexual assault, an email trail produced in media reports suggested otherwise - and forced his resignation.

The question of whether Ms Ardern should have also been aware is now central to her political credibility.

The prime minister, who has campaigned at the United Nations on strengthening the Me Too movement against sexual violence, says she was not told of the nature of the allegations when she inquired about them, and escalated the issue when she discovered it was so.

Ms Bennett said Ms Ardern stood exposed as a hypocrite.

'This goes right to the heart of the kind of leadership she wanted to display,' Ms Bennett said.

Last month, Ms Ardern appointed a Queens Counsel - named by the New Zealand Herald as Maria Dew QC - to look into the party's investigation process and the sex abuse allegations.

Political commentator Duncan Garner said Ms Ardern could be forced to stand down as prime minister

The besieged Labour Party has placed its trust in Ms Dew to find a resolution to the damaging affair.

In another development, Stuff reports that one of the Labour panel charged with investigating the allegations - senior vice president Tracey McLellan - stands to inherit Mr Haworth's post as president.

That move comes despite Ms Ardern attacking the party's investigation as 'completely inappropriate'.

Ms Ardern said the move was 'very temporary' ahead of next month's Labour conference when a new president will be elected.