Samuel Singh has won a hollow victory in his legal battle against his former Tax Office bosses after the Fair Work Commission found that his second dismissal from the Australian Public Service was harsh, unjust and unreasonable.

But it could not give him his job back, award him compensation or help with Mr Singh's continued grievances against the Taxation Office over the alleged bullying he suffered there, and federal workplace insurer Comcare which has stopped paying his sickness benefits.

Mr Singh was sacked in 2011 for refusing to return to work from sick leave when ordered by his bosses – the same offence that saw him shown the door three years earlier.

But the commission found a litany of mistakes by the ATO, not least agreeing to re-instate Mr Singh, instead of seeking other remedies, when he won his first unfair dismissal case against them in 2009.

The former senior auditor has been battling the ATO since 2006, claiming that bullying and harassment he suffered at the hands of colleagues at the Tax Office's building in Parramatta left him suffering from severe "adjustment disorder".

He joined the Tax Office in 2005 but had worked for only short periods since 2006, when he went off on sick leave for psychological problems.

After his first unfair dismissal win, Mr Singh went back to work, but lasted only two weeks before he was off sick again, never to return.

By July 2011, his bosses had had enough and sacked Mr Singh for the second time after he again refused to participate in a "return to work program".

But the commission found the ATO had erred in trying to force a sick man back into its workforce with a plan that was doomed to fail.

Commission Deputy President Anne Gooley accepted the Tax Office was in a difficult position trying to cope with Mr Singh's demands but still found it could have done better.

Ms Gooley wrote in her decision that advice from two psychologists had been available and could have been followed to avoid the mistakes made two years previously.

"I have some sympathy for Mr Singh's view that the ATO did not handle his return to work well," she wrote.

It knew that Mr Singh was in a fragile state and it knew that to return him to work in a non-accountancy position in 2011 was bound to fail.

"It knew this because it had failed in 2009."

But Ms Gooley also found that this time around there was no point in ordering the ATO to give Mr Singh back his job.

The public servant would have been discharged on medical grounds anyway and his treating psychologist advised that three months treatment would be needed before any return to work program could begin.

"I do not consider it appropriate in all the circumstances to reinstate Mr Singh," Ms Gooley wrote.

"It is clear that from his own medical report that he is still not fit to return to work."

Nor was compensation appropriate, the commission found, as Mr Singh had barely worked since 2006, he was not owed any back wages.

"I am also not able to resolve Mr Singh's sense of injustice at what he saw as bullying and harassment by ATO employees prior to 2006," Ms Gooley found.