The young man is alleged to have raised his right hand in a salute and said "Heil Hitler" at a party function in September.

A formal complaint was made to the party and the man was issued with a show cause notice. The man later posted the letter online.

Canberra Liberals president John Cziesla confirmed the alleged incident took place at an ANU Liberal Club branch function.

He said the branch had not been affiliated with the Canberra Liberals for a decade however a complaint was made to the party on November 21.

He said the young man used to work for Canberra Liberals Assembly member James Milligan one day a week for three months on a temporary contract.

Liberals Andrew Wall and Candice Burch were thanked for attending the event on the ANU Liberal Club's website although Mr Cziesla could not confirm their presence and Mr Wall redirected questions to Mr Cziesla.

Mr Cziesla said the committee was finalising its preliminary investigation against the former staffer. The committee will then make a recommendation whether to proceed to disciplinary action, which could range from a reprimand to expulsion.

He said the offence was viewed so seriously there could be grounds for expulsion.

"We view this behaviour as totally and utterly unacceptable. We have zero tolerance for people doing this," Mr Cziesla said.