The Service NSW website said border community residents "must self-isolate for 14 days immediately after entering NSW if (they) have travelled within Victoria outside a border community".
People who are "critical service workers" or require medical care fall under a different category.
But Barooga resident Grant Tarrant, who is the Shepparton RSL's general manager, said he was only eligible for the `Cross-border resident (within 50 km of border)’ permit.
As he has to travel to Shepparton for work, which is not a border town, it means he has to self-isolate when returning home, according to his permit.
Mr Tarrant said he spoke to Service NSW and was told to carry documentation proving he worked in Shepparton.
But then Mr Tarrant spoke to border control at the Victoria-NSW border and was told he wasn't allowed to travel to Shepparton without self-isolating afterwards.
Mr Tarrant said he would try to work from home in the meantime, but it would make things difficult.
“(The RSL has) been closed and then partially open, and our staff has been under stress with JobKeeper,” he said.
“If any business needs leadership, it's our business.
“But it doesn’t look like I’ll be going anywhere until the border is relaxed.”
He is not alone — about 90 Greater Shepparton workers live in NSW according to the 2016 census.
Federal Member for Nicholls Damian Drum also has an employee from Tocumwal who was told she had to self-isolate after returning home from Shepparton.
“There are a whole range of employees around Shepparton who are getting caught up in this because they reside in NSW towns like Moama or Tocumwal,” Mr Drum said.
“It's a ridiculous aspect of the permit system.
“We just need people to go about their daily ways,” Mr Drum said.
A NSW Health spokesperson did not answer specific questions, but said people entering NSW generally would have to obtain an entry permit and "comply with the conditions of the permit or specific conditions in the order".
For example, "returning NSW residents have to self-isolate for 14 days from the time they were last in Victoria".
“The reasons for each permit will differ, and Police Local Area Commands use their knowledge and understanding of local areas in assessing these applications.”
NSW Police said the matter was for NSW Health.
People who don't comply with border rules face an $11,000 fine and six months jail.
NSW Premier Gladys Berejiklian urged border community residents to avoid travelling unless it was "absolutely necessary".
“The probability of contagion in NSW given what's happening in Victoria is extremely high,” she said.
“Do not move outside your border community unless it is absolutely necessary.”
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