An investigation has been launched and a childcare educator has been stood down after a grandparent mistakenly picked up and took home the wrong toddler from a Sydney daycare centre.

The grandfather arrived to collect his grandchild from First Steps Learning Academy in Bangor on Monday afternoon, only to reportedly be given the wrong child.

The man unwittingly took the child, who was sleeping at the time, home with him. The mistake was only realised when the boy’s mother showed up at the centre to collect him and found he was not there, the Sydney Morning Herald reported.

“I can’t explain the feeling,” the mother told the newspaper of learning her one-year-old had been collected by a man she didn’t know.

“We don’t blame him. We are not angry with him. We are not upset at him – we blame the daycare.”

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The grandfather’s wife told the Sydney Morning Herald her husband was “devastated” by the mistake and “raced [the] child back so fast” when he realised he had the wrong boy.

“I am just so glad the little boy was OK,” she said, adding her husband had arrived at the centre when the children were sleeping and the room was dark.

New South Wales’ Early Childhood Education and Care Regulatory Authority said it was conducting a “thorough investigation” into the “deeply concerning and serious incident”.

The authority said an educator had been stood down by the daycare centre while the matter was investigated.

“The … regulatory authority investigation will consider the service’s compliance history,” the regulator said, adding NSW police had been notified. NSW police said it did not have any record of a police investigation.

Trisha Hastie, the approved provider of First Steps Learning Academy, issued an apology to the families for the distress caused by the incident – which she said was “isolated”.

“This has never happened before at Bangor, or at any of our other centres,” Hastie said in a statement on Thursday.

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“While we have always maintained strict protocols for drop-off and pick-up, in this case, those processes were not followed correctly. The educator involved has been stood down.

“We have acted immediately to strengthen our procedures and ensure this never happens again.”

The incident comes at a time of intense scrutiny of the early childhood sector in Australia.

There have been disturbing allegations of abuse and neglect of children across Australian childcare centres in recent months, leading to government reviews of the sector in both NSW and Victoria.

A suite of legislative changes has been announced by state and federal governments, aimed at improving safety standards in the sector.

There have been no allegations of abuse or neglect directed at First Steps Learning Academy in Bangor.