Two families have been left traumatised after their children were mixed up at a Sydney childcare centre, with one baby sent home with the wrong family for hours.

On Monday, a mother went to collect her child from First Steps learning centre in Bangor only to be told that her one-year-old had “already been taken” by a man hours earlier.

After reviewing security footage, it was discovered that a grandfather of another baby was given the wrong child.

He didn’t realise and was equally disturbed by the mishap.

Former First Steps employee Annabelle Murray told 9News the incident “was catastrophic and could have been so much worse”.

“That’s what scares the life out of me, is you had no idea who that man was,” Murray said.

“He could have been anybody. It’s just so lucky that he brought the baby back,” she continued.

Parents and former employees are all furious over the enormous lapse in protocol.

“You just ring the doorbell and you’re let in,” said a mother.

“Their policy says they need to ask who’s at the door, what your name is, and who you’re picking up, and they never did that,” she continued.

First Steps learning centre has apologised in a letter to parent and has promised to strengthen their drop-off and pick-up protocols.

The letter also reveals the educator involved in the mix-up has been stood down following the incident.

“This Educator has been provided thorough induction training and is aware of the policies and processes regarding drop off and pick up. We have made the decision not to allow her back to the Bangor Service,” the letter reads.

“We are working closely with Department of Education, Office of the Children’s Guardian and NSW Police, to investigate this incident and to consider whether there is the option to engage in further rehabilitation training. However, we can assure you this will not be at the Bangor Service.”