NSW Police have begun relocating 366 people quarantined in a Sydney hotel to "more suitable" accommodation after it was found not to be complying with health standards.
Hotels in the quarantine program must have robust infection control measures with personal protective equipment to be properly used by staff including security guards and police.
Police said hotels that do not meet the expectations of the COVID-19 quarantine program are "rotated out" of the roster.
Travelodge Hotel Sydney was on Tuesday found not to be meeting those expectations, with the relocation operation expected to take about 12 hours.
It comes as NSW Premier Gladys Berejiklian backed the state's hotel quarantine system despite a coronavirus-positive security guard being fined twice for failing to isolate while waiting for his test results.
Ms Berejiklian says the process is monitored by police daily and audited regularly, but noted no system is foolproof.
She says she will take action if any systemic issues are identified, but the advice she has received is that the system should remain and is sound.
The 22-year-old male security guard was fined $2000 for visiting Westfield Burwood after his test on Thursday and Burwood's Service NSW building on Friday afternoon.
The Campsie man was on Saturday confirmed as the second Marriott hotel security guard to catch the virus, and was fined on Sunday.