Three councillors have asked department chief executive Ross Woodward to investigate an alleged breach of the Local Government Act over the council's handling of the restructure, which was approved by a majority of councillors despite the lack of a financial evaluation of possible costs.

The appeal comes as the council waits for a final report by the department after a section 430 investigation in 2008 that was highly critical of council operations.

"We are concerned that Cessnock council is not observing its statutory responsibilities and as a result will lose the community confidence it has been struggling to build since the section 430 report," councillors James Ryan, Cordelia Burcham and Chris Parker wrote in their letter to Mr Woodward.

Cr Ryan said he had also raised concerns about arrangements for the councillors' Christmas party that included a luxury guesthouse offer of "a discounted accommodation rate for anyone that wishes to stay overnight".

"We've had a section 430 report that showed the councillors did not understand the nature of gifts and benefits in relation to their obligations, and we receive advice from the council like this," Cr Ryan said.

"It sounds to me like our culture has not changed much at all."

Cessnock mayor Alison Davey defended the council's handling of the restructure this week. She said it was expected to be financially neutral and had been positively received by staff and the union involved.