This is definitely a health hazard and should be part of the disciplinary process. This should be escalated to the immediate supervisor or department director. Begin with documenting what happens, the nurse should be informed of the issues, then if this is a true health problem, have documentation from her physician. If this cannot be obtained, then escalate the problem further with verbal warnings, written warnings, etc. These things can be handled without the threat of suit, but you must have the backing of administration and HR.