The assault happened while they were preparing for a parents' evening at the Auckland school.
But MacKay told the tribunal that as he passed the woman, she grabbed his hand and pulled it down between her legs.
She had worn a dress that was inappropriately short for a parents' evening, he said, as it was well above her knees. While they were setting up for the evening, she had "parted her legs and flashed her underwear".
The dress in question was shown to the tribunal, according to its written decision.
"The tribunal concluded that it was not inappropriately short for such an occasion, apparently falling to her knees or slightly above."
The tribunal said it preferred the complainant's evidence and ruled that, on the balance of probabilities, the assault happened as she had alleged.
"The conduct occurred in a school context on a school occasion. The inappropriateness of the conduct in this context would be breathtaking even if the conduct had been consensual. But the tribunal has found it was not consensual."
The case, which went to a hearing in November, had been delayed by MacKay's application for a stay. The tribunal declined and MacKay went to the High Court for a judicial review, but this, too, was unsuccessful.
A complaint was also made to the police and the female teacher was interviewed but the police declined to prosecute.
MacKay and his family shifted to New Zealand from South Africa in 2001.
He told the tribunal he was acquitted in South Africa of charges arising from the claims of a student, who had a crush on him, that he had sexually molested her, trying to kiss her and touch her leg.
The exact nature of the charges was not explained to the tribunal.
The female Pakuranga College teacher reported that MacKay's assault had a devastating effect on her; she was diagnosed with post-traumatic stress disorder and she had a prolonged period of counselling by a psychotherapist.
One witness described MacKay as a passionate and committed teacher who was loved by his students. Another said he was one of the most giving teachers and a natural leader.
The tribunal said that, given MacKay's talents, "should he apply for re-registration in the future, such application should be given positive consideration if the Education Council of Aotearoa concludes that appropriate rehabilitation has occurred".
"While it is a matter for the Education Council, the tribunal anticipates that the Education Council would not contemplate re-registering Mr MacKay unless he acknowledges his wrongdoing and undertakes to genuinely engage in appropriate remedial steps."