"At this stage it's really the subject of an ongoing investigation but he's disgruntled about some employment issues with the restaurant," he told reporters.
He said it appeared the female staff member just happened to be rostered on at the time.
"There is nothing to indicate that any direct threats were made to her," he said.
But he added it would have been traumatic for her to be held hostage over such a long period time.
The woman, from Port Melbourne, was assessed by paramedics at the scene.
Staff and customers fled and called police when the man entered the restaurant carrying the weapon at 10pm on Sunday.
He made his way to a back store room where the 27-year-old staff member was and barricaded himself inside with her.
Police cleared the area and negotiated throughout the night to try to get the man to surrender.
A former Ludlow restaurant manager named Storm, also a close friend of the hostage, said she was in "utter shock" after hearing what had happened.
Sunday nights were usually pretty quiet at the restaurant, she said.
"She's a very strong woman, so hopefully she'll be coping alright," Storm told Fairfax radio.
"Nobody could imagine what it's like to be in a situation like that."
Storm said the incident would shake Melbourne's hospitality industry.
"I think this has changed everything for a lot of staff, at all of the venues in Melbourne," she said.
- AAP
