Hi! I'll be glad to be of help with this issue.
I can imagine how frustrating and distressing this situation must be for you. You are clearly a loving caring man and she is equally loving and caring. And so this situation is so charged with threats to your relationship that it is indeed very dangerous.
And this is actually the key to my answer to you that you need to consider and think about. The question is not whether you trust your partner or not. We agree that you trust her and she trusts you. However, we also agree that if you were working every day "essentially alone" with an attractive woman in her late 20s and would be going out drinking and subsequently you'd be traveling with her that it is not a question of trust any longer. What is it?
It is a question of predators getting their prey. We are all susceptible to the flattery, the impulsiveness, the bad moods that can make us do things that would hurt our partners. Everyone is susceptible. Clergymen and clergywomen are susceptible. Everyone. And you know that in your heart. And I imagine if she would be willing to be honest and were thinking about the above scenario where you would be in that situation with a woman who flashed her cleavage at you every week, your partner would also agree.
I want to bring up a troubling aspect of how your partner is approaching this: "She suspects that his feeling are possibly genuine (if misguided) rather than cheap, which if true makes the situation of even more concern. Poor behavior is much easier to deal with than genuine feelings."
And you've bought into this dangerous opening. He might have the most genuine feelings of affection and desire to have her as his own partner. How does that make this not poor behavior as much as if he just wants to seduce her? In the reverse situation: your hypothetical supervisor might want to move in with you and have a genuine relationship; does that make her behavior not bad behavior given that you're in a relationship already and have made visible signs you are not welcoming her advances?
In the US and I believe from what I've heard it's true in Australia as well, his behavior toward your partner is sexual harassment and she even has witnesses. This is a terrible situation you're in. She needs the job, but she is causing you great pain by allowing a man to be intimate with her in inappropriate ways without filing a complaint. And she's asking to travel with him and to go drinking with him. It is indeed a violation of monogamous relationships. This is WHY the sexual harassment laws are as stringent as they are! Because it is recognized that this is a problem, not just your lack of trust, but a real workplace problem.
I hope you two will read my answer together, because she sounds like a wonderful person: he after all, is trying to get her away from you. I believe that relationships trump jobs. And so if speaking to the HR department or the ultimate boss about her need to be transferred to a different supervisor or else she will have to file a sexual harassment claim with the authorities is what I would recommend. But I can't speak for you or her. You two need to decide how you feel about this threat that is occurring throughout the world in the workplace. A real threat that has engendered very strict laws making it illegal to do what he is doing.
Okay, I wish you the very best!
My goal is for you to feel like you've gotten Great Service from me and the site. If we need to continue the discussion for that to happen, then please feel free to reply and we'll continue working on this. If the answer has given you the help you need, please remember to give a rating of 5 (Great Service) or 4 (Informative and helpful), or even 3 (Got the job done) button. This will make sure that I am credited for the answer and you are not charged anything more than the deposit you already made by pressing any of these buttons. Bonuses are always appreciated! If I can be of further help with any issue now or in the future, just put "For Dr. Mark" in the front of your new question, and I'll be the one to answer it. All the best, XXXXX XXXXX