Chief executive Ross Dykes said it would be inappropriate to impose further penalties on the talented left-hander.
Ryder was dropped from the Black Caps test squad after it was revealed he went out drinking with team-mate Doug Bracewell on the eve of the first test against India earlier this month.
The pair were fined an undisclosed amount for breaching team protocol. Ryder has since been left out of the New Zealand squad for the ICC World Twenty20 and was passed over in the Indian Premier League auction.
Dykes last week told the Otago Daily Times both the association and Ryder needed some time to consider ''the way forward''.
Ryder remains off limits to the media but Dykes said Otago cricket would not be taking any action.
''Jesse's misdemeanour, or whatever you like to call it, was with New Zealand Cricket and they have taken the appropriate action on that. I think it would be inappropriate for Otago to try and take any further action,'' Dykes said.
''He will continue to play for us and we will continue to work with him and other people in cricket to see if we can get him back in the right space to compete for the Black Caps again.
''Everybody is very keen to see if we can make some progress but we all know it has to be done thoroughly. I think we just have to make hay slowly and quietly.''
Ryder is expected to be named in the Otago team for the Volts' final Plunket Shield match of the season against Northern Districts at the University Oval. The fixture gets under way tomorrow and Otago coach Vaughn Johnson will name the side today.
All-rounder Sam Wells is likely to miss the match with a side strain and seamer Jacob Duffy has been ruled out with an ankle complaint. They join a very long list of injured players but there is some relief as Black Caps Hamish Rutherford, Jimmy Neesham and Neil Wagner are likely to be available.
Johnson could not confirm whether they would be released yesterday but remained hopeful.
The game is effectively a friendly, as Canterbury is too far ahead to be overhauled. But Johnson said Otago, which is in second place, was determined to finish the campaign well.
Second would be a good result considering all the injury setbacks which had made ''getting the best team on the park particularly difficult this season'', Johnson said.
Black Caps wicketkeeper-batsman BJ Watling has been named in the Northern Districts side.
Watling combined in a world record sixth-wicket partnership with Brendon McCullum to help save the second test against India in Wellington earlier this week. He replaces Rory Christopherson.
Plunket Shield: University Oval, starts tomorrow
Otago (possible): Aaron Redmond, Hamish Rutherford, Michael Bracewell, Neil Broom, Jesse Ryder, Jimmy Neesham, Nathan McCullum, Derek de Boorder (captain), Mark Craig, Neil Wagner, Bradley Scott, Nick Beard.
Northern Districts: Daniel Flynn (captain), Graeme Aldridge, James Baker, Joe Carter, Jono Hickey, Scott Kuggeleijn, Bharat Popli, Mitchell Santner, Ish Sodhi, Anurag Verma, BJ Watling, Brad Wilson.
