The NSW Industrial Relations Commission on Friday awarded a special allowance to the state's public psychiatrists, providing a 20 per cent pay bump for 12 months.
Commission Vice President David Chin said the special case justified a temporary allowance to attract and retain staff specialists.
"There is an acute shortage of psychiatry staff specialists ... which is causing a deterioration in the quality of public healthcare delivered in NSW," he said.
The payment of the allowance will be absorbed into any subsequent salary increase.
Justice Chin specifically noted the allowance was not a reward for the industrial strategy of threatening mass resignations.
The psychiatrists have previously fought for a one-off, 25 per cent pay rise, arguing that their comparatively lower pay against other jurisdictions and in the private sector have created staff shortages in NSW.
More than 200 of the state's psychiatric cohort threatened to resign, with more than 60 following through, while another 70 shifted from staff jobs to potentially more lucrative visiting roles.
Even before the mass resignations, more than 140 of NSW's 433 public hospital psychiatrist roles were vacant.
The state government has conceded the mental health system has been underfunded, but baulked at the union's demand for the one-off pay increase.
It had argued the specialists were well paid compared with other health workers and said the state budget was already stretched thin.
The public health system was effectively subcontracting psychiatric care to short-term consultants through an increasing reliance on locums and visiting medical officers, a barrister for the Australian Salaried Medical Officers Federation previously told the IRC.
The government spent more than $43 million recruiting locum doctors in each of the previous two financial years.
A staff specialist psychiatrist's base salary starts at $186,241, topping out at $250,000 for experienced doctors.
The resignations heaped pressure on the public health system, with some patients with mental health problems being given beds in general wards.
Mental Health Minister Rose Jackson told an August budget estimates hearing the commission's decision would be implemented as quickly as possible, but acknowledged no funding had been specifically allocated in the state budget.
"We will have to make provision for that and manage that once the commission has made a determination," she said.
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