A $264 million olive branch has been extended to NSW rail unions to end train safety concerns and avert more disruption to commuters.
The Rail, Tram and Bus Union has been locked in long-running negotiations with the government over safety modifications it wants on the $2.8 billion Korean-made intercity fleet.
Train drivers have been taking industrial action for months to pressure the government, which finally relented on Wednesday, agreeing to spend $264 million to upgrade the mothballed fleet.
Transport Minister David Elliott said a verbal agreement had been reached and he expected the union to end this week's industrial action.
"We have agreed to their (union) request for one agreement and all the original discussions and negotiations with regards to their allowances and pay have also been agreed to", he told reporters on Wednesday.
"The NSW government expects the union to terminate industrial action straightaway in the best interests of the commuters."
He said the settlement was reached so the train system can run smoothly once again without disruptions, noting "it's a small price to pay".
"The cost of modifying these perfectly good trains is a lot less than actually disrupting our economy and not having these trains running", Mr Elliott said.
However, the RTBU told AAP on Wednesday that no deal would be inked until it was received in writing and members could vote on it.
For now, the union vowed industrial action would go ahead until the end of the week.
Transport for NSW warned the union ban on driving foreign-owned trains on Friday would have a knock-on effect on Sydney Trains services, with a reduction of 70 per cent during peak periods expected.
The most recent dispute was sparked by a government offer to pay workers up to $18,000 to operate the fleet before safety modifications are made.
The union's NSW secretary Alex Claassens had accused the government of playing political games, calling that offer a bribe.
If the $264 million offer is accepted it would be one less problem for Dominic Perrottet's government, which has also been battling industrial action launched by the teachers union.
A historic 24-strike by NSW public and Catholic teachers is the result of the state government's failure to address chronic teacher shortages, unions say.
The action by 85,000 public and Catholic school teachers on Thursday will be the third strike in six months and is expected to affect about a million families, just a day before two weeks of holidays.
Thousands of teachers are expected to descend on Sydney's CBD after the budget revealed no more than a 3.5 per cent pay rise was on the table.
It's the first time in more than 25 years the NSW Teachers Federation and Independent Education Union NSW/ACT have joined forces to strike for 24 hours in a show of strength that will close schools.
"We have a crisis in the form of a teacher shortage, a crisis that is the government's own making," Federation President Angelo Gavrielatos told reporters on Wednesday.
"The government has known for years the causes of this crisis: uncompetitive salaries and unsustainable workloads.
"Students have been denied not only their learning opportunities but are also being denied their futures."
Mr Gavrielatos urged the government to retain teachers in the stretched sector by lifting wages by around seven per cent in order to keep up with inflation and living costs which have spiked in recent months.
"Teacher salaries have declined relative to other professions over the last 30 years ... our claim is clear based on an independent inquiry... recommending a five to 7.5 per cent increase per annum," he said.
