NSW will scrap the requirement for household contacts of people with COVID-19 to isolate from 6pm Friday.
Business leaders have been calling for the end to the seven-day isolation rule, saying it will ease staff shortages for businesses trying to recover from the pandemic.
On Wednesday, NSW chief health officer Dr Kerry Chant said while the nature of contact within a household posed a "significant risk" for transmission, the state was putting in a range of risk mitigation measures instead of the current "strict" household contact rules.
Instead of household contacts having to isolate for seven days, Dr Chant they were asking them to follow some "simple guidelines".
"They will now have a more permissive set of requirements," she said.
"We are asking them to wear masks in indoor spaces, to work from home if possible, and to use rapid antigen testing to mitigate further risk.
"We have to co-exist with COVID, but it doesn't mean we can ignore COVID. We can't ignore the flu.
"You never say never with COVID... We will continue to watch the circumstances as they unfold and respond accordingly."
From 6pm Friday, people who are household contacts of a person with COVID-19 are asked not to visit aged care, hospital, disability, and correctional facilities; to wear a face mask in indoor settings outside the home; to undertake daily RATs before coming into close contact with people outside their household; to avoid contact with elderly and immunocompromised persons where possible; to work from home where practical; and to notify their employer/educational facility that they are a close contact.
It comes after another COVID-19 related death in the Hunter, with a Lake Macquarie woman in her 70s dying with the condition in the 24 hours to 4pm on Tuesday.
The Hunter New England region has recorded another 2,069 new cases, the highest number of positives in the state.
These were identified by 448 PCR tests, and another 1,621 positive rapid antigen tests reported to NSW Health.
There are now 84 COVID-19 positive patients receiving care in hospitals across Hunter New England local health district, and three in intensive care.
It comes as NSW recorded 15,414 new cases - with 10,311 positive rapid antigen tests (RATs) and 5,103 positive PCR tests.
There were 15 COVID-related deaths reported in the 24 hours to 4pm Tuesday, including eight men and seven women.
One person was aged in their 40s, one person was aged in their 60s, five people were in their 70s, five people were in their 80s and three people were in their 90s.
NSW Health said of the two people who died under the age of 65, one person had received two doses of a COVID-19 vaccine and one person was unvaccinated. Both had underlying health conditions.