Union representatives and health officials agree that the pay increase is crucial to attract and retain psychiatrists, who are underpaid compared to other states, and to help mitigate the ongoing mental health crisis worsened by low pay and poor working conditions.

The New South Wales Industrial Relations Commission has ordered a 20% pay increase for public hospital psychiatrists following a prolonged dispute with NSW Health, which involved mass resignations and concerns over mental health services deterioration.

This ruling is a temporary measure while negotiations continue on a three-year pay award for all medical staff, with hearings scheduled for November and a decision expected next year.

Justice David Chin described the 20% increase as a modest, temporary solution aimed at addressing workforce shortages and preventing further decline in mental health care quality, noting it would not affect other health workers.

Mental Health Minister Rose Jackson welcomed the decision, emphasizing its importance in stabilizing the mental health workforce and improving services across NSW.

The dispute was sparked when psychiatrists rejected a proposed 10.5% pay rise over three years, with over 150 doctors threatening to strike and up to 200 considering leaving, highlighting a severe workforce crisis.

The NSW Industrial Relations Commission initially ordered an interim 12-month pay bump, which combined a 10% attraction and retention allowance with an existing 10% 'abnormal duties allowance,' totaling a 20% increase.