Commuters across NSW can breathe a sigh of relief after the state government struck a pay deal with the combined rail unions, ending the bitter dispute that repeatedly brought the train network to its knees.

The warring parties reached an agreement this afternoon in the Fair Work Commission, under which workers will receive a 12 per cent pay rise over three years.

While an increase on the government’s initial offer of a 9.5 per cent raise, the final figure is well short of the 32 per cent over four years the combined unions had argued for and has sparked anger from the Electrical Trades Union.

The agreement will put an end to the bitter negotiations and strikes that caused major disruptions to the Sydney rail network and at one point even threatened to lead to the cancellation of the city’s New Year’s Eve fireworks.