Sydney commuters are being warned of more chaos as they try to head home on Friday, with Australia’s busiest suburban rail network again hit by industrial action.

Commuters were warned to avoid unnecessary travel as 90 per cent of services were cancelled on Friday morning after a previously undiscussed payment to entice rail workers to seal a long-term deal emerged as a new sticking point in negotiations that have dragged on for months.

The protracted dispute between the NSW government and union officials had been on track for a resolution before going off the rails again, resulting in widespread staff absences.

The Minns government said many train drivers simply didn’t turn up to work on Friday, while the NSW rail union claimed they had been locked out.

Transport Minister John Graham said there was major disruption across the network.

“We’ve had more than 350 services cancelled [by 7.30am] this morning and that is having a big impact across the network,” he told Sydney radio 2GB.

“We’re obviously, though, not paying people to take industrial action.”

By Friday afternoon, Transport for NSW said that had grown to more than 800 cancelled services and nearly 400 delayed.

“[Some] 576 Sydney Trains and NSW TrainLink train drivers and guards did not report for their normal shifts as of 2pm, and this number is growing throughout the day,” it said.

“As a result of these absences, more than 90 per cent of this morning’s peak services were either delayed or cancelled.”

The Rail, Tram and Bus Union told members that industrial action involving operating trains at slow speeds would begin on Friday morning after negotiations fell over “at the final hurdle”.

It said Transport for NSW had been asked to withdraw what the union described as “lockout notices” to allow the go-slow action.

The ABC and other media are reporting a text message signed by an RTBU convenor that was much more blunt:

“If you can afford to take the hit to your pay you don’t have to show up to work at all,” it read.

“Let’s f–k the network up.”

But NSW secretary Toby Warnes said workers had not been directed to do anything and the union was simply advising them of their rights.

“We instructed our members what their rights were, what their obligations were, what would happen if they didn’t go to work. That’s what we do,” he said.

“None of these text messages would exist if the government hadn’t issued 5000 lockout notices to 5000 individual employees.”

On Friday, Transport for NSW urged commuters to check latest travel updates online before embarking on their journey.

Sydney Trains CEO Matthew Longland urged commuters to find alternate transport, especially if they were heading to the airport, while the company’s executive director rail operations, Jas Tumber, warned delays could extend into the weekend.

Negotiations broke down over a $4500 payment for workers. It was referred to as a “one-off” when included in the previous agreement, and had not earlier been discussed in the current negotiations.

The union offered to forgo the payment for a 1 per cent increase in pay for the agreement’s third year, which alerted the government to the presence of the clause, Warnes said.

However, the NSW government said the union asked for the payment at “the last hour”.

“This was never part of our offer, nor was it in the union’s counter-offer,” a statement said.

Union officials were initially pushing for a 32 per cent pay rise over four years. The Minns government has offered 15 per cent over the same period – including a federally mandated superannuation increase.

The union later provided a counter-offer of about 20 per cent over three years.

The rail network typically transports about a million people a day, who have faced repeated disruptions as negotiations dragged on.

Opposition transport spokeswoman Natalie Ward said the union was holding the city to ransom, accusing the government of failing to stand up to them.

“People are sick and tired of it, but they expect and deserve and have paid for a transport system,” she said.

Business Sydney executive director Paul Nicolaou said the poorly timed disruptions were sapping confidence in the city.

-with AAP