Some fire stations in Sydney will temporarily shut for a day so firefighters can fill shortages elsewhere.
Fire & Rescue NSW Commissioner Greg Mullins said on Monday the plan would begin immediately after the Fire Brigade Employees Union rejected other proposals to reduce costs caused by high levels of sick leave and absenteeism.
"With just one third of the financial year gone, nearly 70% of the $A10 million 2012/13 overtime budget has already been spent," Mr Mullins said in a statement.
"So I have decided to take steps to reduce the blow-out in overtime by extending our long standing practice of moving fire fighting resources between fire stations in a responsible way."
AAP reports up to eight Sydney fire stations will temporarily shut for a day so that firefighters can fill shortages elsewhere.
Mr Mullins said these arrangements would be in place only when minimum safe crewing levels were not being met because of firefighters taking sick or other unplanned leave.
The plan was originally been scheduled to take effect in August before it was suspended to allow discussion of alternative cost-saving measures.