NSW has recorded 276 COVID-19 cases and no deaths as the state government's COVID-19 cabinet subcommittee meets to consider if a mask mandate will be extended beyond December 15.
The government's roadmap out of lockdown says restrictions will ease when NSW reaches 95 per cent double vaccination or on December 15, whichever comes first.
That's when the lockout of unvaccinated people will end and masks will be required only on public transport, planes and airports and for indoor front-of-house hospitality staff.
However, there are reports NSW Health bureaucrats are pushing to keep masks mandatory in shops during the entire festive season.
It comes as a backpacker hostel at Byron Bay is placed into a week-long lockdown after a virus case was identified, days before thousands of celebrating school leavers are due to arrive in the region.
Meanwhile, unvaccinated year 12 students have been granted an exemption to attend formals, dinners, or graduations.
Health Minister Brad Hazzard said the 2021 cohort "had an incredibly tough 18 months".
"They deserve to be able to party with their friends and enjoy one of the biggest celebrations of their life," he said on Thursday.
The exemption means year 12 students who have not been vaccinated for COVID-19 will be able to celebrate with their friends if they abide by the public health requirements of the venue they're attending.
Some 92.1 per cent of people 16 and over are fully vaccinated and 94.4 per cent have had one jab.
Most teenagers - 81.1 per cent - aged 12-15 have had their first jab, while 75.9 per cent of them are fully vaccinated.
NSW Health says there are 191 people with COVID in hospital, 31 of them are in intensive care and 10 are ventilated.
Australian Associated Press