Unions welcomed the pay rise for teachers
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More than 10,000 teachers in Northern Ireland are to receive a pay increase.
Education Minister Angela Smith said £6.5m would be invested, with pay rises backdated to 1 April this year.
She said the salary increases would benefit teachers who are due to progress to point 3 on the upper pay scale this September.
Frank Bunting of the INTO union, said: "This is a major step towards the return to parity with teachers' salaries in England and Wales."
Mr Bunting said educators had been "impressed" by the minister's "teacher-friendly approach and for her evident commitment to improving the conditions of service of teachers in Northern Ireland".
Mike Graves of the Ulster Teachers' Union said senior teachers were "at long last being rewarded for the hard work and dedication they are giving to Northern Ireland's schools".
Making the announcement on Monday, Ms Smith said: "With their planned pay progression from September 2005, these teachers' salaries will increase by £1,164 a year, bringing their annual basic pay to £32,628.
"Today's announcement backdates this pay increase to April 2005, which will mean almost £500 extra this year for each of these teachers."