A high-rise residential tower is causing problems for Fairfield Council after the developers laid an eighth-floor concrete slab without permission.

The council is now allowing the development, known as Linbar Towers, to go ahead because it does not want a fight in the Land and Environment Court.

The council approved the construction of two extra units and to retain half an illegally laid slab at Tuesday night's council meeting.

A decision contradicts council officers original recommendations to demolish half of the slab.

Mayor Nick Lalich said he didn't want the slab demolished because it would put "financial hardship" on the developer.

He said that while he was not in support of the illegal construction he thought the developers had had a harsh enough penalty imposed on them already.

"At the end of the day, we've looked at it and they've done the wrong thing. They've been closed down now [since May] and they are losing thousands of dollars already," he said.

Linbar Towers developer, Equipped Constructions, said the type of construction used for the building meant it would be impossible to remove the slab without massive renovations to the entire building.

"It is our understanding that council officers were unaware that the subject slab was constructed using post tension techniques, and with that knowledge now available, efforts are being made to ensure a workable and practical resolution is achieved for all parties," a spokesman said.

Cr Thang Ngo said the developers should face the full consequences.

"If we let this one go, what we are saying is, any developer can come in and build whatever they want, without permission and we will approve it," he said.

"That's not right. The developer built the concrete slab without permission and should have known the ramifications."

This is not the first time the council has made exemptions for the Linbar Towers development.

The council already approved the original development which exceeded both building height and the floor space ratio required by the council's own development control plan.

The council then had to deal with contradictory reports from the developer and other officials regarding overshadowing from the ninth floor.

The developer was also allowed to construct a loading bay below the minimum Australian standards so the building was below 25 metres and did not need to have a sprinkler system.

Mayor Lalich said he is "100 per cent sure" they will not win the case if it goes to court.

"In my 20 years on council I have never seen a case like this win," he said.

"Our courts are so weak. They don't impose a heavy enough fine.