diff --git a/src/client.js b/src/client.js
index 86ee232e8..d87ec2441 100644
--- a/src/client.js
+++ b/src/client.js
@@ -228,6 +228,30 @@ function MatrixClient(opts) {
     this._serverSupportsLazyLoading = null;
 
     this._cachedCapabilities = null; // { capabilities: {}, lastUpdated: timestamp }
+
+    // The SDK doesn't really provide a clean way for events to recalculate the push
+    // actions for themselves, so we have to kinda help them out when they are encrypted.
+    // We do this so that push rules are correctly executed on events in their decrypted
+    // state, such as highlights when the user's name is mentioned.
+    this.on("Event.decrypted", (event) => {
+        const oldActions = event.getPushActions();
+        const actions = this._pushProcessor.actionsForEvent(event);
+        event.setPushActions(actions); // Might as well while we're here
+
+        // Ensure the unread counts are kept up to date if the event is encrypted
+        const oldHighlight = oldActions && oldActions.tweaks
+            ? !!oldActions.tweaks.highlight : false;
+        const newHighlight = actions && actions.tweaks
+            ? !!actions.tweaks.highlight : false;
+        if (oldHighlight !== newHighlight) {
+            const room = this.getRoom(event.getRoomId());
+            if (room && !room.hasUserReadEvent(this.getUserId(), event.getId())) {
+                const current = room.getUnreadNotificationCount("highlight");
+                const newCount = newHighlight ? current + 1 : current - 1;
+                room.setUnreadNotificationCount("highlight", newCount);
+            }
+        }
+    });
 }
 utils.inherits(MatrixClient, EventEmitter);
 utils.extend(MatrixClient.prototype, MatrixBaseApis.prototype);
@@ -2299,28 +2323,11 @@ function _membershipChange(client, roomId, userId, membership, reason, callback)
  * Obtain a dict of actions which should be performed for this event according
  * to the push rules for this user.  Caches the dict on the event.
  * @param {MatrixEvent} event The event to get push actions for.
- * @param {boolean} ignoreCache True to skip the cache and recalculate the push rules.
  * @return {module:pushprocessor~PushAction} A dict of actions to perform.
  */
-MatrixClient.prototype.getPushActionsForEvent = function(event, ignoreCache = false) {
-    if (!event.getPushActions() || ignoreCache) {
-        const oldActions = event.getPushActions();
-        const actions = this._pushProcessor.actionsForEvent(event);
-        event.setPushActions(actions);
-
-        // Ensure the unread counts are kept up to date if the event is encrypted
-        const oldHighlight = oldActions && oldActions.tweaks
-            ? !!oldActions.tweaks.highlight : false;
-        const newHighlight = actions && actions.tweaks
-            ? !!actions.tweaks.highlight : false;
-        if (oldHighlight !== newHighlight && event.isEncrypted()) {
-            const room = this.getRoom(event.getRoomId());
-            if (room) {
-                const current = room.getUnreadNotificationCount("highlight");
-                const newCount = newHighlight ? current + 1 : current - 1;
-                room.setUnreadNotificationCount("highlight", newCount);
-            }
-        }
+MatrixClient.prototype.getPushActionsForEvent = function(event) {
+    if (!event.getPushActions()) {
+        event.setPushActions(this._pushProcessor.actionsForEvent(event));
     }
     return event.getPushActions();
 };
diff --git a/src/models/event.js b/src/models/event.js
index 823ced97f..025ec9619 100644
--- a/src/models/event.js
+++ b/src/models/event.js
@@ -471,6 +471,14 @@ utils.extend(module.exports.MatrixEvent.prototype, {
             this._retryDecryption = false;
             this._setClearData(res);
 
+            // Before we emit the event, clear the push actions so that they can be recalculated
+            // by relevant code. We do this because the clear event has now changed, making it
+            // so that existing rules can be re-run over the applicable properties. Stuff like
+            // highlighting when the user's name is mentioned rely on this happening. We also want
+            // to set the push actions before emitting so that any notification listeners don't
+            // pick up the wrong contents.
+            this.setPushActions(null);
+
             this.emit("Event.decrypted", this, err);
 
             return;
diff --git a/src/models/room.js b/src/models/room.js
index 15477a9c5..3bc58ccc5 100644
--- a/src/models/room.js
+++ b/src/models/room.js
@@ -1424,6 +1424,39 @@ Room.prototype.getEventReadUpTo = function(userId, ignoreSynthesized) {
     return receipts["m.read"][userId].eventId;
 };
 
+/**
+ * Determines if the given user has read a particular event ID with the known
+ * history of the room. This is not a definitive check as it relies only on
+ * what is available to the room at the time of execution.
+ * @param {String} userId The user ID to check the read state of.
+ * @param {String} eventId The event ID to check if the user read.
+ */
+Room.prototype.hasUserReadEvent = function(userId, eventId) {
+    const readUpToId = this.getEventReadUpTo(userId, false);
+    if (readUpToId === eventId) return true;
+
+    if (this.timeline.length
+        && this.timeline[this.timeline.length - 1].getSender()
+        && this.timeline[this.timeline.length - 1].getSender() === userId) {
+        // It doesn't matter where the event is in the timeline, the user has read
+        // it because they've sent the latest event.
+        return true;
+    }
+
+    for (let i = this.timeline.length - 1; i >= 0; --i) {
+        const ev = this.timeline[i];
+
+        // If we encounter the target event first, the user hasn't read it
+        // however if we encounter the readUpToId first then the user has read
+        // it. These rules apply because we're iterating bottom-up.
+        if (ev.getId() === eventId) return false;
+        if (ev.getId() === readUpToId) return true;
+    }
+
+    // We don't know if the user has read it, so assume not.
+    return false;
+};
+
 /**
  * Get a list of receipts for the given event.
  * @param {MatrixEvent} event the event to get receipts for