Payroll and Benefits Guide Ireland
Last updated: Mar 03, 2026
Contribution
| Employer | Employer Payroll Contributions | |
| 11.15% | Social Security (PRSI) (reduced to 8.90% where earnings are below the threshold of €527 EUR weekly) | |
| 1.5% | Pension | |
| 8.90% – 12.65%* |
Total Employment Cost |
| Employee | Employee Payroll Contributions | |
| 4.01% |
Social Security PRSI. Employees earning below €352 or less per week are exempt
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0.50%
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Universal Social Charge (USC) applied on salary up to €12,012 EUR
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2.00%
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Universal Social Charge (USC) applied on salary from €12,012.01 to €27,382 EUR
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3.00%
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Universal Social Charge (USC) applied on salary from €27,382.01 to €70,044 EUR
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8.00%
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Universal Social Charge (USC) applied on salary above €70,044.01 EUR
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| 11.00% | Universal Social Charge (USC) applied for Self-Employed income over €100,000 EUR | |
| 4.01%-11.00%* |
Total Employee Cost | |
| Employee Income Tax | ||
| Single or widowed, no children | ||
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20.00%
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On income up to 44,000 EUR
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40.00%
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On income in excess of 44,000 EUR
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| Married, one household income: | ||
| 20.00% | On income up to 53,000 EUR | |
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40.00%
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On income in excess of 53,000 EUR
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| Married, two household incomes | ||
| 20.00% | On income up to 53,000 EUR and additional 35,000EUR cap of the lower earner | |
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40.00%
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On income in excess of 53,000 EUR and additional 35,000EUR cap of the lower earner
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*Effective from 30 September 2025 a new mandatory Auto Enrolment (AE) Pension Scheme will be launched, applied on workers aged 23 – 60 years old earning €20,000 or more per year. Both the Employer and Employee will contribute 1.5% of the salary in addition to a state contribution of 0.5%. The new total contribution rates will be as follows:
- Employee PRSI contribution will increase from 4.1% to 4.2%.
- Employer PRSI contributions will be adjusted as follows:
- From 11.15% to 11.25% for employees earning over €496 per week.
- From 8.9% to 9% for employees earning €496 or less per week.
- Employees earning €352 or less per week will continue to be exempt from PRSI contributions.
- Opt-Out option for pension – Employees may opt out, but only after six months from their initial enrollment date.
Employer taxes
Employee taxes
Minimum Wage
General
Since 1 January 2025, the national minimum wage in Ireland is set at:
- Aged 20+: 13.50 EUR per hour
- Aged 19: 12.15 EUR per hour
- Aged 18: 10.80 EUR per hour
- Aged under 18: 9.45 EUR per hour
MINIMUM WAGE (PER MONTH)
Payroll
Payroll Cycle
Salaries are paid either on a weekly or monthly basis. Employers should pay employees by the last day of the month.
13th Salary
There are no provisions in the law regarding 13th salaries.
Authority Payments
|
Authority Payment |
Due Date |
Method |
|
PAYE/PRSI/USC |
14 of the following month |
Wire |
Working Hours
General
A full-time work week is typically 39-40 hours. Employers are responsible for ensuring that employees are given adequate rest.
A work week cannot exceed 48 hours on average over four months. In addition, employees should get 24 consecutive hours of rest in any period of 7 days, and this should normally follow on from one of the 11-hour rest periods already mentioned. As an alternative, the employer can provide two 24-hour rest periods in a week if it follows a week in which you did not get any 24-hour rest periods. Unless the contract states otherwise, the 24-hour rest period should include a Sunday.
Overtime
The law focuses heavily on ensuring employee safety by setting maximum limits on working time, regardless of whether the hours are ordinary or overtime (extra hours).
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Maximum Average Weekly Hours (Act Section 15): An employee cannot work more than an average of 48 hours per week. This is an average limit, not a strict weekly cap.
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Averaging Period: The 48-hour average is calculated over a reference period of four consecutive months for most employees.
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This period may be extended to six or twelve months for specific industries (e.g., security, tourism, hospitals) or by a Collective Agreement approved by the Labour Court.
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Daily and Weekly Rest Periods:
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Daily Rest: Employees are entitled to 11 consecutive hours of rest in every 24-hour period.
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Weekly Rest: Employees are entitled to 24 consecutive hours of rest in every seven-day period (following the daily rest period).
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Time Records: Employers are legally obligated to maintain detailed records of all hours worked by employees for three years to demonstrate compliance with the 48-hour average rule.
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Exemptions: The Act’s limits on hours and rest do not apply to employees who can control their own working hours (e.g., senior management) or specific professions (e.g., Gardaí, Defence Forces).
Overtime Compensation Rates
Overtime is defined as any work performed beyond the employee’s normal contracted hours. There is no legal requirement for an employer to pay a premium rate for these extra hours.
| Compensation Detail | Formal Governmental Requirement (Act/Law) | Notes |
| Minimum Pay Rate | No statutory minimum premium rate (e.g., 150%) is set for standard overtime. | The rate of pay, if any, is entirely dependent on the employment contract or a Collective Agreement for the relevant sector. |
| Compensation Floor | All hours worked, including overtime, must be compensated at a rate that is at least the National Minimum Wage (NMW). | Overtime premiums cannot be included when calculating if the employee meets the NMW hourly rate. |
| Contractual Obligation | If the contract specifies a premium rate (e.g., time and a half), the employer is legally obliged to pay it as it becomes part of the employee’s wages under the Payment of Wages Act 1991. | Many employers contractually pay 1.5 times or 2 times the regular rate, particularly for weekend work. |
| Time Off in Lieu (TOIL) | Compensation can be paid in cash or granted as time off in lieu, provided this arrangement is agreed upon in the contract. | The value of the time off must be equivalent to the pay entitlement. |
Sunday Work Entitlement (Statutory Minimum)
For work performed on a Sunday, the law does mandate a minimum benefit if the contract does not already provide one:
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Statutory Benefit: If the contract is silent on Sunday pay, the employee is legally entitled to one of the following minimum benefits:
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A reasonable allowance.
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A reasonable pay increase (premium).
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Reasonable paid time off in lieu.
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This benefit must be paid in addition to the employee’s normal pay.
Leave
Annual Leave (vacation)
An employee’s entitlement to annual leave or holidays from work is set out both in legislation and the employee’s employment contract.
The Organization of Working Time Act 1997 provides a basic annual paid leave entitlement of 4 weeks (20 working days), although an employee’s contract can provide for a higher amount.
Part-time workers’ entitlement is calculated as 8.00% of the hours worked, subject to a maximum of four working weeks per leave year.
PTO carryover
In Ireland, statutory annual leave cannot be forfeited. Unused leave may be carried over where the employee couldn’t take it (e.g., illness, maternity leave, or employer failure to allow leave). A blanket “use-it-or-lose-it” policy is not lawful for statutory leave, and unused leave must be paid out on termination.
Note:
- Atlas allows carryover
- People 2.0 has no carryover policy
Public Holidays
Public holidays that fall on the weekend are usually moved to a weekday as a day off in lieu.
| Date | Day | Holiday | Notes |
|---|---|---|---|
| 1 January 2026 | Thursday | New Year’s Day | Standard holiday |
| 2 February 2026 | Monday | St. Brigid’s Day | Standard holiday |
| 17 March 2026 | Tuesday | St. Patrick’s Day | Standard holiday |
| 6 April 2026 | Monday | Easter Monday | Standard holiday |
| 4 May 2026 | Monday | May Day | Standard holiday |
| 1 June 2026 | Monday | June Bank Holiday | Standard holiday |
| 3 August 2026 | Monday | August Bank Holiday | Standard holiday |
| 26 October 2026 | Monday | October Bank Holiday | Standard holiday |
| 25 December 2026 | Friday | Christmas Day | Standard holiday |
| 26 December 2026 | Saturday | St. Stephen’s Day | Standard holiday |
Sick Days
The law in Ireland mandates the right for workers to receive 5 days of sick pay per year from the first day of sickness, providing a medical certificate is presented by the 4th day of sickness:
- Sick days can be taken consecutively or non-consecutive days.
- Sick pay is paid by the employer at 70% of normal pay, up to a maximum of €110 daily.
- To be eligible for this benefit the worker must be employed for at least 13 weeks before they can claim statutory sick pay.
- Companies can choose to offer more generous sick pay policy.
- This new entitlement is part of a wider 4-year phased sick pay legislation as follows:
- From 2025 – 7 days sick pay entitlement was expected but is currently on pause.
- From 2026 – 10 days sick pay entitlement
Maternity Leave
Mothers are entitled to take a total of 42 weeks maternity leave. This is broken down as 26 weeks (156 days) of ordinary maternity leave with some pay where eligible through PRSI (24 weeks for adoption), followed by the right to immediately take an extra 16 weeks of unpaid additional maternity leave.
Mothers must take at least two weeks before the expected birth and at least four weeks after.
The entitlement for paid leave during the first 26 weeks maternity is dependent on whether the worker has contributed enough to Social Insurance (PRSI), as employers are not obligated to pay the maternity period.
Eligibility for payment from the PRSI consists of one of the following options:
- At least 39 weeks of PRSI paid in the 12 months before the first day of the maternity leave
- At least 39 weeks of PRSI paid since first starting work and at least 39 weeks of PRSI paid or credited in the relevant tax year or the tax year immediately following the relevant tax year
- At least 26 weeks of PRSI paid in the relevant tax year and at least 26 weeks PRSI paid in the tax year immediately before the relevant tax year
The weekly standard rate of maternity benefit is is 289.00 EUR.
Paternity Leave
Fathers or the partner of the mother are entitled to 2 weeks of paid paternity leave (paid by the Social Protection department if the employee has paid enough PRSI contributions to qualify). Leave can start any time within the first six months after birth, or placement in the case of an adoption.
Relevant parents are the following:
- The father of the child
- The partner (spouse, civil partner, or cohabitant) of the mother of the child
- The parent of a donor-conceived child
The employer is not required to pay the employee during paternity leave, but the employee may qualify for paternity benefit during this time if they have contributed sufficient PRSI contributions. The weekly standard rate of Paternity benefit is is 289.00 EUR.
Parent’s Leave
Each parent is entitled to 9 weeks of Parent’s Leave during the first 2 years of a child’s life, including adoption.
This leave is paid by the authorities, providing the employee has sufficiently contributed to the PRSI. The benefit amounts to up to €289 per week.
Parental Leave
Parents are entitled to up to 26 weeks of unpaid parental leave for each eligible child before 12 years old. To qualify for the leave, the employee must have been employed for at least one year and provided the employer with a written parental leave request at least six weeks before the required start date.
Adoptive leave entitles one adoptive parent to up to 24 weeks’ unpaid leave from the date the child is placed in the employee’s care.
Medical Care Leave
Parents who need time off work to deal with serious medical care for their child can take 5 days of unpaid leave in any 12 consecutive month period.
Other Leave
Depending on the collective agreement/employment contract terms, an employee may be allowed additional leave types once approved between the employer and employee for the following:
- Bereavement Leave: It is not required but is common practice for an employee to be given 3 days of paid leave in the event of the death of an immediate member of the family.
- Jury Service Leave: Employers must provide their full-time, regularly employed employees with job-protected and unpaid leave for their duty as jurors or as a witness in a case or acting as a plaintiff or defendant in the courts. Employees must provide a copy of the jury summons to the employer as evidence of requirement. The court will provide a specific amount of payment, and the employer can choose to provide any additional payment.
PAID MATERNITY LEAVE (DAYS)
Termination
Termination Process
During the probation period, both the employer and the employee can terminate the employment relationship without giving a specific reason. However, the provisions regulating special termination protection as well as the applicable notice period in the contract of employment and other general requirements must be considered.
Employers needs to have substantial grounds for dismissal of an employee after 52 weeks of continuous employment. To avoid an “unfair dismissal claim”, the Irish Unfair Dismissal Act 1977 states the following scenarios are considered to be fair grounds for dismissal:
- Personal situation, e.g. lateness, absenteeism, short-term sick leave, long-term sick leave
- Competence or qualifications
- Conduct
- Redundancy
- Other ‘substantial grounds’
Certain reasons for dismissal are considered to be automatically unfair. These include, but are not limited to:
- Membership or proposed membership of a trade union or engaging in trade union activities, whether within permitted times during work or outside of working hours
- Religious or political opinions
- Legal proceedings against an employer where an employee is a party or a witness
- Race, colour, sexual orientation, age or membership of the Traveller community
- Pregnancy, giving birth or breastfeeding or any matters connected with pregnancy or birth
- Availing of rights under legislation such as maternity leave, adoptive leave, paternity leave, carer’s leave, parental or force majeure leave
- Unfair selection for redundancy
It is important to note that according to the employment equality legislation, dismissal based on any of the following grounds for discrimination is prohibited: gender, civil status, family status, age, disability, religious belief, race, sexual orientation or membership of the Traveller community. If an employee feels they have been discriminated against on any of the aforementioned grounds but have not completed the required years’ service to be able to bring a claim under the unfair dismissals legislation, it could be possible to submit an unfair dismissals claim under employment equality legislation.
General Requirements In Ireland, the dismissed employee has the option to challenge the dismissal with the Workplace Relations Commission and, if necessary, with the Labour Court and claim continued employment, if they believe the dismissal to be unfair.
In any termination, the following general requirements are to be followed (additional specific actions could be required based on a case by case assessment):
- The employer must give written notice of termination to the employee.
- The written notice of termination must be signed by the employer. This can be digitally signed by the employer and can be sent to the employee per email.
- If the employer and the employee have mutually agreed upon a longer contractual notice period, the longer contractual notice period will prevail.
Termination based upon the above listed reasons will require adherence to set process and procedures, along with strong evidence to ensure the termination will hold up to scrutiny in the event the termination in challenged. In some cases it is advisable to consider an mutual separation agreement; the current benchmark for payout is up to 6 months salary, but this will vary depending on the individual circumstances.
| Salary payment interval / date | Final payment on termination | Bank account payment requirement |
|---|---|---|
| Wages must be paid at “regular intervals” and not less often than once a month unless otherwise agreed. | When employment ends, all wages and “monetary sums which by virtue of this Law are due to the employee” must be paid on or before the next scheduled pay-day following termination. | The law does not require payment only via bank account in all cases. Wages must be paid “to the worker for whom they are payable” and payment method may include bank transfer, cheque or other means agreed by the parties. |
Notice Period
In accordance with the contract terms, the notice period is dependent on the length of employment according to the below minimums:
- During Probation = no notice required
- 13 weeks – 2 years service = 1 week notice
- 2-5 years service = 2 weeks notice
- 5-10 years service = 4 weeks notice
- 10-15 years service = 6 weeks notice
- 15+ years service = 8 weeks notice
There is no statutory entitlement to pay in lieu of notice (PILON), however, it can be included within the employment contract.
There is also no statutory entitlement to garden leave. However, it can be included in the employment contract.
Severance Pay
Severance is payable only to redundant employees with 2 years’ service at the rate of 2 weeks’ pay per year of service plus an additional week’s pay. Pay is capped at EUR 600 per week. More generous terms are possible and quite common.
Probation Period
The common probationary period to use is 3 months. Generally probation periods should not exceed 6 months except in exceptional cases.
Common Benefits
- Wellness allowance ranging from 40 to 80 EUR per month
- Health allowance approximately 200 EUR monthly
- Life insurance allowance monthly 50 to 100 EUR
- Private pension employer contribution of 5% to 10% of salary
- Additional Paid Annual Leave between 25 to 30 days per year.
- For Parakar -As of 1 January 2026, Ireland launched the Auto-Enrolment Retirement Savings Scheme, also known as MyFutureFund. This new initiative aims to help nearly 750,000 workers begin saving for their retirement.Under the scheme, contributions will be automatically collected through payroll from employees, employers, and the State:
- Employee contribution: 1.5% of gross salary
- Employer contribution: 1.5% of gross salary
- State contribution: 0.5% top-up
In 2026 alone, the Irish State will contribute approximately €154 million to support the rollout of this programme.
Immigration
Non-residents of Ireland are classified into two primary groups, European nationals (EEA) and non-European nationals (Non- EEA). EEA nationals can seek work without requiring a work permit, and non-EEA nationals must apply and pay for a work permit or green card. The permit is initially granted for two years.
Foreign workers in Ireland must have a valid work permit if their salaries exceed a certain threshold and are subject to Irish taxation on incomes earned in Ireland and abroad.
Further changes may come into force in 2021 following Brexit implementation.
Short Stay Visas
All applicants for a short stay ‘C’ visa (whether for a single entry or multiple entries) must show that they have a sufficiently strong family, social or economic ties to a place of residence in a country other than Ireland to assure the visa officer assessing the application that the projected stay in Ireland will be temporary and in accordance with the duration and conditions of the permission granted by the immigration authorities on arrival in Ireland.
Types of stay include Business, Conference or event, Tourist, and Internship.
The maximum stay allowed under a short stay ‘C’ visa is 90 days.
Long Stay Visas
Individuals wishing to travel to Ireland for more than three months, for example, to pursue a course of study, for work, or to settle permanently in Ireland with family members who are already residents in Ireland, can apply for a long stay ‘D’ visa for a single entry.
If they are granted a long stay ‘D’ visa and wish to remain in the country for longer than three months or beyond the period of leave given to them by an immigration officer at an Irish port of entry, they will be required to register and obtain a residence permit.
VAT
General
Standard VAT Rate: 23.00% standard rate on most goods and services.
Reduced VAT Rate: 13.5% on items such as coal, heating oil, veterinary fees, building services and certain food products.
Second Reduced VAT Rate: 9% on specific items e.g. on heat pumps installed since January 2025.
Livestock VAT Rate: 4.8%
Flat-Rate VAT Compensation for Farmers: 5.1%
Stay up to date on payroll & employment law changes
Version History
Sick Leave – Employees with at least 13 weeks’ continuous service are entitled to 3 days of sick pay per year.
Payroll contributions and personal income tax rates have been updated.
Paternity leave increased to 5 weeks. Will increase to 7 weeks in July.
New payroll contributions come into effect.
New personal income tax rates come into effect.
Questions & Answers
See how Papaya can help you automate your global payroll or EoR whilst staying 100% compliant with local labor laws
Payroll and Benefits Guide
in Ireland
What’s covered in this guide:
- Employer/employee contributions
- Minimum wage
- Working hours
- Visa requirements
And more...
Public Holidays Calendar
| Date | Day | Holiday | Notes |
|---|---|---|---|
| 1 January 2026 | Thursday | New Year’s Day | Standard holiday |
| 2 February 2026 | Monday | St. Brigid’s Day | Standard holiday |
| 17 March 2026 | Tuesday | St. Patrick’s Day | Standard holiday |
| 6 April 2026 | Monday | Easter Monday | Standard holiday |
| 4 May 2026 | Monday | May Day | Standard holiday |
| 1 June 2026 | Monday | June Bank Holiday | Standard holiday |
| 3 August 2026 | Monday | August Bank Holiday | Standard holiday |
| 26 October 2026 | Monday | October Bank Holiday | Standard holiday |
| 25 December 2026 | Friday | Christmas Day | Standard holiday |
| 26 December 2026 | Saturday | St. Stephen’s Day | Standard holiday |
Are there any legal alternatives I can offer my employees if a public holiday comes at a time of intense work?
Employees are entitled to 9 public holidays. Those days can be taken on the day of the holiday, as a paid day off in the month of the holiday, as an extra day of annual leave, or as an addition day’s pay.
What’s the usual on call rate if it is on bank holiday?
It can be agreed that work is done on a bank holiday if a different day off is given in lieu, or additional (double) pay can be given if no additional day is agreed.