Payroll & Employment Guide Ireland

In Ireland, employers are legally required to provide employees with a written statement outlining the terms and conditions of employment within two months of starting. This document must include key details such as job title, pay, working hours, and other essential terms.

Employers can choose from various types of contracts depending on the nature of the role, including permanent, fixed-term, temporary, and casual contracts.

Notice periods: One week for employees; one to eight weeks for employers, depending on the employees’ length of service

Termination of employment: Grounds for termination of employment include redundancy, misconduct, or capability issues.

Employers in Ireland must provide statutory employment benefits under national labour laws. Many also offer additional perks to remain competitive and attract talent.

Social security (PRSI): Both employers and employees contribute to Pay Related Social Insurance (PRSI), which funds pensions, unemployment benefits, and family-related supports. PRSI contributions are reported and paid through the PAYE system.

From 1 October 2025, Class A PRSI rates are:

• Employees: 4.2%
• Employers: 11.25%

Planned PRSI increases:

• +0.15% in 2026 and 2027
• +0.2% in 2028

Healthcare: Ireland operates a public and private healthcare system. All residents can access public healthcare, while many employers offer private health insurance to provide faster access and broader treatment options.

Pension – MyFutureFund (from 1 January 2026): Ireland will introduce mandatory pension auto-enrolment under MyFutureFund for eligible employees not already in a workplace pension.

Key features:

• Contributions from employee, employer, and government
• Employees can opt out after 6 months and receive a refund of their own contributions
• Employers must manage enrolment via the MyFutureFund employer portal

Auto-enrolment applies if the employee:

• Is aged 23–60
• Is not already in a workplace pension
• Earns €20,000+ per year (across all jobs) or €5,000+ in any 13-week period

Statutory leave and benefits

• Annual leave: Minimum of 4 weeks (20 days) per year. Part-time entitlement is 8% of hours worked, capped at 4 weeks.
• Sick leave: 7 days per year (from 1 January 2025), paid at 70% of earnings, capped at €110/day. Medical certificate required by day 4.
• Maternity leave: 26 weeks paid (subject to PRSI) plus 16 weeks unpaid. At least 2 weeks must be taken before birth and 4 weeks after.
• Parent’s leave: 9 weeks per parent (for children born or adopted on or after 1 August 2024), payable by the state up to €274/week, subject to PRSI.
• Bereavement leave: Commonly 3 paid days for immediate family, usually contractual rather than statutory.
• Jury service: Job-protected unpaid leave. Court provides payment; employers may top up voluntarily.

Unemployment and disability benefits

• Jobseeker’s benefit (JB): Available to those with sufficient PRSI contributions; payment is earnings-related.
• Jobseeker’s allowance (JA): Means-tested support for those without sufficient PRSI.
• Disability allowance (DA): Weekly payment for individuals with a disability, available from age 16.

In Ireland, employers are responsible for withholding income tax (PAYE), social insurance (PRSI), and the Universal Social Charge (USC) from employees’ wages.

Personal income tax rate: Income up to €44,000 — 20%; Income above €44,000 is taxed at the higher rate of 40%.

VAT: 23%

Tax allowances: Personal tax credits and reliefs such as the Single Person Credit and Married Couple Credit

Additional tax reliefs: Medical expenses and pension contributions.

In Ireland, employers are required to pay salaries according to the terms outlined in individual employment contracts or collective agreements. These salaries must not be less than the national minimum wage of €14.15 per hour, effective from 1 January 2026.

The monetary unit in Ireland is the Euro, often represented by the € symbol or abbreviated as EUR.

Ceiling fee for contributions:

Social security (PRSI) contributions – Class A:

• Employee rate: 4.2%
• Employer rate: 8.80% – 11.25%, depending on employee earnings

Universal Social Charge (USC):

• €0 – €12,012: 0.5%
• €12,013 – €28,700: 2%
• €28,701 – €70,044: 3%
• Over €70,045: 8%

From 1 January 2026, the 2% USC threshold increases to €28,700, ensuring that minimum-wage earners do not move into the 3% USC band.

In Ireland, the typical working week runs from Monday to Friday, with a maximum average of 48 hours allowed over a four-month period. Employees are entitled to 24 consecutive hours of rest within any seven-day period.

The 13th-month pay is not compulsory in Ireland, meaning employers are not required to provide this additional salary.

Salaries are typically paid during the last week of each month, aligning with standard payroll practices. This structure helps maintain clarity and consistency in compensation for employees throughout their employment.

Salary payment deadline: No single statutory deadline

Taxes and contributions payments deadline: By the 23rd day of the following month if submitted online, or by the 14th if filed on paper.

Payroll declarations deadline: Same as taxes and contributions

Payroll currency: EUR

Employment law in Ireland is shaped by common law, statutes, and the Irish Constitution. The Constitution guarantees key rights, such as equality, freedom of association, and the right to earn a living. The Employment Equality Acts 1998–2015 further prohibit discrimination in areas such as hiring, promotion, and training based on factors like gender, age, race, and disability.

Total employment cost:

• Pay Related Social Insurance (PRSI): 8.8% to 11.25%, depending on employee earnings

Minimum wage: €14.15 per hour (from 1 January 2026)

Probation period: Up to six months

Using EOR services in Ireland lets you employ individuals legally without setting up a local entity. The EOR becomes the legal employer and takes care of:

• Legal employment and contracts
• Payroll processing
• Tax withholding
• Benefits administration
• Onboarding/offboarding employees

Using PEO services in Ireland offers HR and administrative support while you remain the legal employer. It’s ideal for businesses with a local entity that need help managing day-to-day workforce operations, including:

• HR support and workforce administration
• Payroll and benefits management
• Compliance and local labour law guidance
• Employment contracts assistance

Native Teams offers a payroll calculator tailored to Ireland’s labour laws. It helps you quickly estimate net and gross salaries, mandatory deductions, and both employer and employee contributions.