Ireland is home to a number of major tech companies, including Microsoft, Apple, and Meta. Known as a friendly country with high levels of education, Ireland is a booming talent hotspot for companies looking to recruit top talent. With significant growth in sectors such as IT, energy, environmental engineering, and medical devices, the country is quickly becoming one of the most important economies in the European Union.
A booming market for employees and employers alike, Ireland recently reached an all-time high of 2.5 million people employed. If you’re a global employer seeking to establish a workforce in Ireland, you may think it’ll be easy to get started, especially given the talent pool. However, you must understand how to adequately compensate and provide employee benefits in Ireland before you go on a hiring spree.
Here, we look at the different mandatory and recommended compensation and benefits your company should provide to your Irish workforce.
One of the first things you’ll want to understand when it comes to employee benefits in Ireland is who is and who isn’t entitled to benefits. Under ordinary circumstances, all full-time employees are entitled to statutory benefits, while independent contractors are not.
Employers must ensure that they classify their workers properly and supply them with their statutory benefits to minimize the risk of misclassification. Here are a few key differences between an employee vs. a contractor:
Takes direct orders from an employer
Works at a specific location
Earns a fixed annual salary
More freedom with their working process
Self-controlled workplace and schedule
Can work for numerous clients simultaneously
Can work on a one-off, short-term, or part-time project
Irish employment laws aren’t limited to a singular code. They’re governed by a combination of EU laws, the Irish constitution, and common law. With so many pieces involved in the process, setting up your compensation and benefits can get confusing.
Adult employees aged 20 and over have the right to a €10.50-per-hour national minimum wage, or a monthly income of around $1,650. Minimum wage varies by age.
Employers in Ireland must provide their Irish employees with only one employer-sponsored benefit:
Personal Retirement Savings Account (PRSA). All companies without an occupational pension scheme, or where employees must wait more than six months of employment to join one, are required to offer PRSA access.
There are numerous state-funded benefits, including:
Individuals that can’t work due to a medically certified illness qualify for this. They must have been consistently making social insurance contributions to the Department of Social Security. Employers aren’t required to provide paid sick leave in Ireland, though most do.
Any resident in Ireland has access to the public health system. Depending on their income, employees must pay a certain amount for this benefit or be eligible for fully state-funded care.
Employed and self-employed women who meet specific PRSI (Pay Related Social Insurance) contributions can receive up to 26 weeks of paid leave. Employers aren’t required to provide this, but many do.
There are various leave periods in Ireland in addition to an annual leave of four weeks, including:
Paternal leave: Allows parents 22 weeks’ unpaid leave to support children under 12 years.
New parents/Adoptive leave: Grants new parents (other than the mother of the child) two weeks’ leave within the first six months of birth or adoption.
Parental leave: Lets parents take two weeks’ leave (with two weeks pay) to care for children under one year.
Force majeure leave: Allows employees to quickly take time off due to an injury or illness of a close family member.
Carer’s leave: Lets employees take time off to provide temporary full-time care for someone.
An employment contract can specify any additional benefits for an employee. And a specific industry might even have a collective agreement that takes precedence. Regardless, going above and beyond what is required by the law can help employers attract and retain the best employees.
Statutory employee benefits satisfy regular compliance, but if you’re looking to enhance business, you’ll want to keep your employees motivated with some supplementary benefits.
This is one of the most common benefits paid partially or in whole by employers. Irish employees often expect some form of supplemental health insurance. Inclusions range from dental to optical coverage, outpatient surgery to hospital stays, and more.
This insurance is used as a protective measure in case an employee dies and leaves their dependents in debt or with a significant loss of income. The sum is typically dependent on the sector, but four times the base salary generally is a good amount.
Across all sectors, for employers that contribute to a pension for employees, multiple selections are available, depending on numerous factors of your business. For pension schemes in Ireland, the average employer contribution is 6%, while the average employee contribution is 5%.
Irish employees, along with employees across the globe, are actively seeking work-from-home roles that enable a good work-life balance for the future of work. You can support this by offering improved remote-work conditions such as home-office allowances, including compensation for increased internet and phone costs. Working from home can help boost employee morale.
Along with supplementary benefits, many employers are using additional perks to motivate employees. Here is a short list of some potential perks to consider:
Flexible working hours
Personal learning budget
Therapy or coaching allowances
Meal and travel expenses
Gym or health club memberships
Maintaining compliance with employee benefits can be complex, especially when adding supplemental terms and perks to make the workplace more enjoyable for employees. When planning employee benefits in Ireland, consider outside resources to help lighten your load.
If you plan to establish a subsidiary or entity in Ireland, you have the option of building an in-house HR team or partnering with a third-party provider to manage local HR processes.
Subsidiaries are wholly or partially owned or operated by a parent company, which can control its own business units. Meanwhile, entities are people or organizations with individual legal rights. They can own property, participate in a business, undertake contracts, and pay taxes.
Whether your third-party outsourcing should be a Professional Employer Organization (PEO) or Employer of Record (EOR) mainly depends on if you already have a legal entity in the country you’re hiring in. If you do, you’ll want a PEO, which follows a co-employment model, which can complicate the employer and employee relationship.
If you don’t have an entity, go for an EOR, which can help expand your workforce while maintaining labor laws. An EOR will have its own Irish entity and ensure that your HR processes remain compliant with all local and federal labor laws.
Both large and small companies want to hire employees in Ireland and other countries, but are unsure of how to navigate the country’s benefits processes, payroll, and labor laws. Via’s EOR services makes hiring Irish talent and building your global team seamless. Our easy-to-use platform helps you manage the local HR processes for benefits, payroll, background checks, and more. We have a local team of lawyers and on-the ground experts that understand compliance as you expand abroad.
As your employer-of-record/entity in Ireland, Via assumes responsibility for employment liability, so that you can focus on what matters: recruiting and managing your team.
With Via’s transparent pricing, you can pay full-time employees or contractors in Ireland with no hidden set-up fees, no foreign exchange or transaction fees, and no minimums–start with 1 employee and scale up at your own pace.
Employees must contribute 4% of their income to Pay Related Social Insurance (PRSI) (an income tax) as part of their benefits. If their total annual income is more than €1,905, they must pay tax on their benefits. They can also pay a one-time benefit cost of up to €500 annually, if the employer allows it.
The only mandatory benefit employers must provide in Ireland is a personal retirement savings account (PRSA). Many benefits are state-funded, including health care coverage, pensions and worker’s compensation, and various leave periods.