Employee benefits in Ireland: Everything you need to know

Benefits are key to attracting top talent, with data showing that in larger companies, access rates can be as high as 91% to sick leave and 83% for vacations. Many professionals think strong benefits are an indicator of a healthy, supportive workplace, and there's some truth to that belief: Providing better benefits to your employees is an easy way to show you care about the people who work with you. Irish companies have an especially strong reputation for delivering on benefits.

So, whether Ireland is your home turf or a far-away dream, you'll have to offer attractive packages to compete if you plan to hire there.

In this guide, you'll learn about the legally mandated employee benefits in Ireland and the perks Irish companies often offer on top of them.

Looking to reward your global team? Offer salary, equity, and benefits confidently with Oyster.

Who is entitled to employee benefits in Ireland?

In Ireland, employees are entitled to comprehensive benefits packages, while independent contractors typically receive limited coverage. Here's the key difference: employees get both government social insurance benefits (funded through PRSI contributions) and employer-provided benefits, while contractors only access basic social insurance.

So, how do you tell the difference? It comes down to control and working arrangements:

• Employees: Work under company-set terms, hours, and methods
• Contractors: Set their own schedules and work on a project basis

Getting this classification wrong can lead to legal and tax consequences of misclassification.

Mandatory employee benefits in Ireland

To operate legally in Ireland, employers must offer their employees certain benefits that protect their well-being. The following six benefits are the country's baseline entitlements.

Paid annual leave

Employees who work at least 1,365 hours at a single company in a year are entitled to 20 days (four workweeks) of paid leave annually. Those who work part-time may also be eligible for paid annual leave of up to 8% of their total hours, up to the full-time maximum of 20 days.

People who switch jobs receive a similar benefit, just calculated a bit differently: They earn one-third of a business week of leave for each month they've worked a minimum of 117 hours.

Statutory sick pay

Both full-time and part-time employees receive five days of sick pay per year—an increase from three days as of January 2024. This benefit kicks in after 13 weeks of work with an employer.

To use sick leave, an employee must provide certification from their general practitioner proving they're unable to work due to illness.

Personal Retirement Savings Account (PRSA)

A Personal Retirement Savings Account (PRSA) is a pension in Ireland that helps employees save for retirement through investments. There are two types of PRSAs: standard and non-standard. Most workers will have their needs met with a standard PRSA—which caps how much providers can charge per year—but some find a non-standard PRSA—which offers wider investment options but more risk—would be a better fit. Employees set the parameters of their investments with the PRSA provider. These accounts have low minimums, so workers don't have to invest much if they don't want to.

With retirement benefits were available to a high percentage of workers across company sizes, it's a key part of compensation, and any employer in Ireland that doesn't have another retirement plan in place for their employees must offer access to a PRSA.

Maternity, paternity, and parental leave

While there's no mandatory employer-paid maternity pay in Ireland, Irish employees are entitled to 26 weeks of maternity leave with state Maternity Benefit (if eligible), plus an optional 16 weeks of unpaid leave. Employers aren't obliged to supplement this, but offering paid top-ups can be a valuable perk.

For paternity leave, employees can take two weeks off at any point of the child's first six months. As with maternity leave, employers aren't required to pay employees for this type of leave, so you'll stand out if you do offer it.

Finally, the Irish government provides nine weeks of paid parent's leave. Parents can use this time off at any point in the child's first two years of life on top of maternity or paternity leave. Parent's leave is distinct from parental leave, though they sound similar. Parental leave is an unpaid option for employees who have worked with your company for at least one full year, allowing for 26 weeks to care for their child before age 12 (or 16 if the child has a disability). Pitching in for parental leave is another great opportunity to support your team's lives, though it's not as common to see in benefits packages.

Public holidays

Ireland has 10 public holidays (also known as bank holidays) when public institutions and companies generally close. These holidays mark religious celebrations like Christmas, as well as some Mondays in summer and early fall.

Full-time employees receive pay during public holidays, and part-time employees who have worked at least 40 hours over five consecutive weeks are also entitled to pay.

Workers' compensation insurance

Ireland's Occupational Injuries Scheme provides benefits to anyone injured or disabled due to a workplace accident. These employees receive pay and may have their medical care covered cost-free.

Irish employers generally offer workers' compensation insurance. If you want to make a competitive offer to Irish talent, consider working with an employer of record (EOR) in Ireland, which can help you get this type of insurance for your organization.

Social Security And PRSI Contributions

In Ireland, the social insurance system is funded through Pay Related Social Insurance (PRSI) contributions. It's not optional—both employers and employees are required to contribute a percentage of the employee's earnings. These contributions fund key social welfare benefits, including state pensions, illness benefits, and maternity/paternity benefits.

Here's what you need to handle as an employer:

• Deduct PRSI: Take the correct percentage from employee paychecks
• Pay your share: Add your employer contribution on top
• Submit to Revenue: Send both portions to the tax authority

Contribution rates change based on earnings and employment class, so accurate payroll is essential.

Non-mandatory benefits in Ireland

Demonstrating your dedication to a happy, healthy workforce makes it easier for your employees—and your organization—to thrive. The following are a few perks you can offer to go above and beyond:

• Private health insurance: In Ireland, health insurance is state-funded, meaning there's universal healthcare for all citizens. But this doesn't stop many from wanting a private plan as well, and your company can surpass expectations by offering it.
• Life assurance: Irish companies generally have Group Life Assurance, a type of life insurance that pays a sum to the families or other designated beneficiaries of employees who die while in service to the organization. By extending Group Life Assurance coverage, your organization can show it cares about its employees' families as well.
• Additional paid leave: More time off than the bare minimum is always appreciated by prospective talent. You can offer employees more time off with an additional paid leave package allowing them to take off 30 or more days a year.
• Cycle to Work: Ireland has a Cycle to Work Scheme that's optional for employers, but an attractive perk for employees. In this scheme, a company buys bicycles for participating employees, who pay back directly out of their paychecks (before taxes) over time. This benefit can be re-gifted every four years as the bike wears out, which is another way to show appreciation for committed employees.
• Gym memberships and wellness programs: Paying for access to gyms or other wellness centers, like yoga studios, promotes physical health and team satisfaction.
• Employee assistance programs: Employee assistance programs (EAPs) help people care for their mental health. By offering an EAP, your organization connects workers with therapy services and other types of confidential mental wellness care.
• Professional development: Professional development opportunities empower employees by giving them tools to improve their work (among other things). Extending free access to relevant conferences or an educational subsidy for those who want to pursue further degrees can also help your organization stay on top of the latest breakthroughs in your field.
• Flexible working arrangements: Consider allowing employees to work remotely or set their own hours, with a certain amount of scheduling overlap with the rest of the team. Your company will establish a better work-life balance as a result.

Healthcare And Insurance Benefits

Ireland's public healthcare system works well, but wait times can be lengthy. That's why private health insurance has become a cornerstone of competitive benefits packages, reflecting a broader trend where a significant portion of the workforce participates in employer-provided medical plans.

Beyond health coverage, smart employers often include:

• Life assurance: Death-in-service benefits for families
• Income protection: Disability insurance for financial security
• Private health insurance: Faster access to specialists and treatments

Tax Considerations For Employee Benefits

Here's the thing about taxes on benefits: not all perks are treated equally. You'll need to understand Benefit-in-Kind (BIK) tax, which applies to benefits with monetary value.

As the employer, you're responsible for reporting BIK benefits correctly on payroll.

Managing benefits for international employees: 3 steps

Sound familiar? You're not a lawyer, but suddenly you need to understand Irish labor law. Here are three steps to get compliant benefits right without the legal headaches.

1. Understand local regulations

Before extending the statutory benefits required by law, you'll need to register with the Irish tax authority (the Office of Revenue Services, also known as Revenue) as a legal employer.

Once your organization is registered, create a payroll process that calculates the right withholding percentages for these benefit contributions. All Irish citizens and employers must contribute to PRSI, and it's imperative you make these deductions correctly and keep a record of all contributions for Revenue.

2. Partner with local brokers

If you plan to offer additional perks, work with reputable Irish benefits providers and insurance brokers to cover your workforce's needs. These providers should offer group plans that fit your company's size and budget.

Alternatively, you can team up with an EOR service, like Oyster, to simplify the process. They can help you hire and manage benefits, payroll, and time off for team members in Ireland—or just about anywhere else in the world.

3. Handle enrollment and administration

Once you've hired an Irish employee, guide them through the benefits enrollment process. They'll have to enter information on government websites to set up certain benefits, like their pensions, correctly. And you'll need to collect paperwork from employees for any private benefits providers.

Support your team in Ireland with the right benefits

Step confidently into international hiring by partnering with Oyster. Start by figuring out the cost of hiring in Ireland with Oyster's employment cost calculator. Then, check out Oyster's Total Rewards program and discover how, by partnering with Oyster, you can offer employees around the world the best benefits packages possible.

Book a demo today to learn more about how Oyster can facilitate global hiring and employment.

About Oyster

Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.

Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.