Employer of Record (EOR) Ireland

Streamline your global expansion with our Global PEO services, a hassle-free solution without the need for entity setup. Our Employer of Record (EOR) in Ireland ensures a legal presence, compliance, and intellectual property (IP) protection, allowing your business to focus on its core operations. Facilitate seamless global mobility and work visas while building a diverse and efficient global workforce. Partner with Mercans, your Employer of Record in Ireland, for a compliant and efficient employment experience for your global workforce.

Things you need to know before hiring in Ireland

Employment Contracts in Ireland

Employment Contracts

As an employer, when you hire an individual for a regular wage or salary, you establish a ‘contract of employment’ with them. This contract delineates both your rights and responsibilities as an employer and those of your employees.

Legally, you are not required to provide the entire contract in writing; however, you must issue a ‘written statement of terms of employment’ to your employees, outlining the key terms of their employment.

Employment contracts can be categorized into open-ended or fixed-term types. Most employment contracts are open-ended, meaning they continue until either you or the employee decides to terminate the contract, typically by providing notice. Alternatively, you may offer fixed-term or specified-purpose contracts that end on a particular date or upon the completion of a specific task.

Your employment contract with employees may include:

• ‘Express’ Terms: These are clearly communicated to the employee either verbally or in writing.
• ‘Implied’ Terms: These are not explicitly stated but are understood as part of the employment relationship (e.g., the expectation for employees to perform their job to the best of their ability).

Employer Responsibilities for Providing Terms of Employment

As an employer in Ireland, you are required to provide a written statement of the core terms of employment within the first five days of an employee starting their job. This written statement should outline both the employer’s and employee’s rights and responsibilities, establishing a clear ‘contract of employment.’ While the entire contract does not need to be in writing, this written statement is essential.

Core Terms of Employment

You must provide the following core terms in writing within five days of the employee’s start date:

• Full names of both the employer and the employee.
• Employer’s address
• Place of work
• Start date of employment.
• Job title or a description of the nature of the work.
• Duration of the contract, if it is temporary or fixed-term.
• Pay rate or method of calculation, and the pay reference period.
• Expected working hours and days.
• Probation period duration and conditions, if applicable.
• Terms related to working hours, including overtime

Remaining Terms of Employment

You must provide a written statement of the remaining terms of employment within two months of the employee’s start date. This should include:

• Pay intervals
• Paid leave entitlements, including annual leave and public holidays.
• Sick pay provisions.
• Pension schemes
• Notice periods for termination.
• Details of any collective agreements
• Training provided by the employer.
• For temporary agency contracts, the identity of the hiring person or firm
• Social security contributions and protections.

If an employee is required to work outside Ireland for at least one month, you must also provide a written statement of the terms and conditions of their employment before they leave.

Working Hours

In Ireland, the standard maximum average working time is 48 hours per week. This average is normally calculated over a 4-month reference period, although in some sectors or under certain collective agreements it may be calculated over 6 or 12 months. This excludes time spent on annual leave, sick leave, maternity leave, adoptive leave, paternity leave, parental leave, and force majeure leave. Certain categories of workers are exempt or subject to specific rules. Young workers have separate protections and limits. For guidance on managing working hours and compliance, Mercans is here to assist.

Probation Period

In Ireland, a probationary period is commonly included in employment contracts to evaluate a new employee’s performance. Under the European Union (Transparent and Predictable Working Conditions) Regulations 2022, probation periods generally cannot exceed 6 months. In limited circumstances, probation may be extended where this is in the employee’s interest or where the employee has been absent, and public service probation may extend to 12 months. During probation, the Unfair Dismissals Acts generally do not apply where the dismissal occurs within the first 12 months of employment, but dismissals connected to discriminatory grounds, trade union activity, pregnancy, or statutory leave can still give rise to claims. Fair procedures should still be followed, particularly in cases involving alleged misconduct or capability concerns.

13th Month Salary

There is no legal requirement to provide a 13th or 14th month’s salary.

Termination, Severance Pay and Notice Period

Employees vs Independent Contractors

In the modern workforce, it’s crucial to correctly classify workers as either independent contractors or employees. Misclassification can lead to legal issues and unintended liabilities. The distinction between these two types of work arrangements primarily hinges on the nature of the contract and the relationship between the individual and the organization.

Independent Contractors operate under a contract for services and are generally considered self-employed. They have control over their work, bear financial risks, and are responsible for their own business operations. Employees, on the other hand, work under a contract of service and are entitled to employment protections, benefits, and rights.

Here’s a comparative look at the key differences between an Independent Contractor and an Employee:

Key Points for Employers

• Contractual Clarity: Ensure clear contractual terms defining the nature of the relationship. Independent contractors should have detailed contracts specifying their commercial role.
• Legal Compliance: Misclassification can lead to legal issues and financial consequences. Adhering to the correct classification helps avoid breaches of employment legislation.
• Financial and Legal Responsibilities: Understand the financial and legal responsibilities associated with each type of worker to ensure compliance and proper management.

Social Security in Ireland

Pay-Related Social Insurance (PRSI) is a mandatory contribution on employment income, including certain taxable benefits. For employees in Class A, employee PRSI is generally nil up to weekly earnings of EUR 352 and 4.2% above that level until 30 September 2026, rising to 4.35% from 1 October 2026. Employer PRSI under Class A is generally 9.0% on weekly earnings up to EUR 552 and 11.25% above EUR 552 until 30 September 2026, rising to 9.15% and 11.40% respectively from 1 October 2026.

PRSI also applies to self-employed income. Self-employed individuals generally become liable to Class S PRSI once annual income reaches EUR 5,000. The Class S rate is 4.2% until 30 September 2026 and 4.35% from 1 October 2026, subject to a minimum annual contribution of EUR 650.

Upcoming Changes: Effective 1 October 2026, PRSI rates will increase again for both employers and employees, with the updated rates reflected in the applicable PRSI class tables.

Additional Information

• Self-Employed PRSI: Individuals with annual income below EUR 5,000 are generally not subject to Class S PRSI.
• Employee PRSI: PRSI may apply to share-based remuneration depending on the type of award and the facts of the arrangement. Employers should review the relevant Revenue guidance for equity compensation.

Payroll in Ireland

Payroll Essentials for Ireland

Understanding payroll regulations in Ireland is vital for businesses operating locally. These rules cover everything from company registration, tax obligations, and social insurance contributions to employee benefits. Mercans ensures seamless compliance with Irish payroll laws, expertly handling all required processes. This guide outlines the key payroll obligations in Ireland, including legal requirements, pension responsibilities, employment standards, and essential payroll procedures.

Government Requirements

Registration Requirements

• Employer Registration: Employers who hire staff in Ireland must register as an employer with Revenue before paying employees. Registration is generally completed online through Revenue’s eRegistration service or ROS.
• Director Registration: Companies must also operate PAYE for directors where required. Directors must pay Irish tax on income that is taxable in Ireland.
• Exemptions: Registration is not generally required for a domestic employer with only one domestic employee who is employed solely in the home and paid less than EUR 40 per week.
• Forms for Registration: Registration is now primarily completed online. In certain cases, paper forms such as Form TR1, TR1 (FT), TR2, TR2 (FT), or PREM Reg may still be used where applicable.
• You pay them less than EUR 40 per week
• You employ only one such individual

To register for PAYE or Pay Related Social Insurance (PRSI), the following paper-based forms may still be used in limited cases:

• Form TR1 for individuals, sole traders, or partnerships
• Form TR1 (FT) for non-resident individuals, sole traders, or partnerships
• Form TR2 for companies
• Form TR2 (FT) for non-resident traders
• Form PREM Reg for employers already registered for income tax or corporation tax

Payroll registration must be completed before the first employee starts working.

Hiring an Employee

• New Employees/Someone Who Has Never Worked in the State Before : New employees should create a “myAccount” and register their job under “Add Job or Pension Details” in PAYE Services. A Revenue Payroll Notification (RPN) is then made available to the employer for payroll deductions.
• Returning EmployeesSomeone Who Has Worked in the State Before: If the employee has worked in the State before, the employer should register the employment and obtain the employee’s current RPN through payroll software or ROS before the first payday.

Ongoing Compliance Requirements

Employees are taxed via PAYE (Pay As You Earn), which is deducted directly from their pay by the employer. The amounts deducted are determined by Revenue based on Revenue Payroll Notifications (RPNs) issued to employers, ensuring accurate tax collection.

• Income Tax and PAYE: Employers must consistently deduct PAYE from employee pay, ensuring compliance with tax regulations and reporting requirements.
• PAYE Rates: Income tax is deducted at 20% and 40%, depending on the employee’s tax rate band and personal circumstances.
• PRSI Contributions: Employees in Class A generally pay nil PRSI up to EUR 352 per week and 4.2% above that until 30 September 2026, with higher rates applying from 1 October 2026. Employer PRSI in Class A is generally 9.0% up to EUR 552 per week and 11.25% above that until 30 September 2026.
• USC Deductions: For 2026, the Universal Social Charge is generally charged at 0.5%, 2%, 3%, and 8% depending on income thresholds, with an exemption where total income does not exceed the annual USC exemption limit.
• Revenue Payroll Notification (RPN): This document provides essential information for accurate tax deductions and must be updated regularly. Employers can retrieve RPNs through payroll software or directly via ROS.
• Payroll Submissions: Employers must report payroll details to the Revenue Commissioners on or before the date employees are paid. Each submission includes gross pay, payment dates, and deductions. Monthly statements from Revenue summarize liabilities and must be reviewed, accepted, or amended by the employer by the relevant deadline.

Pension Requirements

Registration and Types of Pension Schemes

• Types of Schemes: Common options include occupational pension schemes, personal retirement savings accounts (PRSAs), and personal pension plans. Tax treatment depends on compliance with the relevant Revenue rules.
• Employer Obligations: Employers that do not offer an occupational pension scheme must generally provide access to at least one standard PRSA for eligible excluded employees. Where an employer operates a pension scheme, payroll deductions and employer contributions must be remitted in line with scheme and provider requirements.
• Additional Contributions: Employees can make extra voluntary contributions (AVCs), but any excess over age-related limits will not receive immediate tax relief.

Employment Obligations

Contracts and Employment Terms

• Contract Requirements: Employees must receive a written statement detailing core terms within five days of starting, including names, addresses, expected duration, pay rates, and working hours.
• Further Terms: A complete statement of terms must be provided within two months, covering job title, place of work, pay intervals, leave entitlements, and notice periods.

Rates of Pay

As of 1 January 2026, the national minimum wage is EUR 14.15 per hour, with reduced age-based rates applying to workers under 20.

Working Hours and Leave

Employers must ensure compliance with working time regulations, providing adequate rest breaks and leave, including annual, maternity, paternity, adoptive, parental, parent’s, carer’s, and sick leave where applicable. Minimum annual leave entitlement is four weeks, and Ireland has 10 public holidays each year.

Payroll Requirements

• Pay Slips: All employees are entitled to a pay slip detailing gross wages and deductions, provided in either electronic or hard copy.

Banking Requirements Related to Payroll

Payroll payments can be made through various methods, including checks, credit transfers, or cash, providing flexibility for employers.

Minimum Wages

The National Minimum Wage Act 2000 establishes the minimum amount employees must be paid. As of 1 January 2026, the national minimum wage is €14.15 per hour. While employers can offer more, they cannot legally pay less than this rate, except in specific circumstances.

Payroll Cycle

In Ireland, there is no statutory requirement to run payroll on a specific cycle such as weekly or monthly. Employees must be paid in accordance with the contract of employment, and employers must report pay and deductions to Revenue on or before the pay date. There are no regulations governing the payment of a 13th-month salary.

Overtime Pay

Overtime refers to work performed beyond your regular working hours. In general, there is no statutory entitlement to a higher overtime rate unless it is provided for in the employment contract, a collective agreement, or a sector-specific employment order. Nevertheless, many employers offer higher pay rates for overtime hours. To understand your entitlements, review your employment contract to confirm if overtime is required and, if so, the applicable pay rates. Additionally, certain industries may offer increased overtime pay compared to regular hours.

Mercans’ payroll capabilities

Personal Income Tax in Ireland

In Ireland, personal income tax is applicable based on residency and domicile status. Individuals who are both resident and domiciled in Ireland are generally taxed on their worldwide income. Individuals who are resident but not domiciled are generally taxed on Irish-source income, foreign employment income attributable to duties performed in Ireland, and other foreign income to the extent remitted to Ireland. Non-residents are generally taxed on Irish-source income and employment income relating to Irish work duties, subject to treaty relief where relevant.

Personal Income Tax Rates (2026)

Single and Widowed Persons (no dependent children):

• 20% tax rate on income up to €44,000
• 40% tax rate on income exceeding €44,000

Married Couple (one income):

• 20% tax rate on income up to €53,000
• 40% tax rate on income exceeding €53,000

Married Couple (two incomes):

• 20% tax rate on income up to €88,000 maximum, depending on the lower earner’s income
• 40% tax rate on income exceeding the applicable standard rate band

Ireland Employee Hiring Cost

Employing Individuals in Ireland: Employer Costs Breakdown

Employing individuals in Ireland involves several employer costs, including social insurance contributions and other mandatory benefits. Let’s break down the employer costs for an employee with a Gross Annual Salary of €240,000:

• Social Insurance Contributions: Employers in Ireland are generally required to contribute to the Pay-Related Social Insurance (PRSI) scheme. For a high-earning employee in Class A, employer PRSI is generally charged at 11.25% until 30 September 2026 and 11.40% from 1 October 2026, subject to the applicable class rules and thresholds.
• Total Annual Cost: When factoring in additional expenses such as pension contributions, private health insurance, and other benefits, the total annual cost of employing an individual will usually exceed the gross salary plus employer PRSI. Actual total cost will depend on the employee’s package and the timing of payments during the year.

For more detailed calculations and information about employer costs, you can refer to the latest guidelines on employment regulations and benefits in Ireland.

Employee Benefits in Ireland

Work Permit in Ireland

Overview of Employment Permits

Ireland operates a range of employment permits for non-EEA nationals. The Department of Enterprise, Trade and Employment (DETE) administers the main employment permit system, while certain short-term permissions and immigration permissions are handled by the Irish immigration authorities. The principal permit types include the Critical Skills Employment Permit, Intra-Company Transfer Employment Permit, General Employment Permit, Contract for Services Employment Permit, Dependant/Partner/Spouse Employment Permit, Internship Employment Permit, Sports and Cultural Employment Permit, Exchange Agreement Employment Permit, and Reactivation Employment Permit.

Critical Skills Employment Permit

The Critical Skills Employment Permit is aimed at attracting highly skilled professionals to Ireland. To qualify, an individual must have an eligible job offer and meet the applicable remuneration threshold. As of 2026, eligible roles generally require annual remuneration of at least EUR 68,911, or EUR 40,904 for occupations on the Critical Skills Occupations List. A reduced threshold of EUR 36,848 may apply in certain recent graduate cases. The permit is typically issued for up to 2 years, and the application fee is generally EUR 1,000. Eligible family members may seek permission to reside and work in Ireland under the relevant immigration rules.

General Employment Permit

The General Employment Permit is intended for non-EEA nationals seeking employment in roles that are not on the Ineligible List of Occupations for Employment Permits. As of 2026, the main minimum annual remuneration threshold is EUR 36,605, with certain lower thresholds applying in specific cases such as recent graduate roles or designated occupations. The role must satisfy the permit criteria, and labour market testing may apply unless an exemption is available. The permit is generally available for an initial period of up to 2 years, with standard fees of EUR 500 for permits of 6 months or less and EUR 1,000 for permits of more than 6 months up to 24 months.

Intra-Company Transfer (ICT) Permit

The Intra-Company Transfer Employment Permit allows for the transfer of senior management, key personnel, or trainees from an overseas company to an Irish branch or subsidiary. The transferee remains employed by the foreign employer. As of 2026, the minimum annual remuneration threshold is EUR 49,523 for senior management and key personnel, and EUR 36,605 for trainees. The permit can be granted for periods ranging from 6 months up to 2 years initially, with extensions possible within the maximum limits set by the scheme. Standard fees are EUR 500 for permits of 6 months or less, EUR 1,000 for permits of more than 6 months up to 24 months, and EUR 1,500 for an extension application.

Permit Exemptions

Certain individuals are exempt from needing employment permits in Ireland. These include EEA and Swiss nationals, as well as non-EEA nationals who hold an immigration permission that already grants a right to work, such as certain Stamp 4 permissions and other exempt categories under Irish law. Eligibility should always be checked against the current DETE and immigration rules.

Atypical Working Scheme

The Atypical Working Scheme caters to short-term employment scenarios where a standard employment permit is not appropriate. It is commonly used for certain assignments of 15 to 90 days. Applications must generally be approved before travel to Ireland. If the person is visa-required, a visa must also be obtained after the permission is granted. The applicable fee should be checked at the time of application, as immigration fees and operational rules may change.

EOR Solutions in Ireland

Best Employer of Record Ireland

Mercans is the best employer of record in Ireland for several compelling reasons:

• Compliant with Office of Revenue Commissioners and Workplace Relations Commission (WRC): Mercans ensures adherence to all local regulatory requirements, maintaining compliance with the Office of Revenue Commissioners and the Workplace Relations Commission to provide a reliable and legally sound service.
• Own Entity: Operating as an independent entity, Mercans offers a high level of operational integrity and flexibility, distinguishing itself with a dedicated focus on employment solutions.
• Supports All Employment Types – Employees, Freelancers, Contractors, Expats: Whether managing traditional employees, freelancers, contractors, or expatriates, Mercans efficiently handles a diverse range of employment types, catering to various workforce needs.
• Suitable for Enterprise Businesses: Designed to meet the complex needs of large-scale enterprises, Mercans provides robust solutions that align with the operational demands of sizable organizations.
• Supports Multiple Currencies: Mercans’ ability to manage multiple currencies facilitates seamless international transactions and payroll processing, essential for global business operations.
• Global Presence and Multi-Country Payroll Capabilities: With a broad international reach, Mercans offers multi-country payroll services, simplifying global workforce management for businesses operating across borders.
• GDPR Certified, SOC 1 & SOC 2 Compliant: Mercans adheres to stringent data protection and security standards, being GDPR certified and SOC 1 & SOC 2 compliant to ensure the highest level of data integrity and privacy.
• ISO 20000 & ISO 27001 Certified: Mercans holds ISO 20000 and ISO 27001 certifications, underscoring its commitment to IT service management and information security, further validating its reliability as an employer of record.
• OWASP ASVS 3.0 Compliant: By aligning with the OWASP Application Security Verification Standard (ASVS) 3.0, Mercans demonstrates its dedication to advanced security practices and safeguarding applications.
• HRBlizz: Mercans HR Blizz is a proprietary global payroll and talent management SaaS suite that streamlines payroll processes while ensuring compliance with local regulations. With over 1,000 in-country specialists, it provides expert knowledge of labor laws and business protocols.
• G2N Nova: G2N Nova provides global gross-to-net payroll processing in over 100 countries, making it the world’s most advanced native payroll engine. Available as a SaaS or service delivery platform, it can function as a stand-alone solution or integrate seamlessly with major HCM and Workforce Management systems.