Employee Benefits Ireland: What Employers Should Offer in 2025

Navigating employee benefits in Ireland can feel like a balancing act. 

From mandatory entitlements like annual leave and sick pay to supplementary benefits like health insurance, there’s a lot to consider. 

In this guide, we’ll break it all down. You’ll discover what’s required, what’s optional, and how to make it all work for your team.  

What Are the Employee Benefits in Ireland? 

Employee benefits in Ireland include:  

• Mandatory benefits, like pension access and paid annual leave.

• Supplementary benefits, such as private health insurance.

• State-sponsored benefits, like the State Pension and maternity benefits.

Let’s discuss these in detail:

A. Mandatory Benefits in Ireland

In Ireland, certain employee benefits are mandated by law. As of 2025, these include:

• Access to a Pension Scheme

• Pay Related Social Insurance (PRSI)

• Paid Annual Leave

Let’s go over each one quickly:

1. Access to a Pension Scheme

As an employer, you are not legally required to provide an occupational pension scheme at the moment. 

However, you must ensure your employees have access to a Personal Retirement Savings Account (PRSA) in the following cases:

• They are not already part of your company pension plan.

• They are included in a plan that offers death-in-service benefits only.

• They are not eligible to join your occupational pension scheme within six months of starting work.

• They are part of an occupational pension scheme that does not allow for Additional Voluntary Contributions (AVCs).

What to know about PRSAs:

• A PRSA is a personal pension plan. Your employees can make regular or lump-sum contributions to the PRSA and they may be eligible for tax relief. 

• As an employer, you can facilitate access to a PRSA by entering a contract with a PRSA provider. Here’s a list of authorised PRSA providers. 

• You are not required to contribute to employees’ PRSAs, but you can choose to do so as a benefit-in-kind. In this case, your business may receive a certain amount of tax relief on employer contributions against corporate tax.

We recommend you go through The Pensions Authority’s PRSA guide to understand employer obligations in more detail. 

Upcoming Changes with Auto Enrolment (September 2025)

Ireland’s Auto Enrolment Retirement Savings Scheme, My Future Fund, will start from 30 September 2025. 

Employers will be legally required to contribute to this scheme on behalf of their employees. Employees will also be required to contribute for a specific period before they can opt out.

However, if you already have an occupational pension scheme that covers all employees from their day of hire, your business would be exempt from the Auto Enrolment scheme.  

If you only have PRSAs, you must either prepare for Auto Enrolment or offer an occupational pension scheme like mentioned above. 

Check out our detailed Irish Auto Enrolment guide to learn how you can prepare for this new pension scheme. 

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2. Pay Related Social Insurance (PRSI)

Pay Related Social Insurance (PRSI) is a government-mandated insurance contribution that funds social welfare benefits and pensions in Ireland. 

It’s considered an employee benefit because it gives your team access to crucial state benefits like the Maternity Benefit, State Pension, etc., providing financial security and protection.

How PRSI Works 

As an employer, you’re legally required to deduct the correct amount of PRSI from your employees’ earnings and to submit it, along with your own PRSI contribution, to the Revenue as part of the PAYE (Pay As You Earn) system.

The amount is decided based on your employee’s pay and type of work (social insurance class) — but it’s usually 4.1% of income for anyone earning over €352 a week. 

You deduct your employee’s amount from their salary and add your portion of 11.15% before making the total contribution. 

The amount deducted from your employee’s salary is always displayed on their payslip. 

PRSI Compliance

Ireland’s Department of Social Protection (DSP) strictly monitors PRSI payments. 

Every year, DSP inspectors may arrive at your workplace to check whether you:

• Are making PRSI contributions.

• Have proper PRSI records. 

• Understate employee wages, etc. 

Failure to comply with PRSI regulations can result in hefty penalties and reputational damage. 

Check out the government’s PRSI guide for employers for more information. 

3. Annual Leave

Annual leave is paid time off from work. All Irish employees, including full-time, part-time, temporary, and casual staff, are entitled to it.

Typically, it’s at least four weeks, or 20 days, of paid leave each year. 

However, it depends on how much time your employee has worked in a leave year — which runs from 1 April to 31 March. 

Your employees can calculate their annual leave entitlement in three ways and use the method that gives them the highest entitlement. The three methods are:

• Method 1: Hours Worked in a Full Leave Year

  • If they have worked at least 1,365 hours in the leave year with the same employer, they are entitled to a maximum of 4 working weeks of paid annual leave.

  • This method isn’t applicable if the employee changed jobs during the leave year. 

• Method 2: Calendar Months Worked

  • They are entitled to 1/3 of a working week for each calendar month in which they worked at least 117 hours.

• Method 3: Total Hours Worked

  • They can calculate their entitlement as 8% of the total hours worked during the leave year, up to a maximum of 4 working weeks.

  • Usually, annual leave for part-timers is calculated using this method. 

As an employer, you can offer additional paid leave days (beyond the legal requirement) as an incentive.  

4. Protective Leave

In Ireland, employees are entitled to various statutory leaves for family and caregiving purposes. 

You aren’t legally required to pay for these. Most of them are covered by social insurance (PRSI). With that said, you can compensate your employees for taking them.

Time spent on statutory leave is treated as if the employee was working, so it doesn’t reduce their annual leave entitlement.

Protective leave in Ireland includes the following:

• Maternity leave: 

  • Pregnant employees can take 26 weeks of maternity leave. 

  • During these 26 weeks, the government pays a Maternity Benefit if pregnant employees have enough PRSI contributions. 

  • They can also take 16 weeks of unpaid additional maternity leave.

  • They should take at least 2 weeks of leave before delivery and at least 4 weeks after the birth. 

• Paternity leave: 

  • This amounts to 2 weeks during the first 6 months after the child is born or adopted. 

  • Paternity applies to the child’s father, the mother’s partner, or the parent of a donor-conceived child. 

  • Anyone with enough PRSI contributions can get a Paternity Benefit from the Department of Social Protection.

• Parent’s leave: 

  • This gives each parent access to 9 weeks of leave during the first two years of the child’s life.

  • Parents can get a weekly Parent’s Benefit of €289 if they have enough PRSI contributions.

• Parental leave: 

  • Parents of older children can take up to 26 weeks of parental leave per eligible child before their 12th birthday. 

  • No government benefits are paid for parental leave. However, your employees can be credited with PRSI contributions to protect their social insurance records and entitlement to future benefits.

• Adoptive leave: 

  • Provides one parent of an adopting couple or a parent who is adopting alone access to 24 weeks of leave. 

  • The 24 weeks begins on the day the child is placed in the parent's care.

  • Your employees can receive an Adoptive Benefit if they have enough PRSI contributions.

• Carer’s Leave:

  • 13 to 104 weeks of unpaid leave to provide full-time care for someone in need.

  • If the employee has enough PRSI credits, they may qualify for Carer’s Benefit. 

  • If they don’t qualify for Carer’s Benefit, they can apply for a means-tested Carer’s Allowance. 

5. Sick Leave & Sick Pay

Under the Sick Leave Act 2022, your employees are entitled to seven paid sick days in 2025 (this will increase to 10 paid sick days from 2026 onwards). 

You should pay your employees 70% of their daily wage up to a maximum of €110 per day.  

To be eligible, an employee must have at least 13 weeks of continuous service. A doctor must also certify that they are unfit to work. 

As an employer, you can offer your own sick pay arrangement, provided it is more favourable than the statutory sick pay (SSP) scheme. Your employees can’t receive statutory sick pay in addition to the benefits from your scheme. 

B. Supplementary Benefits In Ireland

Besides the legally mandated benefits, offering supplementary perks can set your business apart. These benefits are optional but highly valued by employees and can help with retention and morale.

Some examples of supplementary benefits include:

1. Private Health Insurance

2. Income Protection Insurance

3. Life Assurance

4. Dental and Vision Plan

5. Stock Options

6. Fitness Benefits

7. Work Flexibility

8. The Cycle-To-Work Scheme

9. Employee Assistance Programme (EAP)

10. Tax-Saver Commuter Benefits

11. Subsidised Food / Social Committees and Events

12. Training and Development Courses

1. Private Health Insurance

Private health insurance is one of the most valuable perks you can offer your team. 

According to the 2024 SHRM Employee Benefits Survey, 88% of employees consider healthcare an extremely important benefit. 

It’s a win-win: faster access to specialists, shorter waiting times, and better care for your employees, while also making your company a more attractive place to work.

These health insurance plans usually include inpatient and outpatient services, maternity care, and mental health support — basically everything your team needs to stay on top of their health. 

Some companies even extend coverage to employees’ families, making this benefit even more impactful.

Since private medical insurance is considered a benefit-in-kind in Ireland, your employees are taxed on the value of their premiums. 

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• Provide employees with a user-friendly portal to track their coverage and benefits.

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2. Income Protection Insurance

Income protection insurance plans (permanent health insurance) provide replacement income for your employees who cannot work due to illness or injury. 

How can you provide income protection?

• Short-term protection plans: You could provide short-term protection plans (monthly payments for fewer than two years) for your employees who may fall ill or become injured during employment. 

• Long-term protection plans: You could offer long-term income protection plans that pay 50-70% of your employee’s salary for a minimum term of five years.  

3. Life Assurance (Death-in-Service Schemes)

Some employees receive life assurance plans as part of their benefits package. 

Why provide life assurance schemes?

Life assurance provides financial support to your employee's dependents in the event of their unexpected passing.

Generally, the sum assured is around four times the employee’s base salary. Your employees are usually covered under the plan for the duration of their employment with you.

Since life assurance (or even life insurance) schemes are established under trust, the dependents can quickly receive the benefits.

4. Dental and Vision Plan

You can offer separate optical and dental insurance plans to your employees in addition to private health insurance plans.

• Optical benefits cover the costs of eye check-ups and emergency appointments. 

• Dental benefits usually cover dental appointments, cleaning, extractions, fillings, and some dental surgeries. 

Aren't dental and vision already part of your employees’ health insurance package? 

Most health insurance plans don’t cover optical and oral health. You may need to pay extra to obtain dental and vision plans for your employees.

5. Stock Options

In Ireland, you can offer company stock as compensation for your employees or workers.

The most common stock option programs are:

• Restricted Stock Scheme: These plans allow your employees to purchase stock easily, but there are restrictions on disposing of those shares.

• Approved Profit Sharing Scheme (APPS): This allows your employees to convert profit-sharing bonuses into the business’ shares.

6. Fitness Benefits

Want to encourage a workplace fitness culture?

Offer fitness benefits! 

Maybe you could offer a free onsite gym for your employees. 

Or perhaps, partner with local gyms for free or discounted employee memberships. 

You could offer additional benefits like:

• Weekly yoga or pilates classes.

• Mental health support.

• Cycling, running and walking events and challenges.

• Onsite health screenings. 

Some fitness benefits, like gym memberships, are considered benefit-in-kind, and your employees can be taxed on their value. 

You generally don’t pay tax on benefits provided to your employees — the tax amounts are reduced from your employees’ gross pay. 

7. Work Flexibility

You can offer flexible work benefits to your workforce, such as compressed work weeks during the summer, flexible working hours, and work-from-home days. 

Some employers even offer their employees a home-office stipend! 

These stipends help your employees meet work-related expenses like the cost of internet and telephone bills. 

Your employees don’t have to pay tax on home-office stipends for up to €3.20 per day.

8. The Cycle-To-Work Scheme

This government initiative allows you to purchase bicycles and safety equipment worth up to €1,250 (€1,500 for an e-bike and €3000 for cargo/ecargo bikes) for your employees. 

Your employees can then repay the cost from their salary before taxes, helping them save on the purchasing cost. 

9. Employee Assistance Programme (EAP)

An Employee Assistance Programme (EAP) is a confidential support service to help employees address personal or work-related challenges that may impact their well-being or job performance.

What does it cover?

EAPs generally focus on helping your employees resolve personal problems that may affect their work performance. These include substance abuse, child and elder care, financial and legal trouble, and relationship issues. 

Some EAPs also provide adoption assistance, nurse advice lines, and even support staff who have faced accidents and other traumatic incidents at the workplace. 

10. Tax-Saver Commuter Benefits

Under this benefit scheme, you can pre-purchase public transit tickets and allow your employees to pay them from their pre-tax wages. 

You can manage these programs in-house or through third-party vendors.

11. Subsidised Food / Social Committees and Events

Some ways you can offer these benefits are:

• Free vending machines

• Juice bars

• Onsite restaurants

• Social events like sponsored night-outs 

12. Training and Development Courses

Want to upskill your team?

Offer them training and development courses (through in-house or external providers). 

Your employees can sign up for professional memberships, mentor programs, and online courses. 

Your employees don’t have to pay tax on these benefits when the training:

• Directly relates to their job.

• Relates to what the business does.

• Helps facilitate work required in the company.

C. State-Sponsored Benefits

The Irish state also provides your employees with certain benefits. 

Let’s take a look at some of them:

• The State Pension

• Invalidity Pension

• Contributory Death Benefits

• Public Health Services

• Illness Benefit

• Maternity Benefit

1. The State Pension

A person above 65 years is eligible for the State Pension (Contributory) if they:

• Started making PRSI contributions before 56 years of age.

• Meet the required number of PRSI contributions.

• Meet other specified criteria.

For more information, check out our in-depth guides on the two pension schemes:

• State Pension (Contributory)  

• State Pension (Non-Contributory) 

2. Invalidity Pension

The state issues an Invalidity Pension for those who couldn’t work for at least 12 months — typically someone who received illness benefits for a minimum of 12 months. 

The receiver must make enough social insurance (PRSI) contributions and satisfy other conditions, such as being ineligible for work. 

3. Contributory Death Benefits

A widow/widower can receive a pension if all contribution conditions have been met on either spouse’s PRSI records as of the date of death.

The catch?

The two PRSI records can’t be amalgamated to qualify for the pension. 

4. Public Health Services

Any ordinarily resident person in Ireland and some visitors can access public health services for free or at a subsidised cost. 

Who’s an ordinarily resident person?

Ordinarily resident people are those who have lived in Ireland for at least one year or who intend to live there for at least one year. 

They have two types of eligibility for public health services:

• Medical card holders receive full eligibility.

• Non-medical card holders receive limited eligibility.

Limited eligibility means your employees don’t get free general practitioner (GP) services and must pay for prescribed medicines. 

However, they get access to public hospital services for free or at a subsidised cost.

5. Illness Benefit

Your employees under 66 years old who suffer from an illness that prevents them from working may be eligible for an Illness Benefit. 

Their illness must be certified by a medical practitioner, and they must have enough PRSI contributions to be eligible for this benefit. 

In 2025, Illness Benefit is €244 for employees with average weekly earnings of €300 or higher.

6. Maternity Benefit

The Maternity Benefit is a social welfare payment made by the government to women who:

• Are employed or self-employed.

• Are on certified maternity leave.

• Have enough PRSI contributions.

• Are in the appropriate PRSI classes.

It’s usually paid for 26 weeks, coinciding with the statutory maternity leave period. In 2025, it’s €289 a week for 26 weeks.

Further Reading

• Discover different Global Employee Benefits you can offer to attract and retain talent in multiple countries.  

• Explore 21+ Employee Benefits you can offer to your teams in the UK and why they’re essential.

How to Manage Employee Benefits in Ireland

As an employer, you must consider several factors when managing an employee benefits scheme:

1. Align with Your Business Goals: Ensure your benefits package supports your organisation’s goals and enhances employee satisfaction.

2. Fulfil Statutory Requirements: Meet all legal obligations, such as annual leave and sick leave entitlements, and consider offering additional benefits to stay competitive.

3. Stay Competitive: Research what benefits your competitors provide and build a package that attracts and retains top talent.

4. Understand Your Employees Needs: Tailor benefits to your team’s preferences to ensure maximum value and appreciation.

5. Keep Employees Involved: Consult employees when introducing new benefits or removing underutilised ones. Transparency fosters trust and engagement.

6. Use Employee Benefits Platforms: Kota streamlines health insurance, life assurance and retirement benefits management. You can even host your existing benefits and perks to keep everything under one roof.  With easy enrolment, automation, and affordable plans, Kota makes employee benefits management simple and stress-free. 

3 FAQs on Employee Benefits Ireland

Let’s answer some common questions on employee benefits:

1. What Are Employee Benefits?

Employee benefits are additional perks or forms of compensation you provide to your employees in addition to their regular wages or salary. 

Some examples include retirement contributions, health insurance, work flexibility, and paid leave.

These benefits can be mandatory (such as statutory leave) or optional (like additional perks offered by employers). 

2. Why Offer Employee Benefits?

In Ireland, you’re legally required to provide certain benefits. These are known as mandatory benefits.

Beyond the legal requirement, offering employee benefits helps:

• Improve productivity: Benefits like annual leave, health insurance, and income protection give your employees the headspace to be their most productive. It means less stress about work fatigue, health care and finances. 

• Provide work-life balance: Flexible working arrangements, remote work opportunities, home office stipends, and fitness benefits show that you care about your employees’ wellness. The resulting work-life balance may reduce stress and prevent burnout — leading to happier, healthier, and more productive employees.
  

• Boost job satisfaction and morale: Your employees are happier and more satisfied when they feel valued. This also leads to better employee retention. 

3. Which Employees Qualify for Statutory Employee Benefits in Ireland?

Full-time employees residing in Ireland are typically entitled to statutory benefits such as annual leave, sick leave, and maternity or paternity leave.

Independent contractors, on the other hand, are not eligible for these benefits, as they are self-employed and not covered under employment laws for employees.

You must classify your employees correctly to avoid misclassification risks. 

What happens if you misclassify employees?

Misclassifying employees as contractors can lead to serious consequences:

• Tax and PRSI Issues: Employees may lose access to social welfare entitlements due to incorrect PRSI contributions.

• Regulatory Penalties: The Workplace Relations Commission (WRC) or Revenue Commissioners may impose fines and penalties for failing to comply with employment laws.

• Reputational Damage: Non-compliance can harm your business reputation and employee trust.

Empower Your Team With Employee Benefits In Ireland

Employee benefits aren’t just a box to tick — they’re a way to invest in your team’s well-being, engagement, and loyalty. 

By blending statutory entitlements with thoughtful supplementary perks, you can create a workplace where employees thrive.

Ready to simplify benefits management? 

Kota helps you streamline pensions, health insurance, and more, all in one place. 

Get started with Kota today!