From 1st of January 2026, the national minimum wage will rise to €14.15 per hour, an increase of 65 cents. This change is part of the Government’s continued effort to align wages with cost-of-living pressures and ensure that lower-paid workers see a meaningful boost in income.
But for employers, especially SMEs, this update brings important considerations around payroll, budget planning, and overall labour costs going into the new year.
What’s Changing?
From 1 January 2026, the new minimum wage rates will apply to eligible employees:
- Standard Rate: €14.15 per hour
- (Sub-minimum rates for younger workers will also increase proportionally)
What Employers Need to Do Now
Here’s how to prepare your business ahead of the January minimum wage change:
- Check Contractual Agreements: If your employment contracts reference specific hourly rates, ensure they are updated to reflect the new minimum wage.
- Update Payroll Systems: Make sure that your payroll software is updated with the new rates and any changes for employees earning below the minimum wage.
Need to Know: Knock-On Effects
The minimum wage increase doesn’t just affect hourly pay — it has additional impacts:
- Higher PRSI contributions
- Potential payroll bracket changes
- Impact on Auto Enrolment pension contributions
- Increased costs of overtime and Sunday premiums
- Possible compression issues (e.g. senior staff now earning closer to junior rates)
Need Help Preparing for 2026 Payroll Changes?
From minimum wage updates to Auto Enrolment contributions and year-end payroll planning — we can help make sure your business stays compliant and cost-efficient.
Book a Free Consultation
Or Contact Us to review your payroll ahead of January.
