Graduate nurses can start applying for 1,000 graduate nurses positions with the Health Service Executive from today.
The nurses will be hired on two-year contracts, but will have starting salaries 20% lower than those of existing nurses.
Irish Nurses and Midwives Organisation General Secretary Liam Doran said the move is attempt by the HSE to introduce what he described as "cheap labour".
Mr Doran said that some new graduates who were already in employment were having those contracts cancelled by the HSE, which would make them re-apply for the new graduate programme for which they will be paid a lower salary.
Director of Human Resources at the HSE Barry O'Brien said the jobs were additional posts to the 35,000 nurses already employed by the HSE and were being funded by replacing overtime, and agency staff.
"[The INMO claim] is absolutely incorrect and I think it's hugely misleading to graduates and their parents, who are currently considering making an application.”
In response to Mr O’Brien’s comments, the INMO reiterated that it had been clearly stated in a 14 December 2012 circular from Mr O’Brien that: "Please be advised that should any hospital have provided contracted employment to 2012 graduates following on from their final clinical placement these should be discontinued immediately".
According to the INMO, this is “explicitly designed to advise hospitals to terminate the employment of new graduates, currently being paid the correct rate, so that they are forced to apply for these new jobs at the 80% rate”.
“In addition the INMO reaffirms the reality that, in order to fund these graduate places, 1,000 existing nurses, currently employed through agencies and on short-term contracts will have to be sacked to allow for these new graduates to take up their posts.”
Meanwhile, Tánaiste Eamon Gilmore said that graduate nurse plan is an opportunity for graduates who would not otherwise have a job.
Speaking on the same programme, Mr Gilmore said it was opportunity for graduates to get valuable experience.
He said: "What this is about is giving job opportunities to graduates who wouldn't otherwise have them.
"What do we want here? Do we want nursing graduates to emigrate or do we want to find job opportunities for them in our health service where they can get valuable work experience, where they can get an income and where they can contribute to our health service?"
He said the Government's aim was to get people into employment and he said the Coalition had to think "outside the box" to provide job opportunities.
Mr Gilmore said he hoped that levels of pay could be looked at again in 2015 when the state of the health service was in a better position.