Large hospitals that fail to comply with an EU directive on working hours for junior doctors are to face financial penalties of up to €650,000 under a new deal.

The deal was brokered between the Health Service Executive and the Irish Medical Organisation.

The IMO has said it is recommending acceptance of the Labour Relations Commission deal to its Non-Consultant Hospital Doctor members because for the first time there are real sanctions for non-compliant hospitals.

HSE National Director of Human Resources Barry O'Brien said that hospitals would be sanctioned on a pro rata basis if they made junior doctors work more than 24 hours after the EU directive comes in in January.

Medium-sized hospitals could be penalised by up to €350,000 and the smallest hospitals by €225,000.

Speaking on RTÉ's Morning Ireland, Mr O'Brien said the HSE and the IMO had agreed to work collectively to ensure compliance by hospitals with the working hours directive.

He also said that the "ultimate sanction" of re-assignment could apply to managers who fail to give effect to the directive.