The Cabinet has approved a €180m final settlement on pension arrangements for Waterford Crystal employees, who lost their pensions when both the company and their pension scheme became insolvent in 2009.
The workers' union, Unite, won its case in Europe when it argued that Government had failed to make adequate provision for the pension entitlements of workers who found themselves in such a "double insolvency".
Since then negotiations chaired by Labour Relations Commission Chief Executive Kieran Mulvey have been taking place to establish the appropriate level of compensation for the workers.
The settlement will apply to all 1,774 deferred members of the Waterford Crystal Staff and Factory Pension Schemes.
This will include the families of some who have already died since the company went into receivership.
Under the settlement terms, the former workers of Waterford Crystal will receive significant pensions and a tax free lump sum by way of compensation for the delay and stress involved in bringing Irish and European court cases to resolve the matter.
Under the additional provisions approved, lump sums are to be based on years and months of permanent company service, rather than on service within the pension scheme.
The cash compensation will be calculated at €1,200 per member per year of pensionable company service, not exceeding 40 years.
This change will increase the cost of the collective lump sums from €41m to €45m.
The remaining €135m will be spent on ongoing pension payments.
The settlement will be funded from the levy on private sector pension funds introduced some years ago.
Under the settlement, workers who were due pensions of less than €12,000 before the closure will get 90% of their expected entitlement.
They will get 67% of their pension expectations between €12,001 and €24,000.
They will receive 50% of any expected entitlements above €24,000.