Childcare workers are to be paid in full and parents won't have to pay crèche fees for three months under new emergency measures announced by the Minister for Children.
The aim of the measures is to ensure creches' can reopen once the crisis has passed and to provide assurance to parents and workers in the sector.
But many créches say they will still struggle to survive.
Childcare employees are paid privately so many creche's rely on fees from parents and state subsidies.
The Government has now stepped in to help which means that workers will be paid in full.
Revenue will pay 70% of the salary while the Department of Children and Youth Affairs will pay the remainder.
There will also be a contribution of around 15% of staff wages to go towards running costs.
Childcare providers will be required to sign a new Covid-19 Emergency Agreement.
This will ensure that childcare providers will not charge parents and they will have to open their books to Revenue.
Crèches will also be expected to hold the places of children, providing that the crèche is still trading after the crisis.
Where childcare workers have lost their jobs, crèches will be expected to make efforts to hire back the workers who were made unemployed.
The emergency measures will be in place for 12 weeks.
In a statement, the Minister for Children Katherine Zappone said staff should use the time for Continuous Professional Development and other professional activities.
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She said employers should use this time to catch up on administrative tasks and familiarise themselves further with the National Childcare Scheme and any other resources, including new resources which will be developed in the coming weeks.
The Director of Policy and Advocacy with Early Childhood Ireland has described the decision by the Department of Children and Youth Affairs to pay the fees of crèche workers as a win for parents.
However, speaking on RTÉ's Today with Sean O'Rourke, Frances Byrne warned that a "funding cliff" will emerge in 12 weeks' time if the crisis continues.
The Federation of Early Childhood Providers has written to the Minister this evening asking her to reinstate all existing schemes.
In the letter the Federation said the new measures "will result in services not being able to meet their overheads or fund the payment of staff as we will have considerable cash flow issues. Your proposal will immediately result in the termination of employment for a significant number of staff, running into the tens of thousands, and the closure of a vast number of services nationwide."
The Federation "demanded" that the situation by rectified within the next 24 hours saying some creches as already closing down.