The Dáil has passed legislation to cut the National Minimum Wage by €1 to €7.65.
The Government won the final vote by 79 votes to 74 and Fianna Fáil's Mattie McGrath voted with Opposition against the legislation.
During the debate the Finance Minister Brian Lenihan denied that the cut was being made at the behest of the EU or the IMF.
He said a high minimum wage "presented a barrier to job creation particularly in the hospitality and retail sectors".
Labour's Roisin Shorthall has accused Government of allowing the poor to become "fair game".