About 450 jobs are being axed at the country's three main airports under a multimillion-euro pay cut plan.

The deal involves voluntary redundancies and the non-renewal of a further 150 contracts at Dublin, Cork and Shannon airports, as well as pay cuts and changes to work practices.

The cuts will apply to a range of positions and will help save management 38 million euro.

Dublin Airport Authority (DAA) said it was facing financial difficulties because of the fall-off in passenger numbers, with a 70 million euro shortfall in earnings.

DAA chief executive Declan Collier said: "This is an innovative agreement that has been concluded after many months of intensive negotiations and against the background of a difficult national industrial relations environment. It delivers the payroll savings that are required to address the current financial difficulties facing the DAA in an agreed and equitable manner."

A company spokesman said lay-offs of contracted staff had already begun. DAA said the deal had been agreed at the Labour Relations Commission (LRC) with officials from the trade unions.

Under the graduated pay cuts, staff will face wage reductions of up to 12%, with those earning less than 30,000 euro not affected. There will also be a two-year pay freeze at the company.

DAA said the agreement, which comes after several months of talks between the company and staff representatives, is supported by the LRC.