More than 100 jobs are to be axed at Crumlin Children's Hospital in a bid to cut costs, trade union Impact claimed tonight.
The hospital said the redundancies were part of a €7m cost savings scheme and would affect temporary and agency workers.
A spokeswoman said the Health Service Executive (HSE) had provided additional funding to the hospital this year but only on the condition that it reduce spending.
Impact hit out at the HSE claiming it was penalising the hospital for providing services and said the cuts would hit most of the hospital's departments.
"As pay costs represent over 70% of the hospital's expenditure, it is in this area that the most significant savings can be achieved," a spokeswoman for Our Lady's Hospital Crumlin said.
"This will involve reductions in agency and temporary staff numbers and not filling some vacant posts.
"Permanent employees' contracts will in no way be affected by this measure.
"There is ongoing discussion and consultation in-house in relation to identifying posts which will not be replaced."
The spokeswoman said the hospital's demands had increased over the last number of years and it had taken on new staff.
It spent €10m more in 2007 than what it received in funding from the HSE and its spending projection for this year is also €14m over budget.
The HSE cleared the debts for last year and gave an additional €7m this year on the condition the hospital reduces costs by €7m.
"The reduction in staff numbers will nevertheless reduce overall activity within the hospital but Our Lady's wishes to reassure children and families that it will do everything it can to protect the most vulnerable," the spokeswoman said.
The hospital would not confirm how many staff are to be affected.
Impact's Eamonn Donnelly said the hospital was being penalised for providing services.
"In 2007, the hospital received €10m less in funding from the HSE than it actually spent - money spent as a direct result of trying to meet the needs of children referred to the hospital.
"This year, the hospital has had to agree in advance that €7m of savings will be achieved, despite their projected expenditure."
Last week almost 30,000 health workers began a work-to-rule over claims of a recruitment freeze by the HSE.
Impact said workers were refusing to cover vital posts left vacant by a HSE embargo on hiring staff.
Members voted overwhelmingly for action late last month claiming the ban was having a devastating effect on services, but the HSE denied a staffing freeze was in place.
In a statement the HSE said it was aware of the financial challenges faced by Crumlin hospital and that it had been working to help them manage their budget.
"Our Lady's Children's Hospital, Crumlin, is a voluntary hospital funded by the HSE," a spokesman said.
"The Hospital's budget has increased from €98.3m in 2004 to €128.3m in 2007 and again to €136.6m for 2008. In percentage terms the budget increased by 38.9% since 2004."
The body one again denied a recruitment freeze was in place and urged Impact to end its industrial action.
"There is no current recruitment freeze in place despite the union's claims," the spokesman said.
"The HSE has put in place strict controls to ensure that all future recruitment in the health services is geared towards patient services.
"A total of 2,416 staff have been appointed since the beginning of this year."