The national minimum wage came into effect at midnight, with experienced workers over 18 guaranteed a minimum rate of £4.40 an hour by law. The minimum rate for under-18s is £3.08 an hour.
It represented "an assault on exclusion, marginalisation and poverty", according to the Tanaiste and Minister for Enterprise, Trade and Employment, Ms Harney, who said around 160,000 workers would benefit.
The Programme for Prosperity and Fairness recommends the minimum wage should rise to £4.70 from July 2001, and to £5 after October 2002.
Ms Harney said the minimum wage represented a "new era", particularly for women.
"Women have been victim to much of the exploitation there has been over the years when it comes to terms and conditions. In this new era, not only will many women be better paid but thousands will be encouraged to join the workforce."
The Labour Party spokesman on employment, Mr Pat Rabbitte, described the wage as a "modest measure". He said the marketplace had long since overtaken the £4.40 level that was too low genuinely to transform lives.
The Labour Inspectorate with the Department will monitor the implementation of the minimum wage. The Tanaiste said the new legislation would be "readily understood by both employers and employees". The Government thinks workers in the services sector, including hotel and catering staff, hairdressers and home helps, are most likely to benefit .