Measures could be introduced so that train passengers who are delayed by more than an hour receive a full refund.
The Improved Rail Passenger Bill would also see delays of between 20 and 39 minutes resulting in a 25 per cent refund and 40 to 59 minutes leading to a 50 per cent refund.
It is hoped the scheme will incentivise Irish Rail to operate their services as promised.
Fine Gael Senator John McGahon has proposed the Bill, which he said would improve public trust in public transport.
Mr McGahon said: "I hear regularly from commuters that it is not unusual for several trains to be delayed on any given week. Quite frankly, that is not good enough. Frequent delays and cancellations of rail transport services are unacceptable."
He added: “The way that the current public transport operates needs to be improved. To ensure trains run on time, according to their stated schedule, passengers need to have confidence that the rail operators adhere to that schedule, or else be faced with having to financially compensate passengers for their late trains. This tiered scheme of compensation will financially incentivise Irish Rail to operate their services as they promise."
