Firstly, roles are made redundant, not indivuduals, therefore it would normally be illegal to make someone compulsary redundant and then replace them immediately with someone on cheaper wages performing the same task. The challenge however comes in prooving that the new staff are performing the same roles as the previous staff.
However, given that employing agency workers is not VAT exempt and allowing for agency markups to include employers PRSI etc, agency staff can actually be very expensive, so I would wonder why they are doing it, unless you are currently on high salaries