It was originally agreed in 2008 and has been renewed on a two-year basis since then.
On Monday, it was renewed for a further three years.
The bilateral agreement signed between the Irish and US governments relates only to the 12-month J1 visa.
It does not apply to the four-month programme, which many Irish students use to spend a summer working in the US.
There have been concerns about the future of the J1 programme given previous remarks from US President-elect Donald Trump that he plans to end the scheme.
In August 2015, in a position paper posted on his website, Mr Trump said: "The J1 visa jobs programme for foreign youth will be terminated and replaced with a résumé bank for inner city youth provided to all corporate subscribers to the J1 visa programme."
However that paper is no longer available on his website and the same pledge is not contained in his latest policy paper on immigration.
Despite the signing of Monday's agreement, uncertainty still hangs over the programme as Mr Trump could shut it down by executive order once he takes office on 20 January.
In 2015, 1,319 Irish people availed of the 12-month J1 visa, and around 7,000 took part in the four-month J1 Summer Work Travel Programme.
About 300 Americans availed of the reciprocal arrangement and travelled to Ireland for a 12-month period of travel and work.
The Republic of Ireland and the United States have signed an agreement extending the 12-month J1 visa for another three years.