Despite signing the likes of James Chambers, Craig Walsh and Billy Dennehy in the off-season, Hoops boss felt that Bayly was good enough to add something different to their roster.
The former Cherry Orchard schoolboy originally made a big impression as a trainee with Leeds United, but returned to Ireland in 2008 to join Sporting Fingal.
He played a key role in helping The Ravens seal promotion to the top flight and lift the FAI Ford Cup last season, although he opted to move on this year and spent time on trial with various clubs before signing for Rovers.
"Robert’s a talented player who had a very good season last year with Sporting Fingal," said O’Neill.
"He’ll make a welcome addition to our squad."
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