Working life in Malta

Notes: Values for real GDP per capita are chain-linked volumes (based on 2010 data; €). The unemployment rate for men and women is the annual average as a percentage of the active population aged 15–74 years, and the youth unemployment rate is the annual average as a percentage of people aged 15–24 years. The employment rate for men and women is the annual average as a percentage of the active population aged 15–64 years, and the youth employment rate is the annual average as a percentage of people aged 15–24 years. GDP, gross domestic product.

Sources: Eurostat [sdg_08_10], for real GDP per capita and percentage change 2012–2022; [une_rt_a], for unemployment rate by sex and age; [lfsi_emp_a], for employment rate by sex and age.

Economic and labour market context

Between 2012 and 2022, Malta’s gross domestic product increased considerably, by 43.31%, which is above the EU27 average of 15.29% for the same period. During this time, unemployment fell for all categories and remained well below the EU average, with total unemployment at 2.9% in 2022 (the EU average was 6.2%). The largest decrease was in youth unemployment (-5.5 percentage points). Total employment in 2012–2022 increased by 16.1 percentage points to 80% and is therefore higher than the EU average of 74.5%. The largest increase in this period was in the female employment rate (24 percentage points). Youth employment in 2022 stood at 56.6%, above the EU average of 40.7% for that year. The Maltese economy lost its positive momentum throughout 2020 due to the COVID-19 situation: the gross domestic product for the third quarter of the year was 8.8% lower than the same quarter of the previous year (Eurostat [naidq_10_gdp]).

Legal context

The Employment and Industrial Relations Act 2002 (EIRA), Chapter 452 of the Laws of Malta, is the main labour legislation regulating the minimum conditions of employment, employer associations and trade union representation. The EIRA is complemented by a number of legal notices and 31 wage regulation orders covering different sectors of the economy.

The introduction of new employment-related legal notices are first discussed within the Employment Relations Board, which is a national consultative body set up by the government as provided for in the provisions of the EIRA. The board makes recommendations to the minister responsible for labour, so that issues discussed are eventually included in a national standard order or a sectoral standard order.

The provisions of the EIRA are safeguarded by the Department for Industrial and Employment Relations (DIER), mainly through the Enforcement Section and the Industrial Tribunal.

Industrial relations context

Collective bargaining in Malta is generally conducted at company level between a single trade union representing at least 50% + 1 of the employees as members and a single employer. Collective bargaining usually leads to a collective agreement. In the public sector, where trade unions are traditionally stronger, a collective agreement is signed by seven trade unions. Government corporations/agencies/units are covered by separate collective agreements negotiated individually for each body. In the absence of collective bargaining, remuneration and other conditions of employment are determined by free individual bargaining. However, the Maltese legal framework provides for a national minimum wage, introduced in 1974, and for 31 sectoral wage agreements by means of the wage regulation orders. These orders were composed by tripartite wage councils, which were superseded by the Employment Relations Board in 1992. The establishment of the tripartite Malta Council for Economic Development in 1990 (which later became the Malta Council for Economic and Social Development) facilitated a more cooperative industrial relations approach at national level. For instance, it has led to the National Agreement on Industrial Relations (1990), which established a mechanism based on the inflation rate for the calculation of the yearly cost-of-living adjustment (COLA), which is granted to all employees. The National Agreement on the Minimum Wage signed by the social partners in April 2017 is the most recent example of such a cooperative model.

Adherence to statutory minimum wages and collective agreements is monitored by DIER, and breaches can be investigated by the same department, and tried in front of the Industrial Tribunal, Criminal Court and Civil Court. DIER is also involved in cases requiring conciliation, according to the EIRA.

In February 2016, the Constitutional Court ruled that the EIRA provisions for the appointment of tribunal members offer no guarantee that tribunals will be independent and impartial. Consequently, in June 2016, Act No. XXXIIII of 2016 – the Employment and Industrial Relations (Amendment) Act 2016 – was enacted. Among the most important aspects of these amendments were the increase in the tenure of office of chairpersons and members to five years from the previous three-year period. They may also be reappointed for another period of five years on the approval of the Employment Relations Board. This aims to guarantee security of tenure. In addition, cases requiring a tribunal should now be composed of three members, and the member representing the government must be chosen by the chairperson from a list of members appointed by the minister. Prior to these amendments, the minister had the power to appoint such a member on an ad hoc basis, which could have raised suspicion of bias, for instance in disputes between entities in which the government is the majority shareholder and trade unions.

During the COVID-19 pandemic, social dialogue played an important role. Whereas the first few weeks of the pandemic were characterised by social partners publicly advocating for the introduction of state support to protect enterprises and employment, a package of support measures, including a wage supplement, were introduced following agreement within the tripartite Malta Council for Economic and Social Development. Following this, social dialogue played an important role in the introduction, updating and phasing out of COVID-19-related support measures.

Sectoral agreements are rare in Malta, with most agreements occurring at company level. During the COVID-19 pandemic, trade union interventions were evident in some of the hardest hit and most essential sectors. Industrial relations were vital in agreeing changed working conditions for aviation workers in order to safeguard jobs, reaching agreements on improvements to working conditions for healthcare workers and ensuring that educators were prioritised for COVID-19 vaccination.

Main trade union confederations and federations

Malta has two trade union confederations: the Confederation of Malta Trade Unions (CMTU) and the Forum of Maltese Unions (FORUM). Due to its autonomous sections and affiliate unions, the General Workers’ Union (GWU), which is Malta’s largest union, is also often classed as a confederation; however, the GWU describes itself as a union rather than a confederation.

Main trade union confederations and federations

Notes: * Involvement through its autonomous sections. ** Indirect involvement through member unions.

Source: Registrar of Trade Unions, 2019.

The National Forum of Trade Unions (NFTU) was launched in July 2014. It is composed of a total of 22 unions, the Office of the President and the Centre for Labour Studies at the University of Malta. The tasks of the forum include running information campaigns, holding seminars and carrying out research to gauge public opinion on trade unions. The forum aims to provide an opportunity for trade unions to share experiences and seek collaboration through dialogue. Among the activities carried out to date are seminars on the work of trade unions towards active ageing through collective bargaining, dealing with multiple claims for trade union recognition and analysing the role of unions in closing the gap in workers’ rights to family-friendly measures between the public and private sectors. A national survey on trade unions in Malta was also carried out, and its results discussed among trade unions (NFTU, 2015).

Employer organisations

About employer representation

To formally register a new employer association with the Registrar of Trade Unions, a minimum of seven members is required. Once registered, an organisation enjoys the rights granted by the EIRA, such as the right to ‘perform any act in furtherance of any of the purposes for which it is formed’ (EIRA Section 51(1)). Each year, a registered employer association must supply the Registrar of Trade Unions with the number of paid-up members, details of committee members, a copy of its annual report and an audited copy of its financial accounts (DIER, 2020a). Membership of employer associations is voluntary. According to the annual report of the Registrar of Trade Unions 2019/2020, there were eight employer associations registered with the Registrar of Trade Unions, with a total of 9,108 members (DIER, 2020b). By 2021/2022, this had risen to 12 employer associations, with a total of 9,277 members (DIER, 2022). Another important employer organisation, the Malta Chamber of Commerce, Enterprise and Industry, is not registered with the Registrar of Trade Unions.

Employer organisation membership and density, 2012–2022

Notes: * Such data is not collected in Malta. ** Percentage of employees working in an establishment that is a member of any employer organisation that is involved in collective bargaining. n.a., not available.

Main employer organisations and confederations

The main employer associations in Malta are the Malta Employers’ Association, the Malta Chamber of Commerce, Enterprise and Industry and the Malta Chamber of SMEs.

Main employer organisations and confederations

Note: * Data obtained by the Malta Chamber. n.a., not available.

Source: Report by the Registrar of Trade Unions.

Tripartite and bipartite bodies and concertation

The Malta Council for Economic and Social Development acts as an advisory council that issues opinions and recommendations to the Maltese government on matters of economic and social relevance. During the COVID-19 pandemic, the Malta Council for Economic and Social Development played a key role in fostering social dialogue on national-level and sector-specific support measures to safeguard employment and enterprises.

The Employment Relations Board may make recommendations to the minister responsible for labour on any national minimum standard conditions of employment for eventual inclusion in a national standard order, on any sectoral conditions of employment for eventual inclusion in a sectoral regulation order, on conditions of employment and on any matter referred to the board by the minister.

In April 2017, the National Agreement on the Minimum Wage signed by the social partners signalled the first revision of the minimum wage in 27 years. Minimum wage earners are now entitled to increases in their wages on completion of the first and second year of work with the same employer.

Main tripartite and bipartite bodies

Workplace-level employee representation

Employee representation at workplace level is generally carried out by shop stewards, acting on behalf of the union they represent, who are recognised in their role by their employer.

Trade unions are regulated by the EIRA. The rights and obligations of the trade union and its representatives at shop-floor level are also detailed in collective agreements.

Regulation, composition and competences of the bodies

The central concern of employment relations is the collective governance of work and employment. This section looks at collective bargaining in Malta.

Bargaining system

Collective bargaining in Malta is decentralised and takes place mainly at single-employer bargaining level. Employees voluntarily join a trade union, and the union gains the right to negotiate on behalf of the workers once it reaches membership of 50% + 1 of employees working in a company or in a particular job category within the company. The union informs the management of the company and the director of DIER of its intention to start collective bargaining within that company. Apart from collective negotiation, Legal Notice 2006 – Employee (Information and Consultation) Regulations – which transposes Directive 2002/14/EC, establishes that the union has the legal right to be consulted and informed of all matters relating to employment relations. It should be noted that there have been cases where particular categories of employees claim separate recognition from that of other workers within the same organisation. Collective agreements are legally binding.

Wage bargaining coverage

Official data referring to collective bargaining in Malta are unavailable. The figure derived from the Structure of Earnings Survey reflects the trade union density in Malta, which is normally estimated to be around 50%.

Collective wage bargaining coverage of employees

Sources: Eurofound, European Company Survey 2013/2019 (including private sector companies with establishments with more than 10 employees (Nomenclature of Economic Activities codes B–S), with multiple answers possible); Eurostat [earn_ses10_01], [earn_ses14_01], [earn_ses18_01] (including companies with more than 10 employees (Nomenclature of Economic Activities codes B–S, excluding O), with a single answer for each local unit); OECD and AIAS (2021).

A survey carried out in the last quarter of 2014 by the NFTU indicates that 55.8% of all employees have a collective agreement at their place of work. This survey was based on a sample of 781 employees representing all employees in Malta. The figure excludes employees who are unsure as to whether or not they have a collective agreement at their place of work. The NFTU is composed of 22 trade unions (NFTU, 2015).

Bargaining levels

The collective agreement for public service employees can be regarded as the sole agreement at sectoral level. The Collective Agreement for Public Service Employees (2017–2024) covers around 30,000 employees (Malta Independent, 2017). Collective bargaining in Malta takes place mainly at the company level. Collective bargaining at the company level includes entities in which the state is the majority shareholder, statutory independent bodies, and the private sector. In 2023, 218,000 were employed in the private sector, whereas 51,000 were employed in the public sector (NSO, 2023b). According to a report issued by the Central Bank of Malta (2014), around 23% of workers in the private sector were covered by a collective agreement in 2013.

Levels of collective bargaining, 2022

Articulation

Articulation does not apply to Malta.

Timing of the bargaining rounds

While collective agreements occur throughout the year, one can generally note the conclusion of a number of collective agreements, mostly concerning the public sector, during the weeks immediately prior to political elections.

Coordination

Collective bargaining coordination across sectors is limited to that facilitated by the government, through existing legislation, within tripartite boards. For instance, an Incomes Policy Agreement was reached between the social partners in 1990 within the tripartite Malta Council for Economic and Social Development, in which the mechanism of the annual cost-of-living adjustment based on the Retail Price Index was established. The annual cost-of-living adjustment rate is mandatory. The basic rate of all wages across the economy must be topped up with this increment every year.

The Public Administration Collective Bargaining Unit is explicitly responsible for coordinating wage changes in the public sector.

Extension mechanisms

There are no extension mechanisms relating to collective agreements in the Maltese system.

Derogation mechanisms

Derogation is not possible. Respect for collective agreements is monitored by relevant trade unions and DIER, and derogations can be contested through the Industrial Tribunal and the courts.

Expiry of collective agreements

The existing collective agreement remains valid until it is superseded once a new one is signed.

Peace clauses

There is no obligation to hold industrial peace during the validity of a collective agreement. Collective agreements usually include clauses containing the procedure to follow in order to solve an industrial dispute.

Other aspects of working life addressed in collective agreements

The Collective Agreement for Public Service Employees 2017–2024 includes an upgraded structure of qualification allowances. The public administration emphasises the enhancement of qualifications and skills of its employees, so much so that it set up the Institute for the Public Services in collaboration with the University of Malta and Malta College of Arts, Science and Technology. This collective agreement also provides a new measure for employees who choose to work after reaching their retirement age. These employees can now take their pre-retirement leave once they retire from service.

A new measure was included in the latest collective agreements pertaining to companies operating in the banking sector. This involved the abolition of the traditional grade structure in favour of a ‘position-based’ system that relies on a job evaluation exercise. Such collective agreements also include a number of family-friendly measures, profit-sharing schemes, home loan schemes and study grants.

The agreement for teachers in state schools signed in 2017 includes the creation of a work resources fund. Teachers should be provided with up to 360 hours of training to help them to achieve quicker career progression. A change in syllabi is also addressed, in order to give teachers more autonomy and freedom during their lessons.

Legal aspects

The EIRA provides the legal framework for the eventuality of strikes. This act defines a trade dispute as a dispute between employers and workers, or between workers and workers, that is connected with any one or more of the following matters:

• terms and conditions of employment, or the physical conditions in which any workers are required to work
• engagement or non-engagement, or termination or suspension of employment or the duties of employment, of one or more workers
• allocation of work or the duties of employment between workers or groups of workers
• matters of discipline
• facilities for officials of trade unions
• machinery for negotiation or consultation, and other procedures, relating to any of the abovementioned matters, including the recognition by employers or employer associations of the right of a trade union to represent workers in any such negotiation or consultation or in the carrying out of such procedures
• the membership or non-membership of a worker in a particular trade union

The law does not specifically mention the legal types of industrial action but it refers to it as an act carried out by a person in contemplation or furtherance of a trade dispute and in pursuance of a directive issued by a trade union, whether the person belongs to it or not.

Article 63 of the EIRA provides immunity for trade unions and employer associations:

(1) (subject to the provisions of subarticle (2) of this article) no action in tort or quasi-tort shall lie in respect of any act:

(a) alleged to have been done by or on behalf of a trade union or by or on behalf of an employer association; or

(b) alleged to be threatened or to be intended to be done as previously mentioned, against the union or association in its own name, or against any members, officers or officials of the union or association on behalf of themselves and all other members of the union or association.

Article 64(4) states that:

An act done by a person in contemplation or furtherance of a trade dispute and in pursuance of a directive issued by a trade union, whether he belongs to it or not, shall not be actionable in damages on the ground only that it consists in a breach of a contract of employment; and any act done as aforesaid, not being an act in breach of a collective agreement, or of a settlement, decision or which is still binding in accordance with the provisions of article 70 or 72, or of a decision or award of the Tribunal, shall not by itself entitle the employer to terminate the contract of employment of, or discriminate against, any person doing any such act as aforesaid, and shall not constitute a break in the service of such person.

Developments in industrial action, 2012–2017

Note: n.a., not available.

Source: DIER (2013–2018); these data ceased to be collected in 2018.

Dispute resolution mechanisms

Collective dispute resolution mechanisms

Part II of the EIRA deals with the voluntary settlement of disputes providing for the setup of a conciliation panel. In Malta, conciliation and mediation are regarded as synonymous. Where a trade dispute exists or is apprehended, the parties to the dispute may agree to refer the dispute for conciliation. If the parties fail to nominate or to agree on the appointment of a conciliator or where an appointed conciliator reports a deadlock, the Director-General of DIER refers the matter to the minister responsible for employment and industrial relations. The minister may either:

• appoint a court of inquiry to investigate and establish the causes and circumstances of the dispute, or
• following an application by both parties to the dispute, refer such a trade dispute to the Industrial Tribunal

In cases where a voluntary settlement is reached, a memorandum with the terms of the agreement is drawn up and signed by the involved parties or their representatives. Such a settlement is binding on the parties and on the workers represented.

With regards to the public sector, the government and the trade unions agreed, in the Collective Agreement for Public Service Employees 2005–2010, on the setting up of a conciliatory structure. This is composed of a chairperson and two members, all three appointed by the government in consultation with the trade unions. Conciliation meetings are to be arranged prior to resorting to industrial action.

Individual dispute resolution mechanisms

Individual employees can resort to the dispute resolution services provided by DIER.

The DIER Investigative Unit investigates all types of alleged breaches relating to the conditions of employment and attempts to solve them without the need to refer such cases in front of criminal law courts. Cases involving discrimination and unfair dismissal are referred to the Industrial Tribunal. Inspections in workplaces take place if required, and once a breach is detected it is followed up by the appropriate officers. If the employer does not comply, the case is referred to the criminal law courts.

The Investigative Unit also offers its services to employees after the termination of their employment. The officers in this unit discuss any alleged breach of the labour laws and regulations with the claimant and possibly also with the employer in order to find an amicable solution. Failure to find a solution leads to the registration of a formal claim, and the matter will be investigated by the officer concerned. If still no settlement is reached, the matter will be referred to the police for court action.

The Industrial Tribunal consists of a chairperson and two members representing workers’ interests and employers’ interests, respectively, in cases of industrial disputes. In cases of alleged unfair dismissal, the tribunal comprises solely a chairperson. Its decisions are binding and may not be appealed against for a period of at least one year. In cases of unfair dismissal, the rulings may provide for the reinstatement or award of compensation of the employee concerned.

Use of dispute resolution mechanisms

Conciliation cases, 2012–2021

Note: n.a., not available.

Source: DIER (annual reports for the corresponding years).

New cases before the Industrial Tribunal, 2012–2021

Note: n.a., not available.

Source: DIER (annual reports for the corresponding years).

‘Individual employment relations’ refers to the relationship between the individual worker and their employer. This relationship is shaped by legal regulation and by the outcomes of social partner negotiations over terms and conditions. This section looks at the start and termination of the employment relationship and entitlements and obligations in Malta.

Start and termination of the employment relationship

Requirements regarding an employment contract

The EIRA defines a ‘contract of service’ and a ‘contract of employment’ as:

an agreement, (other than service as a member of a disciplined force) whether oral or in writing, in any form, whereby a person binds himself to render service to or to do work for an employer, in return for wages, and, in so far as conditions of employment are concerned, includes an agreement of apprenticeship.

This definition recognises a verbal agreement as enforceable by law. Legal Notice 267 of 2022 – Transparent and Predictable Working Conditions Regulations – which repealed Legal Notice 421 of 2002 – Information to Employee Regulations – regulates the information that must be provided to employees on paper or by electronic means. The information provided must include, among other things, information on the organisation, the place of work, the job title and description, the date of commencement, the duration of employment, the duration and conditions of the probationary period, training entitlements, paid leave entitlements, procedures related to employment termination, remuneration, working time arrangements and applicable collective agreements. Related clauses also exist for outworkers, temporary agency workers and those working outside Malta.

The minimum working age is 16. The Director of Industrial and Employment Relations can issue an authorisation for the employment of minors under 16 years if (1) an exemption certificate, obtainable from the Directorate for Educational Services, is produced and (2) the employer has carried out a risk assessment to confirm that the work is not dangerous for the minor. Commencement of employment must be registered at Jobsplus.

Dismissal and termination procedures

Dismissal and termination procedures are regulated by Section 36 of the EIRA.

If the employment is terminated during a probationary period, one week’s notice applies if the length of service is longer than one month.

After the expiry of the probationary period, the notice period increases according to the length of employment, up to a maximum of 12 weeks after 10 years of employment. Longer periods may be agreed by the employer and employee in the case of technical, administrative, executive or managerial posts.

If, on their own free will, the employee fails to give notice or does not work all the notice period, the employee is obliged to pay a sum equivalent to half of the wages due for the notice period not worked. If the employer does not allow the employee to work all or part of the notice period, the employer is obliged to pay a sum equivalent to the full wage due for the notice period not worked.

If the employment is terminated due to a justified cause such as an illness, the notice period is waived.

When an employer terminates employment due to redundancy, the employee can refuse to work the notice period or part of it, and the employer still has to pay the employee a sum equivalent to half of the wages due for the notice period not worked. If the employer does not allow the employee to work all or part of the notice period, the employer is obliged to pay a sum equivalent to the full wage due for the notice period not worked.

Should a post made redundant become available again within a period of one year, the employer is obliged to offer the job to the redundant employee.

An employer can dismiss an employee for a ‘good and sufficient cause’, and if the cause is valid then the notice period is waived. If an employee feels that they were unjustly dismissed they can initiate proceedings in front of the Industrial Tribunal on grounds of unfair dismissal, by means of a referral in writing consisting of a declaration stating the facts of the case. The referral must be produced within four months of the effective date of the alleged breach.

If a fixed-term contract of employment is terminated after the expiry of the probationary period without good reason, the party that breaches the contract is liable to pay the other party a sum equal to half the full wages that would have accrued had the contract of employment remained in force.

In redundancy situations, the employer must follow the procedure of last in/first out in the same category, regardless of whether an employee is on an indefinite or fixed-term contract. This procedure does not apply in cases involving businesses that are neither a limited liability company nor a statutory body, if the next in line for redundancy is a blood relative of the employer up to the third degree.

If a contract of service is terminated after at least one month of employment, the employee has the right to ask the employer for a certificate stating the duration of the employment, the nature of the work or services performed and, if the employee so desires, the reason for the termination of the contract and the rate of pay. However, the employer is not obliged to state the reason for termination of employment if the employment was terminated during the probationary period.

In cases involving collective redundancies, the employer must follow the procedures set out in Legal Notice 428 of 2002 – the Collective Redundancies (Protection of Employment) Regulations.

The dismissal and termination procedures in the public sector are regulated by Legal Notice 66 of 2017)– the Public Service Commission Disciplinary Regulations – by the Public Service Management Code and by the Collective Agreement for Public Service Employees 2017–2024.

Entitlements and obligations

Parental, maternity and paternity leave

According to the 2020 report on family-friendly measures relating to the public sector issued by the Institute for the Public Services (2021), the use of parenthood leave increased in 2020 when compared with 2019 by 43.62%. More specifically, there was an increase of 40.33% in the first 14 weeks of maternity leave, an increase of 42.14% in the number of workers availing themselves of the additional 4 weeks of maternity leave, an increase of 122.73% in parent (paternity) leave and an increase of 32.06% in parental leave. The increase in maternity leave is of interest, as this had been decreasing year on year, which may have been influenced by the COVID-19 pandemic. The increase in paternity leave, which was used exclusively by male workers, may indicate the increasing involvement of men in parental duties; however, a negligible number of men took up parental leave in both 2019 and 2020.

Statutory leave arrangements

Sick leave

The sick leave entitlement of an employee varies according to the relevant wage regulation order regulating the specific sector. If the type of activity of work does not fall under the remit of any wage regulation order, the sick leave entitlement of an employee is covered by Legal Notice 432 of 2007 – Minimum Special Leave Entitlement Regulations – and amounts to two working weeks per year. Sick leave has to be covered by a medical certificate, which must be presented to the employer. If an employee remains sick and exceeds three continuous working days of sick leave, the employer will deduct the sickness benefit from the social security to which the employee may be entitled from the fourth day onwards (in the event of continuous sick leave). If an employee remains sick after having exhausted all the sick leave entitlement, they will only continue to receive the sickness benefit from the social security to which they may be entitled. The law does not specify the relationship between exhaustion of the sick leave entitlement and the termination of an employment contract. In all cases, if an employee feels that they were unfairly dismissed they can present the case in front of the Industrial Tribunal. If an employee’s contract is terminated for any reason and there are still pending payments including those relating to sick leave to be settled by the employer, the employee may register a claim with the DIER Investigative Unit to recover such payments.

Retirement age

In 2006, amendments to the Social Security Act raised the retirement age from 61 to 65 years for both sexes. A person can still retire at the age of 61 if they have paid 35 years of national insurance contributions and were born between 1952 and 1961. Those who were born between 1962 and 1968 must have 40 years of paid national insurance contributions, while those born after 1968 must have 41 years of such contributions to be able to retire at the age of 61. Notwithstanding, someone who chooses to retire at 61 cannot work and receive the state pension until they reach 65 years of age.

For workers, pay is a reward for their work and their main source of income; for employers, it is a cost of production and a focus of bargaining and legislation. This section looks at minimum wage setting in Malta.

The average monthly basic wage increased in each sector measured between 2012 and 2022, with the average income for the second quarter of 2022 standing at €1,730, which is €440 greater than it was during the same quarter of 2012. Compared with 2019, however, although some monthly wages are higher, including those in the information and communication sector, the financial and insurance sector, the professionals, scientific and technical activities sector and public administration sectors, others are lower, including in manufacturing, mining and quarrying, and construction. Statutory wage increments are based on the COLA mechanism, although a national agreement on raising the minimum wage (over and above the COLA) was reached between social partners in 2017. Given the high rate of inflation, the 2023 COLA was the highest COLA since its inception in 1990. This was, in turn, eclipsed by the 2024 COLA. Continued economic growth has led to low unemployment and high levels of skill shortages in the labour market. Despite this, wage growth is considered to have been quite moderate, possibly owing to an increase in the labour supply, which is mostly due to an inflow of foreign workers.

Average monthly basic wage per worker – annual average (€)

Note: * Small sample size.

Sources: NSO (2013, 2020).

Minimum wages

Malta has a statutory minimum wage, which is established by Subsidiary Legislation 452.71, namely the National Minimum Wage National Standard Order. Moreover, the minimum wages of 31 different sectors are regulated by corresponding wage regulation orders and may be slightly higher than the national minimum wage.

The minimum wage is set according to the cost-of-living and inflation rates of the preceding 12 months as per Subsidiary Legislation 452.65. Minimum wage levels are adjusted on an annual basis and are based on an eight-hour working day. The cost-of-living adjustment is a result of the National Agreement on Industrial Relations signed on 10 December 1990 between the government and the trade unions and employer organisations represented on the Malta Council for Economic Development.

In April 2017, Malta’s social partners signed a national agreement on the minimum wage. The agreement became effective through Legal Notice 144 of 2017 and it provides for a gradual increase of the minimum wage based on a three-year period over and above the COLA. Due to high levels of inflation, the COLA reached a record amount of €9.90 a week in 2023. In 2021, the COLA stood at €1.75 a week, while in 2020 the COLA was €3.49 a week. During the budget for 2023, it was announced that, from December 2022, a novel additional annual COLA mechanism targeting vulnerable individuals would be implemented. Financed by the state, the payment was to target those earning less than the average wage and vary depending on individuals’ income and the number of individuals within their household. This additional measure will be revised upwards whenever the inflation rate surpasses 2% and when inflation in any three out of five categories (food, housing, utilities, household maintenance and health) is higher than the average over the past five years.

Weekly minimum wage (€), 2015–2022

Source: National Minimum Wage National Standard Orders (2015–2019).

According to the Economic Survey 2022 issued by the Ministry for Finance (through an analysis based on collective agreements of a representative sample of companies deposited within DIER), the collectively agreed weekly wage increased by €8.90 or 2.3% between August 2021 and August 2022.

Working time is ‘any period during which the worker is working, at the employer’s disposal and carrying out his activity or duties, in accordance with national laws and/or practice’ (Directive 2003/88/EC). This section briefly summarises the regulation of and issues regarding working time, overtime, part-time work and working time flexibility in Malta.

Working time regulation

Working time in Malta is set by Legal Notice 247 of 2003 – the Organisation of Working Time Regulations – by sectoral wage regulation orders and by collective agreements, which are generally conducted at company level. Generally, the normal hours of work of a full-time employee are 40 hours a week.

Overtime regulation

The EIRA defines ‘overtime’ as any hours of work in excess of the normal hours of work.

The minimum overtime rates in most sectors are stipulated in the respective wage regulation order that regulates their work activity. On the other hand, the overtime rates of those employees that are not covered by a wage regulation order are regulated by Legal Notice 46 of 2012, namely the Overtime Regulations. This legal notice states that these employees are to be paid one and a half times the normal rate for work carried out above a 40-hour week, averaged over a four-week period or over the shift cycle at the discretion of the employer.

Legal Notice 247 of 2003 – the Organisation of Working Time Regulations – gives the employee the right not to choose to work more than an average of 48 hours a week as prescribed by the regulations. Employees will be obliged to work overtime in excess of this average if they have given their consent in writing under the conditions stipulated by these regulations. The Protection of Maternity (Employment) Regulations gives the right to employees to refuse to work overtime during pregnancy and for a period of 12 months after either the birth of their child or the effective date of the adoption of a child.

Generally, overtime is compensated as follows: time and a half for any hours in excess of an 8-hour working day or of a 40-hour week, and double time for any hours worked on a Sunday or public holiday. However, as stated above, these rates vary in line with the wage regulation order covering the particular sector.

Individual contracts may contain clauses setting the rate of an allowance that also covers any overtime that may be worked. This can be done as long as the rate agreed is not below the minimum rates of pay set by the relevant legislation. Overtime rates in collective agreements usually reflect the rates set by legislation.

Part-time work

The EIRA defines a part-time employee as an employee whose normal hours of work, calculated on a weekly basis or on an average over a period of employment of up to one year, are less than the normal hours of work of a comparable full-time employee who is not a full-time employee with reduced hours. Part-time work is regulated by Legal Notice 427 of 2002, namely the Part-time Employees Regulations. The purpose of these regulations is:

(a) to provide for the removal of discrimination against part-time workers and to improve the quality of part-time work;

(b) to facilitate the development of part-time work and to contribute to the flexible organization of working time taking into account the needs of employers and workers.

Among other things, this legal notice grants part-time workers all entitlements enjoyed by a comparable full-time employee, such as holiday leave, sick leave and statutory bonuses on a pro rata basis. The number of individuals in part-time employment in Malta, as a proportion of total employment, has decreased annually since 2015. The proportion of both women and men working part time remains well below the EU27 average.

People employed part time in Malta and the EU27 (% of total employment), 2012–2020

Source: Eurostat Labour Force Survey [lfsi_pt_a] (people aged 20–64 years who are employed part time).

Night work

A night worker is defined as a worker who normally works at least three hours of their daily working time between 22:00 of any one day and 06:00 of the next day or works more than 50% of their annual working time between 22:00 of any one day and 06:00 of the next day. In the latter scenario, a collective agreement may provide for a lower proportion.

Shift work

The Organisation of Working Time Regulations (2003) define shift work as:

any method of organising work in shifts, whereby workers succeed each other at the same work stations according to a certain pattern, including a rotating pattern, and which may be continuous or discontinuous, entailing the need for workers to work at different times over a given period of days or weeks.

Certain work regulation orders provide for the entitlement of a shift allowance.

Weekend work

There is no definition of weekend work in the labour legislation. However, most wage regulation orders provide for the payment at a double rate for all hours worked on a Sunday.

Rest and breaks

The Organisation of Working Time Regulations (2003) define a ‘rest period’ as any period that is not working time and that does not include leave to which a worker is entitled. In cases where the working day exceeds six hours, at least 15 minutes of rest are to be granted to the worker. Workers are entitled to a minimum daily rest period of 11 consecutive hours between working days. Workers are entitled to an uninterrupted weekly rest period of 24 hours in addition to the 11 hours of daily rest within a 7-day period, or 48 consecutive hours in a period of 14 days in addition to the 11 hours of daily rest. The regulation provides that, in certain circumstances specified by the law, a worker may not take the full rest period. In such cases, however, the regulations provide that equivalent compensatory rest periods are given to the worker at times immediately following the corresponding periods worked. The regulations prohibit the practice of substituting rest periods with monetary compensation.

Working time flexibility

Employment legislation does not deal specifically with flexible working hours. The EIRA defines a full-time employee, a full-time employee with reduced hours and an employee with part-time employment. Flexible working hours are dealt with in clauses in collective and individual agreements. For instance, the manual on work–life balance measures for public sector workers (Office of the Prime Minister, 2022) includes procedures related to flexitime, reduced hours and teleworking arrangements. The percentage of public sector workers making use of these measures rose substantially between 2019 and 2020: reduced hours increased by 57.72%, teleworking increased by 33.04% and flexitime increased by 20.99% (Institute for the Public Services, 2021). It is likely that the uptake of such measures was accelerated or necessitated by the COVID-19 pandemic.

The adoption of flexible working arrangements in the private sector has gained importance in recent years, as indicated in the annual survey carried out by Misco on human resources developments in Malta. For instance, in 2018, 75% of the employers interviewed offered their employees the options of part-time work and reduced hours, 71% offered flexi-hours and 52% offered work from home or remote working (Misco, 2018). In 2020, the number of respondents who offered the option of remote working and flexi-hours to employees went up to 74%. This increase was fuelled by the restrictions brought about by COVID-19 (Misco, 2020). The move towards flexible working appears to have continued in 2021, with a PwC (2021) survey indicating that 18% of the workforce of organisations in Malta worked remotely every day and that a further 40% divided their time between in-person and remote work. In fact, few organisations that were able to offer remote working chose not to or intended to reverse the offer. Furthermore, 65% of organisations rated ‘improved work flexibility’ as the greatest organisational benefit of working during the pandemic.

Maintaining health and well-being should be a high priority for workers and employers alike. Health is an asset closely associated with a person’s quality of life and longevity, as well as their ability to work. A healthy economy depends on a healthy workforce: organisations can experience loss of productivity through the ill health of their workers. This section looks at psychosocial risks and health and safety at work in Malta.

Health and safety at work

The data below show that there was a constant decline in injuries in the workplace. This trend could be attributed to the effect of more awareness created through local media campaigns and on-site inspections.

Trends in injuries at work (national data), 2010–2021

Note: n.a., not available.

Source: OHSA (2022).

Psychosocial risks

Legislation on psychosocial matters is limited, with most health and safety legislation focusing on physical matters. The following exceptions refer to psychosocial matters.

The Occupational Health and Safety Authority Act (Chapter 424 of the Laws of Malta) refers to psychosocial risks at work in Section 4(2), which states that:

The Authority established by virtue of this Act shall be responsible for ensuring that the physical, psychological and social well being of all workers in all work places are promoted and to ensure that they are safeguarded by whoever is so obliged to do.

Section 6(2) of the same act provides the following:

The measures that need to be taken by an employer to prevent physical and psychological occupational ill-health, injury or death, shall be taken on the basis of the following general principles of prevention, that is by -

(a) the avoidance of risk;

(b) the identification of hazards associated with work;

(c) the evaluation of those risks which cannot be avoided;

(d) the control at source of those risks which cannot be avoided;

(e) the taking of all the necessary measures to reduce risk as much as reasonably practicable, including the replacement of the hazardous by the non-hazardous or by the less hazardous;

(f) giving collective protective measures priority over individual protective measures;

(g) adapting the work to the worker, particularly in so far as the design of work places, the choice of work equipment and the choice of working and production methods are concerned, in particular with a view to alleviating monotonous work and work at a predetermined work-rate, and to reducing their effect on health;

(h) by adapting to technical progress in the interest of occupational health and safety; and

(i) by the development of a coherent overall prevention policy which covers technology, the organisation of work, working conditions, social relationships and the influence of factors related to the working environment.

A few other legal notices also make mention of factors related to psychosocial matters. Among them, Legal Notice 36 of 2003, namely the General Provisions for Health and Safety at Work Places Regulations, mentions the importance of alleviating monotonous work and involving workers in consultations and participation.

Despite the scarce legal references to psychosocial matters, awareness on the topic has been steadily increasing in Malta. OHSA offers a framework document on tackling work-related stress, while an employee support programme is available to public sector employees. The programme aims to support those experiencing personal, emotional and/or behavioural problems that interfere with their work–life balance.

A study conducted in March 2020 by Misco found that 67% of workers across various sectors suffered from mental health issues due to their work, mostly due to anxiety and stress (Times of Malta, 2020a), with a follow-up study in 2022 indicating that this had risen to 79% of workers (Times of Malta, 2022). During 2022, several surveys emerged in relation to the impact of COVID-19 on employees in Malta, in particular highlighting the impact on mental health. Among them, one study found that 88% of healthcare workers felt that stress levels had increased during the pandemic, with a similar percentage perceiving that they did not receive enough mental health-related support during the pandemic (Diacono, Caruana and Zammit, 2022). A survey of teleworkers revealed that, while some felt that the period spent teleworking was beneficial for their health, a larger percentage attributed teleworking to having had a negative impact upon their health, with most of these attributing it to the development of mental health issues (Fiorini, 2022). 

Skills are the passport to employment; the more highly skilled an individual, the more employable they are. People with good skills also tend to secure better-quality jobs and better earnings. This section briefly summarises the Maltese system for ensuring skills and employability and looks at training provision.

National system for ensuring skills and employability

The Directorate for Research, Lifelong Learning and Employability is a directorate within the Ministry for Education that offers policy guidance on lifelong learning and initiatives for early school leavers. The directorate also organises around 400 adult courses in 77 different subjects, including vocational ones.

The National Skills Council was established in 2016 by means of the National Skills Council (Establishment) Order (2016). The council is made up of a representative appointed by each of the following stakeholders: the University of Malta; Malta College of Arts, Science and Technology; Jobsplus; the Institute of Tourism Studies; Malta Chamber of Commerce, Enterprise and Industry; and Malta Enterprise. It also comprises a representative of civil society, a representative from among lifelong learning specialists and the Permanent Secretary of the Ministry for Education. In addition, a maximum of four other people are appointed by the Minister of Education. Its role is to identify, anticipate and minimise skill gaps, in particular in sectors of significant importance for the Maltese economy. The council recommends, to the government, changes required in the relevant policy.

Training

Jobsplus, Malta’s employment services organisation, is the main entity that recommends policies and implements initiatives to assist jobseekers with entering or re-entering the active employment market. It provides various initiatives targeted at specific categories of people, such as young new entrants, older workers and disadvantaged groups, to develop their skills and competencies. Jobsplus also assists employers in relation to their recruitment and training needs.

The University of Malta and the Malta College of Arts, Science and Technology are the largest higher education institutions in Malta. They provide courses at various levels to thousands of students, thereby increasing the overall skills levels in Malta and helping to satisfy the changing needs of the labour market.

The Malta Further and Higher Education Authority was established in 2021 and replaced the National Commission for Further and Higher Education. Its aims include providing accreditation and quality assurance of further and higher education institutions, courses and programmes; recognising international and national qualifications; validating informal and non-formal learning; and providing research and policy recommendations related to further and higher education.

The principle of equal treatment requires that all people – and, in the context of the workplace, all workers – have the right to receive the same treatment, and will not be discriminated against on the basis of criteria such as age, sex, disability, nationality, race and religion.

Legal Notice 461 of 2004 – Equal Treatment in Employment – provides the legal basis for equality and non-discrimination at work. DIER is the body entrusted with ensuring equality at work. Claims by people involving discriminatory treatment, whether direct or indirect, in relation to employment are dealt with by the Industrial Tribunal.

Equal pay and gender pay gap

Paragraph 3A of Legal Notice 461 of 2004 – Equal Treatment in Employment – provides for the principle of equal pay for equal work.

In 2018, the gender pay gap in unadjusted form in Malta was 13%, which compares positively with that of the EU28 (Eurostat [SDG_05_20]). Eurostat data further show that this had decreased to 10% by 2020. National Statistics Office (NSO, 2022) data for 2020 show that, while the average gross annual basic salary for employees in Malta is estimated at €18,913, for men this stands at €20,051 and for women it is €17,454. The difference is also clearer on the island of Malta than on its sister island, Gozo. While male employees earned €2,735 more on average than female employees on the island of Malta, in Gozo men earned €281 more than female employees (NSO, 2022). Malta does not have any specific legislative support measures for addressing the gender pay gap or any particular (reoccurring) social partner initiatives with this goal.

Quota regulations

There are no legal obligations establishing quotas for women’s membership of public/private sector supervisory boards. An exception exists in relation to Parliament: a measure was introduced into law in 2021 to improve the representation of women and was implemented for the first time during the 2022 general election. Due to the measure, 12 extra seats were added in the House of Representatives and were assigned to women who would otherwise have failed to be elected. By virtue of this amendment, 22 members of parliament, or 28% of the members, are women.

The National Commission for the Promotion of Equality launched a Directory of Professional Women to identify qualified women in various fields by listing the qualifications, experience and skills of professional women. This can be a useful tool for their consideration in boards, committees and other decision-making positions. Moreover, in May 2016, a mentoring programme was launched to support women aspiring to hold decision-making positions. A research study about gender-balanced representation in decision-making that was published in December 2015 indicated that, while women are underrepresented in boardrooms and decision-making positions, the majority of women still feel that they work in an environment that promotes gender equality.

Act No. II of 1969 – the Disabled Persons (Employment) Act, Chapter 210 of the Laws of Malta – compels companies that employ at least 20 employees to employ a quota of disabled people, chosen from the Register of Persons with Disability. The percentage is established by the minister responsible through a legal notice, after consultation with Jobsplus.

Legal Notice 157 of 1995 – the Standard Percentage of Employment of Persons with Disability Order – sets the standard percentage at 2%. In April 2016, the government and employer associations signed a memorandum of understanding on the implementation of this threshold. Moreover, in 2019 a five-year agreement was signed between Agenzija Sapport, which is the national agency for people with disability, and Malta Employers’ Association in order to facilitate the employment of people with disabilities. Through this agreement, employers will be provided with services and training to support them in employing people with disabilities.

Employer organisations and confederations

• Malta Chamber of Commerce, Enterprise and Industry
• Malta Chamber of SMEs
• Malta Employers’ Association
   

Trade unions

• General Workers’ Union
• Union Haddiema Maghqudin
• Forum of Maltese Unions
• Malta Union of Teachers
• Malta Union of Bank Employees
• Malta Union of Midwives and Nurses
   

Government

• Department for Industrial and Employment Relations
• Jobsplus
• National Statistics Office
• Directorate for Research, Lifelong Learning and Employability

Central Bank of Malta (2014), Results of the 2014 Wage Dynamics Network for Malta, Valletta.

Diacono, S., Caruana, R. and Zammit, D. (2022), ‘Analysis on how COVID-19 is affecting health care workers’, Xjenza Online, spring issue, pp. 30–60.

Department of Industrial and Employment Relations (2013–2018), DIER annual reports, Valletta.

Department of Industrial and Employment Relations (2020a), Information about the Registrar of Trade Unions, Valletta.

Department of Industrial and Employment Relations (2020b), Report by the Registrar of Trade Unions 2019–2020, Valletta.

Department of Industrial and Employment Relations (2022), Report by the Registrar of Trade Unions 2021–2022, Valletta.

Eurofound (2020a), Collective agreements and bargaining coverage in the EU: A mapping of types, regulations and first findings from the European Company Survey 2019, working paper, Dublin.

Eurofound (2020b), Employee representation at establishment or company level: A mapping report ahead of the 4th European Company Survey, working paper, Dublin.

Eurofound (2020c), Industrial relations: Developments 2015–2019, Challenges and prospects in the EU series, Publications Office of the European Union, Luxembourg.

Eurofound (2020d), Minimum wages in 2020: Annual review, Minimum wages in the EU series, Publications Office of the European Union, Luxembourg.

Eurofound (2021), Working conditions and sustainable work: An analysis using the job quality framework, Challenges and prospects in the EU series, Publications Office of the European Union, Luxembourg.

Eurofound and Cedefop (2020), European Company Survey 2019: Workplace practices unlocking employee potential, European Company Survey 2019 series, Publications Office of the European Union, Luxembourg.

Eurostat (2011), ‘GDP per capita varied by more than six to one across the EU in 2010’, Statistics in focus, No. 64/2011, Luxembourg.

Eurostat (2015), Statistics explained: GDP per capita, consumption per capita and price level indices, web page, accessed 29 May 2024.

Fiorini, L. A. (2023), ‘Remote workers’ perceived health during the COVID-19 pandemic: An exploratory study of influencing factors in the IT and communications sector in Malta’, Industrial Health, Vol. 61, No. 5, pp. 342–356.

Institute for the Public Services (2021), Family-friendly measures – Research report for 2020, Floriana, Malta.

Malta Business Weekly (2022), ‘Misco’s HR report outlines four main challenges faced by today’s employers’, 10 November.

Malta Council for Economic and Social Development Act (2001), Chapter 431, Laws of Malta.

Malta Independent (2017), ‘Public service workers collective agreement to cost €17m in 2017, increases to €20.5m in 2024’, 20 April.

Ministry for Finance (2018), Economic survey 2019, Valletta.

Misco (2018), The annual survey on HR developments in Malta 2018, Birkirkara, Malta.

Misco (2019), The annual survey on HR developments in Malta 2019, Birkirkara, Malta.

Misco (2020), The annual survey on HR developments in Malta 2020, Birkirkara, Malta.

National Statistics Office (2013), Labour Force Survey 183/2013.

National Statistics Office (2020), Labour Force Survey 156/2020.

National Statistics Office (2022), Regional statistics Malta 2022 edition, Valletta.

National Statistics Office (2023a). Registered employment: August 2022, web page, available at https://nso.gov.mt/registered-employment-august-2022-2/, accessed 30 September 2024.

National Statistics Office (2023b), Registered employment: May 2023, web page, available at https://nso.gov.mt/registered-employment-may-2023/, accessed 30 September 2024.

NFTU (National Forum of Trade Unions) (2015), A national survey on trade unions in Malta.

OECD (Organisation for Economic Co-operation and Development) and AIAS (Amsterdam Institute for Advanced Labour Studies) (2021), OECD/AIAS ICTWSS database, version 1, Paris.

Office of the Prime Minister (2022), Manual on work–life balance measures, Valletta.

OHSA (Occupational Health and Safety Authority) (2022), Annual report 2021, Pietà, Malta.

The Organisation of Working Time Regulations (2003), L.N. 247, Employment and Industrial Relations Act, Laws of Malta.

PwC (2021), Beyond the pandemic – HR Pulse Survey 2021.

Registrar of Trade Unions (2019), Report by the Registrar of Trade Unions 2018–2019, Valletta.

Times of Malta (2014), ‘President launches national trade union forum’, 23 July.

Times of Malta (2020a), ‘67% experience mental health issues at work’, 5 July.

Times of Malta (2020b), ‘COVID-19: Staff at 200 companies on reduced working conditions’, 28 December.

Times of Malta (2022), ‘79% of employees experience work-related mental health issues – survey’, 8 August.