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Malta

Staff

Updated 07/2012

Legal requirements

Malta's constitution upholds a number of workers' rights such as:

  • the maximum number of daily working hours;
  • a weekly rest day;
  • minimum working age;
  • gender equality;
  • professional and vocational training for workers;
  • contributory social insurance;
  • the provision of subsistence means for those unable to work.

Employment conditions

Employment conditions are regulated by the Employment and Industrial Relations Act (EIRA).

When employing a worker, the employer should explain the conditions of work to the employee, and where no written employment contract has already been signed, give to the employee a signed statement showing the employee's basic conditions of employment.

Wages

Wages should be paid at regular intervals and not more than four weeks in arrears. The national minimum wage is established by a National Standard Order. For 2012, it is €158.11 (18 years & over), €151.33 (17 years), €148.49 (under 17 years). Other minimum wages applicable to specific industrial sectors are established by Wage Regulations Orders.

When the government announces a cost of living increase in its annual budget, every employer must add the amount of the cost of living increase to the employee's salary, as established by the Wage Increase National Standard Order.

Employers can only make deductions from the employee's wage, if, and where expressly permitted by law.

Working hours

The Organisation of Working Time Regulations stipulate:

  • daily rest period of 11 consecutive hours per 24 hour period;
  • weekly rest of 24 hours in a period of 7 days, or 48 consecutive hours in a period of 14 days, in both cases in addition to 11 hours daily rest;
  • rest break of at least 15 minutes, where the working day is longer than 6 hours;
  • 192 hours of paid annual leave for a 40 hour working week;
  • the need for the employer to have the employee's written consent to work over a weekly average of 48 hours.

The Employment and Industrial Relations Act enables the relevant minister to set the maximum weekly working hours (including overtime), minimum daily rest, weekly rest periods and annual leave. The minister may also make different provisions for different classes of employee.

Pension contributions

There are three different pension contributions payable for every person who is considered to be in insurable employment: one by the employed person, one by the employer and another by the state.

The rate of contribution by the employee and the employer is equivalent to 10% of the basic pay subject to a minimum contribution of €15.81 per week and to a maximum contribution of €37.85.

The state contribution is equivalent to 50% of the amount paid by the employer and that of the employee added together.

Communicating with businesses

Under the "Employee (Information and Consultation) Regulations", businesses employing at least 50 employees must inform and consult employees at their place of work on matters related to the company's activities.

Employment contracts

There are different forms of employment contracts, namely:

A fixed-term contract automatically changes into indefinite employment after four years of definite duration - if such contract does not include a justifiable reason for retaining the employee on a fixed term contract.

Fixed-term and part-time employees should be treated the same way as other employees unless there are objective reasons. The employer must inform them about vacancies of indefinite or full-time positions when these become available at the place of work. The employer should also give them access to vocational training and career advancement opportunities.

The probationary period , which applies in both definite and indefinite employment, is considered to be six months but if the post is technical, executive, administrative or managerial with a wage of at least double the minimum wage at law, probation is of one year. Probation can also be agreed for a shorter period. No reason may be given when terminating employment during probation, but a week's notice is required from either party, if the length of service exceeds one month.

Regarding indefinite employment, there is an obligation to give notice of termination of employment for both parties. For definite contracts, the party who terminates the contract before its expiry date must pay the other party a sum equal to one-half of the wages that would have been payable up to its expiry date. The obligation to give notice or payment is waived if there is a good and sufficient cause.

On termination of employment, outstanding wages and leave entitlement have to be settled by the next pay date.

If the conditions of employment agreed in a contract are less favourable than those of the EIRA, then the EIRA shall replace them. Exceptions are possible as may be authorised in cases of financial difficulty, to avoid redundancies and on a temporary basis that is revised every four weeks.

Employing foreigners

Posted Workers

Employees posted from undertakings established in the EU, EEA and EFTA countries do not require a working licence in Malta. However, the employer should notify the Department of Industrial and Employment Relations prior to the commencement of a posting.

Employed locally

Visas are not necessary for EU nationals who have the right to live and work in Malta if they are exercising any of their Treaty rights as workers, nor are they necessary for self-employed people, those who are economically self-sufficient or for students. However, the aforementioned will still need to apply for a work licence which is issued automatically. Family members of EU nationals have the right to join and accompany them in Malta.

The International Relations Unit coordinates:

  • social security regulations in the EU and the European Economic Area;
  • bilateral conventions Malta has with other contracting states, and other conventions it may have with any other future contracting states.

The case of Bulgarian or Romanian nationals is a little more complex as Malta reserves the right to apply transitional arrangements. This means that nationals of these countries must apply for a work permit.

There are minimum social rules to follow, especially about non-discrimination, gender equality and health and safety.

Administrative procedures

Starting and ending employment

The Malta Employment Corporation must be notified when new staff is employed from the day they take up their post. When contracts are terminated, the corporation must also be informed within four days of the contract's end.

Termination and engagement forms exist for these operations, which can be found in a variety of places and also downloaded from the Corporation's online section.

If this is the new employee's first job, they will need to present an ID card, an NI 3 form (from the Department of Social Security) and a work permit. In the case of dual citizenship, a certificate from the Department of Citizenship and Expatriates should be obtained.

Social security contributions

The social security contributions of self-occupied individuals are calculated as a percentage of the income declared from the relative trade and business of the preceding year. Payments are made in three instalments every four months. Self Occupied persons are those who earn income from trade, business, profession, vocation or any other economic activity that exceeds the Self Occupied threshold, currently €910.

The rate of contribution by a self-occupied person is equivalent to 15% of the annual income declared in the preceding year subject to a minimum contribution of €27.25 per week and to a maximum contribution of €56.78.

The state contribution is equivalent to 50% of the amount paid by the self-occupied person.

Wage contribution returns

The social security contributions of employees are paid through the employer who effects the necessary deductions from the wage payment. The contributions are remitted to the Inland Revenue Department on a monthly basis, accompanied by an FS5 (the employer's monthly payment advice).

Each year the employer must also submit to the Department a statement of earnings (FS3) in respect of each of their employees as well as an annual reconciliation statement (FS7). The FS3 shows the contributions deducted in respect of each employee in one calendar year. The FS7 shows the contributions paid in respect of the all the employees in one calendar year.

These forms can be submitted manually or online:

Work permits for foreign workers

EU, EEA and Swiss citizens (except Romanians and Bulgarians) do need to apply for an employment.

An application for the issue of an employment licence must be submitted 4 to 6 weeks before the start of employment date. You can not take-up employment before you are in possession of an employment licence.

Applications can be downloaded from and sent to the Employment & Training Corporation.

Record-keeping

As far as employment conditions are concerned, the employer should keep a register with the details of employees, also including records on working hours where it concerns employment of young persons, employees working over a weekly average of 48 hours and those performing night work.

Employers are also required, in terms of the Final Settlement System Rules issued under the Income Tax Management Act, to submit a monthly payment advice (FS5) accompanying the monthly payment of social security contributions and tax deductions relating to their employees. They are also required to submit annually a statement of earnings (FS3) in respect of each of their employees, as well as an annual reconciliation statement (FS7).

Dismissal

An employee under a contract of employment may contest unfair dismissal at the Industrial Tribunal within 4 months of the alleged unfair dismissal.

Specific regulations apply in cases of collective redundancies where employees' representatives need to be informed and consulted before such redundancies may take effect. The employer cannot terminate the employment of an employee effected by collective redundancy before the lapse of 30 days from start of consultations with the employees' representatives and notification to the Director Employment and Industrial Relations.

Resources

EURES, the European job portal, offers employers information and support on recruiting across the EU. As well as assisting jobseekers, it helps entrepreneurs find workers from across the EU. In border regions, EURES provides information on cross-border commuting and helps workers and employers with problems that may arise.

Programmes

You can make use of a number of training schemes and grants in order to provide either on-the-job training or on-going training to both current and prospective staff and employment schemes in order to recruit suitable staff.

A number of employment schemes are offered to employers seeking to recruit people from particular groups. These schemes allow employers to provide on-the-job training in order to facilitate the transition from unemployment to employment prior to recruiting the person.

Help & advice

Help & advice

SOLVIT helps businesses deal with problems that arise when national authorities wrongly apply EU market rules.

E-mail a business organisation near you

The EU runs a network (Enterprise Europe Network) of local business organisations in most European countries that may be able to help you.

Choose your country and town and enter your enquiry below.

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