Article 7 of the Constitution of Malta provides that “the State recognises the right of all citizens to work and shall promote such conditions as will make this right effective.” While this provision is not directly enforceable before the courts, it reflects the State’s commitment to promoting fair working conditions and safeguarding employment rights.
Employment Law Advice in Malta
Employment law in Malta is primarily regulated by the Employment and Industrial Relations Act (Chapter 452 of the Laws of Malta) and its subsidiary legislation. Malta is also influenced by international and European frameworks, including its obligations as a Member State of the European Union and its participation in the International Labour Organisation.
The Employment and Industrial Relations Act and subsidiary laws are aimed at providing the necessary framework for employees and employers to know their relevant rights and obligations. This Act mainly tackles issues related to wages, conditions of employment, discrimination in employment and other protective measures. One of its main focuses is on the regulation of employment contracts to serve as a security device between the employer and the employee. Employment contracts in Malta are generally classified into two main categories:
- Indefinite contracts, which are open-ended and continue until terminated in accordance with the law; and
- Fixed-term contracts, which are entered into for a specific period, task, or until the occurrence of a particular event, and must comply with statutory requirements.
Both types of contracts are subject to Maltese employment legislation, including rules on probation, termination, and minimum conditions of employment.
Indefinite Contracts
An indefinite contract does not specify an end date and continues until lawfully terminated. Either party may terminate the employment relationship, provided that the applicable notice period is observed. If the employer is terminating the employment relationship following the probationary period, the termination must be justified on the basis of good and sufficient cause.
Fixed-Term Contracts
A definite-term contract is entered into for a specific duration and must clearly indicate its terminating event, such as:
- a fixed date;
- the completion of a specific task; or
- the occurrence of a particular event.
Such contracts are subject to statutory safeguards. In particular, the premature termination of a fixed-term contract without good and sufficient cause may give rise to compensation, typically linked to the remaining period of the contract.
General Considerations
Both definite and indefinite contracts may be subject to a probationary period, in accordance with Maltese law.
The termination of employment is regulated to ensure the protection of both parties. Employees benefit from a range of statutory rights, while employers are subject to corresponding obligations, including compliance with tax, social security, and employment registration requirements.
In addition, Maltese law provides for a rebuttable presumption of employment in cases where a relationship, although labelled differently, satisfies criteria indicative of an employment relationship.
Maltese law requires employers to provide employees with clear written information outlining the principal conditions of employment within the prescribed statutory timeframe. These typically include:
- the role and duties of the employee;
- remuneration and any additional benefits;
- working hours and overtime arrangements;
- leave entitlements (including annual leave, sick leave, and parental leave);
- place of work; and
- notice periods and conditions governing termination.
Certain sectors in Malta are subject to Wage Regulation Orders, which establish minimum standards relating to wages, working time, overtime, and other employment conditions. These apply to specified industries, including, among others, construction, manufacturing, and transport.
Our Employment Law Practice
Employment lawyers at Chetcuti Cauchi provide assistance to clients in the case of identifying, managing and reducing business risks in areas related to labour issues, human resources and health & safety. Our services are directed at public or private companies, sole traders, employees or employee associations, where our team is well versed to:
- The negotiating, drafting and review of employment contracts for individual and recruitment agencies, collective agreements and service agreements in the case of self-employed clients;
- Advising in dispute resolution;
- The transfer of employment contracts in the case of mergers and acquisitions;
- the establishment of human resources policies, drafting of data protection policies and procedures;
- Regularly providing clients with updates in employment law;
- Work permit, residence permits and PE Number and social security applications and registrations;
- Ongoing legal support to HR and management teams of business clients;
- Drafting, negotiating and review of settlement agreements in the context of employment termination.
