Employer of Record in Malta

Businesses can only operate smoothly in Malta if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in Malta below, to avoid any compliance issues.

Employment Contract Requirements

The onboarding process in Malta spans five business days, requiring completion of documents a day prior to the commencement date. Contracts need to be composed in English, written down, and duly signed by both involved parties detailing:

• Name of parties Involved
• Commencement date of employment
• Length of the employment
• Job description
• Termination conditions

Onboarding Process

We can help you get a new employee started in Malta quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information onto the Playroll platform and completes any necessary local authority registrations. For non-nationals, the Right to Work assessment (if applicable) may add up to three extra days. Additional time may be needed for follow-ups on this assessment. Please note, payroll cut-off dates can impact the actual start date. Playroll's payroll cut-off date is the 10th of each month unless otherwise specified.

Working Hours in Malta

The typical daily working schedule consists of 8 hours, totaling 40 hours over a standard workweek, spanning from Monday to Friday. There is an option to extend the maximum workweek to 48 hours if necessary.

Overtime in Malta

Overtime compensation is mandatory for hours worked beyond regular schedules. Without written consent, the maximum weekly work limit is 48 hours. Extra hours are compensated at 150% of the hourly rate for work on Monday to Saturday and 200% for work on Sundays or Public Holidays.

Probation Period in Malta

The following details are relevant to probationary periods in Malta:

• For fixed-term contracts lasting from 6 to 15 months is calculated as two months for every 6 months of contract duration.
• For a fixed term contract lasting for more than 15 months, the probationary period will be 6 months.
• For contracts exceeding 15 months, the probationary period is fixed at 6 months.
• Employees in technical, executive, administrative, or managerial roles earning at least double the national minimum wage face a 12-month probationary period.

Fiscal Year in Malta

1 January- 31 December is the 12-month accounting period that businesses in Malta use for financial and tax reporting purposes.

Payroll Cycle in Malta

The payroll cycle in Malta is usually monthly, with employees being paid on the 25th of the month..

Minimum Wage in Malta

The minimum wage for employees in Malta is typically 4.81 EUR per hour, amounting to ~834.52 EUR per month for a typical 40 hour work week.

Bonus Payments in Malta

Malta's legislation does not include any regulations concerning 13th-month salaries.

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 10% on top of the employee salary in Malta.

Employee Payroll Tax Contributions

In Malta , the typical estimation for employee payroll contributions cost is around 10%.

Individual Income Tax Contributions

The personal income tax in the range of 0% to 35% is determined through progressive rates in Malta. Various factors, including household status and the number of children, may influence the overall tax rates.

Pension in Malta

Malta's pension system combines public and private components. The National Insurance Scheme (NIS) offers basic retirement benefits funded by contributions. Private pension schemes, like occupational and personal plans, provide additional retirement income options through voluntary contributions managed by financial institutions.

Mandatory Leave Entitlement in Malta

The annual leave entitlement in Malta is 24 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.

Public Holidays In Malta

In Malta, there are 14 legally mandated national public holidays annually.

Paid Time Off in Malta

in Malta, full-time employees are entitlement to 24 working days of paid leave. Part-time employees receive a pro-rata allocation based on their hours worked.

Maternity Leave In Malta

Pregnant employees with 6 months' consecutive service are entitled to 18 weeks' paid leave. They must take 4 weeks pre-birth, receiving full salary throughout. The employer covers the first 14 weeks, and Social Security handles the remaining 4 weeks.

Paternity Leave In Malta

Malta does not have legally mandated paternity leave.

Sick Leave In Malta

Employees are granted paid sick leave for a maximum of 10 days (80 hours). The payment rates and providers vary depending on the duration of the illness as follows:

• In Malta, sick leave ranging from 0 to 3 days is covered and paid by the employer at 100% of the base salary.
• Sick leave ranging from 0 to 3 days is covered and paid by the Social Security at 100% of the base salary.

Parental Leave In Malta

Male and female employees have the right to take up to four months of unpaid parental leave for childbirth, adoption, fostering, or legal custody until the child turns eight. To be eligible, the employee must have worked continuously for the same employer for at least 12 months.

Bereavement Leave

Employees are entitled to 1 day bereavement leave fully paid by the employer.

Marriage Leave

Employees are entitled to 2 day marriage leave fully paid by the employer.

Jury Service Leave

Employees have the right to fully paid jury service leave provided by the employer, lasting for the required duration.

Injury Leave

Employees have the right to fully paid injury leave provided by the employer, lasting for a maximum of 1 year.

Termination Process in Malta

In Malta, employers can validly terminate a fixed-term contract for the following reasons:

• Misconduct
• Redundancy
• Retirement age reached

Notice Period in Malta

In Malta, the required notice period depends on the length of service and the grounds for termination, outlined as follows:

• No notice period is required for employees with less than month service
• 1 week for an employee with between 1 and 6 months of service
• 2 weeks for an employee with between 6 months and 2 years of service
• 4 weeks for an employee with between 2 and 4 years of service
• 8 weeks for employees with between 4 and 7 years of service
• 9 weeks for employees with between 7 and 8 years of service
• 10 weeks for employees with between 8 and 9 years of service
• 11 weeks for employees with between 9 and 10 years of service
• 12 weeks for employees with more than 10 years of service

Severance in Malta

Mandatory severance pay is not specified within Maltese labour law.