The legislation on employment in Malta dates back in 1974 and it is incorporated in the Republican Constitution. The primary legislation is sourced by the Employment and Industrial Relations Act (EIRA), the Employment Commission Act and the Training Services Act. Other legal frameworks, defined as secondary legislations, are the Wage Regulation Orders that contain provisions about maximum hours of work and the minimum salary and all EU Regulations and Directives that refer employment.
According to the Malta Employment Act, an employer does not require a specific reason to dismiss employees. However, employment cannot be ended during the maternity leave for women. Upon dismissal, the Maltese company must give notice to the employee. The notice period begins the second day the employee was announced.
The same conditions apply when it comes to fixed-term employment contracts in Malta. However, any of the parties ending the contract before it expires is bound to pay a remuneration to the other party.
According to the Maltese laws, the dismissal of employees falls under very strict regulations. An employer may terminate a labor contract based on a good and sufficient cause. The term “good and sufficient cause” cannot be punctually defined which is why certain cases falling within these terms may be brought before the Industrial Tribunal that will decide if the dismissal was lawful or not. Redundancy and reaching the retirement age are considered legal grounds for dismissal in Malta.
When redundancy is the reason for ending employment, the “Last In, First Out” rule must apply, which means, an employer must dismiss the person last employed on the position affected by redundancy.
When termination of employment occurs, an advance notice must be provided. The notice must be given by both employer and employee, depending which has decided to terminate work relations. In Malta, the notice period must be calculated based on the period of time the employee has rendered continuous work for the Maltese company. The notice period is calculated as follows:
For executive, administrative, technical or managerial positions, longer notice periods can be agreed upon.
When terminating a work contract exceeding one month, the employer will give, at the employee’s request, a certificate stating the employment period, a description of the work rendered and the termination reason, if so desired. However, if dismissal happens during the probation period, the employer is not required to give a reason for termination.
For details about the Employment Law or company registration, you can contact our lawyers in Malta.
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