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Employment Laws and Payroll in Malta

Employment Laws and Payroll in Malta

By: Jordan Hayes, Author
03 Sep 2025  ·  Views 1076  ·  2 min read
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Malta has a clear legal framework that protects employees and ensures payroll compliance for employers. Understanding these rules is essential for both businesses and job seekers. Below are the key points about employment laws and payroll in Malta.

Employment Laws in Malta

1. Employment Contracts

  • Every employee must have a written employment contract outlining job title, salary, working hours, and leave entitlements.

  • Contracts can be fixed-term or indefinite.

2. Working Hours & Overtime

  • Standard working hours: 40 hours per week (usually 8 hours per day).

  • Maximum weekly limit: 48 hours, including overtime.

  • Overtime must be paid at 1.5 times the normal hourly rate unless otherwise agreed in writing.

3. Minimum Wage

  • As of 2025, the national minimum wage is approximately €213 per week, increasing based on years of service.

4. Paid Leave & Public Holidays

  • Employees are entitled to 25 days of paid annual leave plus 14 public holidays.

  • Sick leave is available, with proof from a medical certificate.

5. Employee Rights & Protection

  • Protection from unfair dismissal and discrimination.

  • Maternity leave: 18 weeks, paid by Social Security.

  • Parental leave available under certain conditions.

Payroll in Malta

1. Salary Payments

  • Wages must be paid at least every four weeks (or monthly).

  • Employees receive a payslip detailing gross pay, deductions, and net pay.

2. Taxes & Social Security

  • Income Tax: Progressive rates from 0% to 35% based on income.

  • Social Security Contributions: Both employer and employee contribute (approximately 10% each, capped at a maximum amount).

3. Payroll Reporting

  • Employers must register with the Commissioner for Revenue and submit monthly payroll reports.

  • Deductions include income tax (FSS) and National Insurance contributions.

4. Bonus Payments

  • Employees receive mandatory statutory bonuses in June and December, typically €135.10 each.

5. Compliance

  • Failure to follow payroll rules may result in penalties and legal consequences.

Employment laws and payroll regulations in Malta aim to protect workers while ensuring fair business practices. Employers must stay compliant with wage, tax, and reporting obligations to avoid penalties.

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