Unions in Malta have welcomed the government’s intention to honour its electoral promise of extra leave for workers – this entitles workers to time-off in lieu of public holidays which fall on a weekend. Employers have protested that this would increase their operating costs, and the government is adopting a gradual approach to the issue.
An amendment made to the National Holidays and Other Public Holidays Act (Chapter 252 of the Laws of Malta), which came into force on 1 January 2005, deprived workers of additional annual leave to compensate them for public holidays that fall on Saturday or Sunday. The amendment reads:
Notwithstanding anything contained in any other law, or in contract, or in any other instrument whatsoever with effect from 1st January 2005 when a National or Public Holiday listed in the schedule falls on a Saturday or on a Sunday, it shall not be deemed to be a public holiday for the purposes of entitling any person to an additional day of vacation leave.
There are 14 of these types of holiday during a calendar year and up to four of them may fall on a weekend in any one year. This amendment overrode not only the Employment and Industrial Relations Act (Chapter 452 of the Laws of Malta), which includes provisions about the entitlement to this additional leave, but also any clauses to this effect included in collective agreements.
This amendment was welcomed by employers and highly criticised by the trade unions. The General Workers Union (GWU) reported this case to the International Labour Organization (ILO), contending that since this amendment left no room for unions to negotiate on additional leave entitlement in lieu of public holidays falling on Saturday and Sunday, it restricted the freedom of trade unions’ rights in the collective bargaining process.
The ILO concluded that the government decision violated Conventions 87 and 98 on the freedom of association and the right to organise and bargain collectively. It recommended that the government should amend the National Holidays and Other Public Holidays Act in such way that employees covered by a collective agreement will receive an extra day’s leave for every day worked on a public holiday that falls on a weekend. The ILO also stated that if the Maltese government had amended the law on public holidays to mitigate the adverse effects of the economic crisis, the measures taken should be defined as being of a temporary nature. The government responded to the ILO saying that there was a possibility of reducing public holidays across the board, and committing itself to reviewing the law. However, no such measures were taken.
The issue came to the fore once more, early in 2017 during the General Election campaign, when the Labour Party (PL) said in its manifesto that if elected, it would reinstate workers’ rights to compensation for public and national holidays that fell on a weekend. In September, three months after winning the election, the Labour government announced its intention to implement this measure. The GWU, which had campaigned since 2005 for the amendment to be revoked, welcomed this.
However, the government chose to move cautiously. Various meetings were held by the Minister for European Affairs and Equality, Helena Dalli, with the social partners. The GWU’s suggestion that workers should be offered monetary compensation was swiftly dismissed by the minister as not in line with the rationale and spirit of the holiday entitlement. An option put forward by the minister was the introduction of bank holidays.
Employer associations protested vociferously. At a separate meeting with them, the minister suggested several options, though they were not made public.
A joint statement was then made by the four employer associations – the Malta Employers’ Association (MEA), the Malta Chamber of Commerce, Enterprise and Industry (MCCEI), the Malta Chamber of SMEs (GRTU) and the Malta Hotels and Restaurants Association (MHRA). In it, they said the increased operating costs resulting from the implementation of this measure might seriously erode Malta’s competitiveness and jeopardise its economic growth. They estimated that if during a year, four holidays occur on a weekend, the implementation of the measure would add about 2% to the total wage bill. They added that they did not consider the minister’s suggested options to be adequate. They called for real compensation to protect competitiveness and to ensure that the implementation of this measure is kept cost-neutral.
During the 2018 budget speech in the Maltese parliament on 10 October 2017, the Minister of Finance stated that workers would be given an extra day’s leave in part fulfilment of the government’s promise. Meanwhile, said the minister, talks between the social partners would continue, to work out how the measure might be implemented fully during this five-year term in government.
The key issue seems to be how this measure is to be implemented. The government appears to be more intent on accommodating the wishes of the trade unions than those of the employers, but it has not been insensitive to employers’ pleas. The aim of the piecemeal approach adopted by the government so far may be to dilute the conflict between the social partners. However elusive it may seem, the government is still intent on reaching the highest possible level of consensus among the social partners on this issue.