Malta: Latest working life developments – Q2 2017
Disappointment over the minimum wage increase, plus proposals to compensate workers for weekend public holidays and to allow parents to take sick leave to care for children are the main topics of interest in this article. This country update reports on the latest developments in working life in Malta in the second quarter of 2017.
Agreement to increase minimum wage
The social partners represented at the Malta Council for Economic and Social Development (MCESD) reached an agreement to increase the minimum wage. However, this did not meet the expectations of the non-governmental organisations (NGOs) who had been campaigning for an 11% increase. The agreement entitles workers earning the minimum wage to an additional €3 per week upon completion of the first year of employment, and another €3 per week upon completion of the second year.
This increase is over and above the Cost of Living Allowance (COLA), based on the Retail Price Index. The increases are backdated to 1 January 2017, which means that anyone earning the minimum wage who had completed the first year of employment by that date will be entitled to the €3 weekly wage increase agreed at MCESD this year and another €3 weekly increase in January 2018. A Low Wage Commission is to be set up to review the adequacy of the minimum wage every four years.
Nevertheless, the NGOs who had campaigned for an 11% increase to be implemented over three years said that the increase would not make a tangible difference to the lives of the working poor. Economist Gordon Cordina, commissioned by the MCESD to study the issue and make recommendations, stated that the social partners had to act responsibly so as not to cause undue disruption in the economy.
Work-related issues in parties' manifestos
In the run-up to the general election on 3 June 2017, the main work-related issues in the political manifestos of the two leading parties were public holidays falling on a weekend and the entitlement of parents to take sick leave when their children are ill.
Following a 2005 amendment to the National Holidays and Other Public Holidays Act, public holidays falling on a weekend are no longer added to employees’ leave entitlement. The General Workers Union had called for this to be reversed, and had even referred the case to the International Labour Organization (ILO). However, the Malta Chamber of Commerce stated that the matter was closed.
The manifesto of the Labour Party (PL) promised that workers would once more be compensated for such days through an agreement with the social partners at MCESD. In addition, PL proposed reducing income tax for part-time work from 15% to 10%. The Nationalist Party (PN) proposed an increase in maternity and paternity leave, and allowing parents to take sick leave when their children are ill (a proposal that has been rejected several times by employers).
However, although PL won the election, there is no indication as yet about its plans to implement such a measure.
Since its inception in 1974, the minimum wage has always been increased through COLA. The increase in May 2017 was the first real minimum wage increase over and above COLA. However, a consensus regarding compensation for loss of public holidays falling on weekends, and about any possible attempt to enable parents to take sick leave when their children are sick, may prove to be elusive as the employer associations have strongly opposed such measures.