Malta: Latest working life developments – Q4 2016
Sharp reactions from employers about proposals to increase the minimum wage and the draft equality law, plus the continuing search for a partner for Air Malta, are the main topics of interest in this article. This country update reports on the latest developments in working life in Malta in the fourth quarter of 2016.
Debate about increase in minimum wage
The continuing debate about the minimum wage took a new twist when the Prime Minister stated it was time to increase it. In a recent report, the NGO Caritas Malta noted that, even though the number of families living below subsistence level has decreased, many families were not earning enough to satisfy their basic needs (PDF). A number of social justice non-governmental organisations (NGOs) launched a joint campaign on 29 October 2016 calling for an annual 3.5% increase in the minimum wage for three consecutive years. Following this new, and much more widespread pressure, Prime Minister Joseph Muscat, announced the government would raise the minimum wage and asked the social partners to find consensus about how and when this should happen.
In response the Malta Council for Economic and Social Development (MCESD), Malta’s tripartite national social dialogue institution, commissioned two economists to conduct two studies on this issue. These studies recommended that the minimum pay should be pegged to a ratio related either to the basic average wage or the median wage.
This led the employers’ associations to accuse the government and NGOs of populism, warning that this wage increase was likely to damage industrial companies and the business community. However, the Secretary-General of the General Workers Union (GWU) stated the increase in minimum wage should be complemented by a revision of the Retail Price Index which serves as a basis for wage increases. The General Secretary of the Malta Workers’ Union (UHM) stated that an impact assessment should be conducted to evaluate the effect of such an increase on low-pay economic sectors.
Equality bill causes concern to employers
A new draft law on equality presented in Parliament was heavily criticised by the Malta Employers’ Association (MEA). Its main concern is about the wide powers being given to the New Commissioner for Human Rights and Equality. The MEA President, Arthur Muscat, listed the following objections:
- the burden of proof is laid on the employer which means that the employer is already being considered as guilty;
- the number of definitions, offences and protected characteristics included in the bill may give rise to an orchestrated persecution of employers.
According to the MEA President, the bill may pave the way for frivolous litigation. Church schools fear that their policy of employing practising Catholics may be interpreted under the new law as being discriminatory. There was no reaction from the trade unions on this.
Issues at Air Malta continue
The government’s search for a strategic partner for Air Malta to make it more economically viable continued in the final quarter of 2016. During a meeting held at MCESD on 22 December, the Minister for Tourism, Edward Zammit Lewis, informed the social partners about the new developments. Some of social partners, representing the employers and the unions, were not satisfied with the information given. The four trade unions representing the various categories of Air Malta employees are waiting to negotiate and sign a new collective agreement.
As the employers had feared, the government accepted the demands made by various NGOs to raise the minimum wage. In its next meetings, MCESD is likely to recommend such an increase and government will probably act accordingly. The provisions in the new draft law on equality have been defined by MEA as ‘knee jerk reactions to extreme fringes of feminists and gay lobbies’. However, the government does not seem to be concerned about this criticism. The struggle by Air Malta to find a strategic partner has, to date, proved to be fruitless and the reassurances being given by the government are not allaying the concerns of the company’s employees and their unions.