Employer of Record in Malta

The Maltese national minimum wage for 2026 is €222.42 per week, equivalent to approximately €963.82 per month for a full-time employee aged 18 or over (40-hour week). The figure includes the €4.66/week cost-of-living adjustment (COLA) applied for 2026. A reduced minimum wage of €214.78/week applies to workers aged 17, and €212.06/week to workers under 17. Wage Regulation Orders may set higher sector-specific minima (notably hospitality, security, contract cleaning). Beyond the basic wage, all employees receive statutory government bonuses (€270.20/year) plus COLA bonuses (€242.32/year) — totalling approximately €512.52 in mandatory annual bonus payments.

Maltese Class 1 Social Security Contributions (SSC) are split equally between employer and employee at 10% each on basic weekly wage, capped weekly. For employees born on or after 1 January 1962, the cap is €55.93/week each, applying once basic weekly wage exceeds €559. For those born before 1962, the cap is €49/week each (wage ceiling €490). Earners below €229.44/week pay a flat €23/week. Employers also pay a 0.3% Maternity Leave Trust Fund levy. Total employer cost is approximately 10.3% — among the lowest in the EU. Contributions fund pension, healthcare, unemployment, sickness and maternity benefits, administered by the Department of Social Security.

Malta uses progressive income tax under three rate schedules (single, married, parent). For 2026, the Budget expanded the tax-free band: under single rates, 0% to €12,000; 15% €12,001-€16,000; 25% €16,001-€60,000; 35% above €60,000. Married joint: 0% to €15,100; 15% to €23,200; 25% to €60,000; 35% above. Parent rates: 0% to €13,000; 15% to €17,500; 25% to €60,000; 35% above. Special regimes: part-time secondary income at 10% on first €10,000; non-managerial overtime at 15% on first €10,000 (where base wage ≤€20,000); Nomad Residence Permit holders pay 10% on qualifying foreign income (with 12-month exemption from issuance). Tax is administered by Malta Tax and Customs Administration (MTCA) through Final Settlement System (FSS) PAYE-style monthly withholding.

No. The Employer of Record uses its own already-registered Maltese employer infrastructure with the Commissioner for Revenue (PE number), JobsPlus (employment registration), Identità (for work permits) and the Department of Social Security (SSC employer registration). Your company hires the worker through the EOR via a service agreement, while the EOR holds the formal employment contract under Maltese law and files monthly FS5 returns and annual FS3/FS7 statements. This avoids the 3-5 day Malta Business Registry incorporation, €1,165 minimum share capital (€233 paid up), mandatory audited accounts, and ongoing corporate compliance — letting you start a Maltese hire in approximately 5-10 working days versus 6-12 weeks via own-entity setup.

Malta recognises indefinite-duration contracts (the default), fixed-term contracts (limited to 4 years aggregate before automatic conversion to indefinite), part-time contracts with pro-rata entitlements equal to full-time, casual employment, and temporary agency work. Probation is up to 6 months for standard roles or 12 months for managerial/executive/technical roles earning ≥2× minimum wage. All contracts must be written and given to the employee within 8 working days of commencement (Conditions of Employment Regulations) — this transposes the EU Transparent and Predictable Working Conditions Directive. Maltese contracts may be in English or Maltese; English is overwhelmingly used in business contexts.

Maltese employees are entitled to 216 hours of annual paid leave per year (approximately 27 working days for a 40-hour, 5-day-per-week pattern), one of the EU's more generous baselines. Public holidays falling on a weekday are additional. Sick leave entitlement: two working weeks fully paid by the employer per year, with longer absence covered by Sickness Benefit (flat-rate from social security) up to 156 days subject to medical certification. Maternity leave: 18 weeks total (14 weeks at full pay employer-funded, 4 weeks at flat-rate state pay). Paternity leave: 10 working days at full pay. Parental leave: 4 months unpaid per parent per child. New 2026 entitlements include 7 days miscarriage leave (before week 22) and 7 days child bereavement leave (loss of child under 18) under Legal Notices 274 and 275 of 2025.

Malta's statutory notice period scales with continuous service: 1 working day (under 1 month), 1 week (1-6 months), 2 weeks (6 months-2 years), 4 weeks (2-4 years), 8 weeks (4-7 years), and +1 week per additional year up to 12 weeks (over 10 years). Higher contractual notice is permitted. Pay-in-lieu of notice is permitted (employer pays basic wage for remaining notice). Just-cause termination (gross misconduct) requires no notice. No statutory severance exists under EIRA; redundancies follow last-in-first-out (LIFO) within the same role category, and redundant workers have a 1-year right of re-engagement. Wrongful dismissal claims go to the Industrial Tribunal which can award compensation up to the EIRA-specified maximum considering age, service, and prospects of finding alternative employment.

The Single Permit is the combined residence-and-work authorisation for third-country nationals, issued by Identità (formerly Identity Malta Agency) Expatriates Unit. Standard processing is 8-12 weeks. Three fast-track options reduce this to 5-15 working days: the Key Employee Initiative (KEI) for managerial/highly-technical roles earning €30,000+; the Specialist Employee Initiative (SEI) for specialised skills with gross annual salary ≥€25,000 (2026 threshold); and the EU Blue Card for highly-qualified workers earning at least 1.5× national average gross. The Nomad Residence Permit targets remote workers earning €42,000+ from foreign employer/clients with a flat 10% tax on qualifying foreign income and a 12-month exemption. The mandatory Skills Pass applies to hospitality and tourism roles (since 2024). EU/EEA/Swiss nationals require only eRESQ registration within 90 days.

The standard Maltese workweek is 40 hours, typically Monday-Friday. Maximum weekly hours including overtime is 48 hours averaged over 17 weeks under the Working Time Regulations transposing the EU Working Time Directive. Daily rest: 11 consecutive hours between shifts. Weekly rest: 24 consecutive hours plus the 11 hours = 35 hours minimum. Overtime premium is +50% over basic hourly rate after 40 hours, unless a higher rate applies under the relevant Wage Regulation Order or collective agreement. Sunday and public holiday work attracts +100% (double pay) under most WROs. Night work (typically 23:00-06:00) attracts +15% to +25% premium per applicable WRO and triggers mandatory health surveillance. Annual overtime cap and individual opt-outs from 48-hour ceiling are permitted with written employee consent.

iGaming is Malta's signature growth sector with the Malta Gaming Authority (MGA) regulating B2C and B2B licensees. Employers in licensed gaming companies face additional layers beyond standard EOR compliance: Key Function Holders (Compliance, AML/CFT, IT, Customer Services, Internal Audit, Finance, Marketing, Game Risk) require MGA approval and personal Probity Approval; AML/CFT obligations under the FIAU; mandatory responsible gaming training; and player protection requirements. The MGA's Skills Pass initiative (separate from tourism Skills Pass) certifies key technical roles. EOR providers active in iGaming maintain MGA-aware contract templates with appropriate confidentiality, IP, and post-employment restrictive covenants. Many iGaming roles are filled by EU-mobile staff and benefit from KEI/SEI fast-track permits where applicable. Sliema, St. Julian's and Gżira form the principal iGaming employer cluster.

Malta's combination is among Europe's most efficient: employer SSC capped at €55.93/week (~€2,909/year) per employee plus 0.3% MLTF levy, regardless of how high the salary climbs. Compared to typical EU costs of 25-35% employer social charges, an employer hiring a €100,000 worker in Malta pays only ~€3,200 in employer contributions versus €25,000-35,000 in many EU jurisdictions. The corporate side complements this: Malta's full imputation tax system with shareholder refund mechanism produces effective corporate tax rates of approximately 5% for foreign-owned trading companies. Mandatory annual statutory bonuses total ~€512.52/year (paid March, June, September, December). Employer cost of a typical €40,000 salary: €40,000 + €2,909 SSC + €120 MLTF levy + €512 bonuses ≈ €43,541 — fully loaded ratio of about 8.9%, exceptionally low for Western Europe.

Trade union membership and collective bargaining agreements (CBAs) are present but less dominant than in Northern Europe. The General Workers' Union (GWU) and Union Ħaddiema Magħqudin (UĦM) are the largest. CBAs are common in the public sector, banks, telecoms, port operations, drydocks, manufacturing, and parts of hospitality. Wage Regulation Orders (WROs) issued under EIRA set sector-specific minimum terms in industries without strong collective bargaining (e.g., contract cleaning, security services, hospitality). EOR providers ensure correct WRO/CBA mapping at hire — using the wrong WRO for a role is a frequent compliance error. The Industrial Tribunal handles unfair dismissal claims and trade dispute referrals. Right to strike exists subject to procedural requirements; lockouts are equally regulated.

Malta operates the Final Settlement System (FSS) — a PAYE-style monthly withholding regime. The employer withholds income tax and SSC each pay period, then files: FS5 monthly returns (showing total income tax + SSC + MLTF levy due) by end of the month following the pay month; FS3 annual statement of earnings per employee by mid-February; FS7 annual employer reconciliation by mid-February; mandatory electronic submission via the CfR portal. SSC contributions are paid in the same FS5 cycle. Late payment triggers interest at 0.6% per month plus penalties. JobsPlus engagement and termination notices must be filed within 7 working days of any contract start or end. EOR providers handle all FSS, JobsPlus and Identità reporting on the client's behalf, including FS3/FS7 year-end reconciliation and any audit response.

Own-entity setup: €1,165 minimum share capital (€233 paid up) + ~€1,500-€3,000 incorporation legal/MBR fees + €350-€500 annual MBR fees + €2,500-€8,000 mandatory annual audit (regardless of company size for most companies) + €4,000-€12,000 outsourced bookkeeping/payroll + ~3-5 days incorporation + ongoing corporate income tax filings + VAT compliance if applicable + Director's responsibility under the Companies Act. Total Year 1: approximately €10,000-€25,000. EOR cost: monthly fee per employee (typically €450-€800/month) covering full payroll, FSS, JobsPlus, statutory benefits, contract management, terminations and ongoing compliance — annualised ~€5,400-€9,600 per employee. Break-even: roughly 3-4 employees long-term, but EOR makes sense at any size for testing the market, short-term hires, or specialist roles where entity overhead exceeds value.

During the statutory 6-month probationary period (or 12 months for managerial/technical roles ≥2× minimum wage), either party can terminate with 1 week's notice if employed beyond 1 month, or no notice if under 1 month. No reason needs to be given during probation, and statutory unfair-dismissal protections do not apply for that period. However, discriminatory dismissal on grounds protected by the Equal Treatment in Employment Regulations (sex, race, religion, disability, age, sexual orientation, gender reassignment) is unlawful even during probation. Pregnant workers, employees on parental leave, and those exercising statutory rights cannot be dismissed even in probation. After probation, full unfair-dismissal protection attaches and dismissal must be for a substantive reason (gross misconduct, redundancy, capability) following correct procedure — Industrial Tribunal review available for up to 4 months after dismissal.

Beyond the statutory 27 days' leave, 14 public holidays, full sick pay, and €512/year statutory bonuses, competitive Maltese employers typically offer: private health insurance (often through MAPFRE Middlesea, Atlas Healthcare or Laferla — €400-€1,200/year depending on cover); private pension contributions (Voluntary Occupational Pension Schemes attract tax credits); flexible/remote working arrangements (very common in iGaming and fintech); relocation packages for international hires (1-3 months' rent, flights, settling-in allowance); fitness/wellness allowances; annual performance bonuses (typically 10-25% of base in finance and iGaming); company laptop and mobile; training budget; and increasingly, 4-day-week pilots. iGaming-specific perks include team retreats, free lunches and high-end office locations. Senior international hires often receive housing allowances given Malta's elevated rental market in Sliema/St. Julian's/Pendant.

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