Malta: Of Annual Leave, Payslips, Transfers Of Business And Temporary Agency Workers

On the 10th of August 2018, four Legal Notices came into force, amending existing employment laws and introducing new provisions therein.

The legal notice which is of primary and general interest is Legal Notice 271 of 2018 - The Annual Leave National Standard Order, which lays down minimum requirements related to the entitlement of annual leave in terms of the Organisation of Working Time Regulations. The Order answers many queries which are frequently asked by employers and employees alike and which so far have been subject to various interpretations and conclusions.

Leave is to be used on days as agreed between the employer and the employee. As from the 1st January 2019, the employer can only use up to twelve working days from the annual leave entitlement for the purposes of shut down, including a temporary closure of whole or part of the premises for bridge holidays or any other short periods of shutdown, thereby increasing the days which are to be granted as optional leave from the previous four days. Any type of shutdown, including a temporary closure of the premises by the employer, has to be communicated to employees by end of January of each calendar year. Once leave has been agreed upon, it can only be cancelled by agreement between the employer and employee.

In the case of employees on maternity leave, annual leave shall continue to accrue in the employee's favour. Any balance of annual leave which has not been availed of by the end of the calendar year shall be automatically transferred to the next calendar year when it has not been possible for the employee to avail herself of such leave during the year when maternity leave commenced. If a public or national holiday falls on a day of work or on a weekly day of rest not being Saturday or Sunday, the employee on maternity leave shall be entitled to the equivalent in hours of an additional day of annual leave.

For those employees who are on sick leave or injury leave, annual leave shall also continue to accrue in their favour. Any balance of annual leave unavailed of by the end of the calendar year shall be automatically transferred to the next calendar year when it has not been possible for the employee to avail himself of such leave during the year when the sickness or injury leave commenced.

Any pre-arranged leave which coincides with a period of maternity, sickness or injury leave is to be considered as not having been availed of and shall be availed of upon the employee's return to work or shall be carried to the subsequent year if such leave could not be availed of during the same year when the maternity, sickness or injury leave commenced. When the employment relationship is terminated, all balance of annual leave, including that accrued during a period of maternity leave, sickness or injury leave, must be paid by the employer.

The second legal notice, 272 of 2018 Temporary Agency Workers (Amendment) Regulations, amends the Temporary Agency Workers Regulations which came into force in 2010 and had remained unchanged since then. One major change is in the definition of what constitutes an agency worker. Before the amendments, a defining feature was whether the agency worker was working under the supervision and direction of the user undertaking. If the worker remained under the supervision and direction of the agency, one could argue that the worker was not a temporary agency worker and therefore not entitled to the protection and rights given by the Regulations. The amendments have removed this part of the definition and replaced it with a new, simpler and more practical requirement – the agency worker needs to be working at the place of work of the user undertaking. Furthermore, the principle of equal pay for agency workers has been broadened. Before the amendments, there was no obligation to provide for equal pay between the user undertaking's workers and agency workers when the temporary agency worker had an indefinite contract of employment/relationship with the agency and was paid between assignments by the agency. This limitation to the equal pay principle has been removed. Equal pay is not applicable for the first four weeks of the assignment, irrespective of the duration. If the worker is replaced at any time by another agency worker, even if during the first four weeks, the replacement is entitled to equal pay from the first day.

The Transfer of Business (Protection of Employment) Regulations were also amended by means of Legal Notice 273 of 2018. The most significant amendment to be introduced is a new proviso which provides that during negotiations leading to a transfer, there can be no changes to the conditions of employment of the employees affected by the transfer. This also seems to prohibit changes which might be agreed upon by the affected employees themselves.

The fourth legal notice, Legal Notice 274 of 2018, brought into force new provisions regulating payslips. The Itemised Payslips Regulations impose on employers an obligation to give to employees an itemised payslip either before or on the date when the wages are due, which payslips need to contain all the information as prescribed by the Regulations. The employer is not only bound to supply the employee with an itemised payslip, but if any proceedings are instituted against him, he must be able to present proof beyond reasonable doubt in order to free himself from any liability for failure to do so. If two payslips relating to the same period are presented to the Director for the Employment and Industrial Relations Department or before a court of law, the payslip which prevails shall be that which is more favourable to the employee. Contravention of these Regulations can result in a fine ranging from €500 to €1,165. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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