Answer ... Indefinite and fixed-term employment contracts may be terminated by either party if there is ‘good and sufficient cause’. This term is not defined, but the law gives several examples of what does not constitute good and sufficient cause (eg, union membership, pregnancy or maternity leave, whistleblowing or the commencement of proceedings against the employer for breach of employment rights).

Employees are protected from termination by the employer during any period of incapacity for work caused by personal injury from an accident arising out of and in the course of employment, or by any of the occupational diseases specified in the Social Security Act, for a maximum period of 12 months. Similarly, an employee may not be dismissed while on maternity leave, and in the five weeks thereafter if she is incapable of working due to a pathological condition arising from pregnancy.

For both definite and indefinite contracts, the law imposes a probationary period, which the parties may contract out of. As a rule, during the probationary period the employment may be terminated at will by either party without any reason. One week’s prior notice of termination must be given if an employee has been in the employment of the same employer for a continuous period of more than one month. Special rules apply to employees who are pregnant or on maternity leave.

After the expiry of the probationary period, in the absence of good and sufficient cause, the employer may terminate the employment of the employee only in the event of redundancy. This term is not defined at law, and over the years there have been conflicting interpretations by the local tribunals and courts. The prevailing position is that a genuine redundancy is one where the employee’s job is abolished because it has become superfluous to the employer. On the other hand, the employee may terminate an indefinite-term contract by resigning at any time. In case of termination by the employer for redundancy and in case of the employee’s resignation, prior notice must be given.

As regards fixed-term contracts, if the terminating party does not have good and sufficient cause, early termination of the contract will give rise to a statutory obligation to pay the other party a sum equal to one-half of the full wages that would have accrued to the employee in respect of the unexpired period of the contract.

Under Maltese law, an employer is also entitled to terminate employment once the employee reaches pensionable age, as defined in the Social Security Act (Chapter 318, Laws of Malta)

Different rules on termination apply to public service employees.

Answer ... In case of termination of an indefinite-term contract, either by the employer for redundancy or by the employee through resignation, the terminating party must give prior notice to the other party. The minimum statutory notice period is based on the length of continuous employment with the employer:

• For employees who have been employed for between one and six months, the notice period is one week;
• For employees who have been employed for between six months and two years, the notice period is two weeks;
• For employees who have been employed for between two and four years, the notice period is four weeks;
• For employees who have been employed for between four and seven years, the notice period is eight weeks; and
• Thereafter, an additional week must be added for every subsequent year of service or part thereof, up to a maximum of 12 weeks.

The parties may agree to longer notice periods in the case of employees in technical, administrative, executive or managerial posts.

If an employee under an indefinite-term contract fails to give notice, he or she will be liable to pay the employer a sum equal to half the wages that would have been payable in respect of the notice period. If the employer fails to give notice in case of redundancy, it will be liable to pay the employer a sum equal to the wages that would have been payable in respect of the notice period.

Different rules on notice and termination apply to public service employees.

Answer ... For the purposes of Maltese law, ‘unfair dismissal’ is a termination by the employer:

• of an indefinite-term contract (other than during the probationary period) which is not effected solely on the grounds of redundancy or for good and sufficient cause, in accordance with the law on termination;
• which is made in contravention of the provisions of the law that protect employees who carry out acts in contemplation or furtherance of a trade dispute and in pursuance of a directive issued by a trade union, whether he or she belongs to it or not; or
• which, though made on the grounds of redundancy or for good and sufficient cause, is discriminatory.

Although ‘constructive dismissal’ is not referred to in Maltese law, the concept has been adopted by the Industrial Tribunal and the courts. Briefly, constructive dismissal is a form of dismissal whereby an employer has committed a serious breach of contract, entitling the employee to resign in response to its conduct. As a result, the employee is entitled to treat himself or herself as having been ‘constructively dismissed’ by the employer, and the employers conduct is seen as a ‘repudiatory breach’

An employee has four months in which to file a complaint before the Industrial Tribunal, which has exclusive jurisdiction to determine matters relating to unfair dismissal. However, this does not mean that an employee may not also file complaints with other competent authorities if a related matter falls outside the scope of the unfair dismissal claim.

The Industrial Tribunal may award compensation in case of unfair dismissal, and in limited cases may also order reinstatement. In determining the amount of compensation, the tribunal will consider the real damages and losses incurred by the worker who was unjustly dismissed, as well as other circumstances, including his or her age and skills, as this may affect his or her employment potential.

Both parties have the right to be represented during the proceedings and to present evidence and witnesses. A decision of the tribunal may be appealed on a point of law only.

Different rules apply to public service employees.

Answer ... For indefinite-term contracts, if notice was due to be given by the employer in the event of redundancy, the employee has a right to work that notice, or may choose not to work all or a part of it. In the latter case, the employer must pay the employee a sum equal to half the wages that would have been payable in respect of the unexpired period of notice. If the employer fails to give notice, it will be liable to pay the employee a sum equal to the wages that would have been payable in respect of the notice period.

No additional statutory severance pay applies.