Employers to face harsher fines for breaching employment laws

Updated 3.50pm 

Fines for employers who breach employment laws will be heavily increased according to proposed legal amendments that will start being debated in parliament on Monday.

Under the proposed amendments, the minimum fine will increase from €232 to €2,000 for a first-time breach, and can reach a maximum of €7,000 for a second offence.

“These amendments will better safeguard our workers and ensure a better quality of life, as they will serve as a stronger deterrent for abusive employers… We will not tolerate any abuse toward workers,” Parliamentary Secretary for Social Dialogue Andy Ellul said.

The amendments to the Employment and Industrial Relations Act will start being debated in parliament on Monday.

As things stand today, an employer who breaches employment laws by - for example, not paying an employee or not granting leave entitled to them - faces a fine of €232 that increases to a maximum of €2,000. The fine remains the same for repeat offenders.

“We felt this was not a strong enough deterrent, so we increased the fine to ensure that, what was the maximum fine is now the minimum,” he said.

Under the amendments, employers would be fined a minimum of €2,000 and a maximum of €5,000 for a first-time offence. This would increase to between €5,000 and €7,000 for a second offence.

He added that, through these amendments, the prescription period – the time between when an employer commits the crime and when she or he is charged in court - will be extended from one to two years.

“We’ve had cases of people being let off because of this technicality,” he said adding that the Department For Industrial and Employment Relations (DIER) was investigating some 500 work-related reports.

DIER director Diane Vella Muscat said that the department initially tried to resolve work-related issues outside court. But for those employers who refused to cooperate, the department now had stronger tools.

She said the types of reports received included: not being issued with a proper payslip, lack of leave entitlement and the unauthorised deduction of salaries.

'Not all employers are exploiters'- MEA

The Malta Employers Association on Friday backed the government's proposal to increase fines for employers who breach employment laws but called for "an environment where the private sector can be productive and competitive."

They called for better enforcement to ensure an "even playing field" as MEA members often complain that "they cannot compete in attracting and retaining the best human resources in a scenario where they must match offers of shady operators who circumvent regulations". 

"Malta Employers highlights the need to avoid stereotyping and generalising employers, creating the narratives that all employers are exploiters," the MEA said, adding that bad employers are in the "minority".

Zero tolerance for human exploitation - Temping Agency Association

The Association for Temping and Outsourcing Agencies on Friday also welcomed the proposed legal amendments introducing higher fines for those involved in the exploitation and trafficking of human beings.

"Human exploitation is a stain on any society, and it must be met with zero tolerance," said President Fabio Muscat, adding that AFTA had long called for stronger enforcement and serious consequences for those who abuse vulnerable individuals under the guise of employment.

AFTA said the harsher fines were a step in the right direction but there was even more to do to build a reputable, sustainable and future-proof labour market in Malta. 

The association called for more consultation among stakeholders to identify abuse of the system and confront these realities head on through "fair, enforceable and intelligent reforms that uphold justice, integrity and workers' dignity."