• Employers with high termination rates will be blocked from employing new foreign workers
• Permit fees to rise and fall based on retention ratios
• TCNs who lose their job to get 60-day grace period
• No more cash salaries: payments via bank transfer
• Foreign workers must take course on Maltese culture before coming to Malta

Companies that hire and fire third-country nationals too often will face higher fees and enforcement and be blocked from registering new workers, a major new policy launched Wednesday proposes.

The labour force migration policy introduces measures to oblige employers to favour Maltese and EU workers, retain their non-EU workers and treat them well and encourages non-EU workers who are already working in Malta to stay, upskill and integrate into Maltese communities.

The policy is now open to public consultation for two months, with the government planning to start rolling out its measures later this year.

It is based on four principles: retaining existing workers, protecting workers' rights and conditions, aligning labour migration to workforce needs and refocusing migration on a skills-based approach.

The policy proposes 32 different measures.

Block on hiring

Small companies (employing between 10 and 49 people) will not be allowed to hire new workers if 50% or more of their third country national workforce leave or are fired in the previous 12 months.

For medium-sized companies – employing between 51 and 249 people – that threshold is 40%, and for large companies – employing 250 or more people – it is 35%.

There are some exemptions to the rule. 

This policy only applies for third country national workers. Maltese and EU workers will continue to benefit from the same rights they have today.

The measure will not apply to micro-companies that employ up to nine people.

Foreign direct investment that Malta Enterprise deems crucial for economic development, as well as companies in sectors focused on health, the care of persons with disability and the elderly are exempt from this measure. So too are student workers.

Thresholds were set after a labour market study that found some companies were changing their entire workforce twice annually, the government said. 

An employer who fires a worker due to a loss of business will not be able to hire another worker in that same position for the following 12 months.

Longer work permits

Most crucially, the government wants to encourage employers to retain as many of their workers as possible for as long as possible.

The policy will make life easier and decrease paperwork and expenses for companies that retain workers and treat them well. Counterwise, it will come down heavily on those caught cheating the system.

Employers will be able to renew their foreign workers’ permits every two years, not every year, as is currently the case – on condition that the worker is offered a two-year employment contract each time.

Change in permit fees

Work permit fees will also change. Currently, it costs employers €300 every year to renew each worker’s permit. The policy proposes halving that to €150 while also doubling the initial application fee for new hires to €600.

Permits for workers in specific sectors - healthcare, care for persons with disability and the elderly - will also be decreased.

The measure is intended to encourage companies to retain their existing employees, rather than hire new ones.

State authorities will be empowered to conduct desk-investigations to ensure compliance. Employers who are caught abusing their workers will be barred from hiring more staff.

The policy also aims to slow migration turnover caused by foreign workers who are already in Malta from being forced to leave after losing their jobs.

Non-EU workers who lose their job will be allowed to stay in Malta for 30 days until they find another job, provided they can financially support themselves throughout that time. They can then extend that period by a further 30 days, to a total of 60 days. The current grace period is 10 days.

Salaries must be paid via bank transfers

The policy will oblige employers to pay their third country national workers via bank transfers, the government said.

That provision seeks to end cash payments to such workers, allowing authorities to better monitor salaries and stop underpayment and abuse stemming mainly from fake payslips.

A study will also be carried out to determine the salary levels across skilled occupations, which will serve as a basis for establishing occupation-specific salary thresholds. This means employers will be expected to pay third country nationals a salary that reflects the market wage of each occupation.

Employers will also be required to make an additional effort to attract Maltese and EU nationals to a job posting before they issue a vacancy for third country workers.

Firms will be required to place a vacancy posting with Jobsplus and the European Union Employment Services (EURES) for at least three weeks before they opt to seek workers beyond the European borders.

Moreover, if they reject applications by Maltese or EU applicants, they will be required to provide a justification for that decision.

The policy states that new hires from countries deemed “high-risk due to security, public policy or public health concerns” will be automatically rejected. 

Hiring rules for new companies

New companies will also be obliged to employ a fixed number of Maltese or EU nationals before seeking workers from third countries.

Micro firms (which employ up to nine people) must first employ two full-time Maltese or EU nationals before hiring third-country nationals. 

Small firms (employing up to 50 people) must employ four, medium firms (employing up to 249 workers) must employ 20 and large firms must employ 40.

Learn about Malta before coming here

The policy also requires third-country national workers to undergo a short online course on the Maltese language, culture, history and way of life.

Before leaving for Malta workers must attend the “pre-departure integration course” to familiarise themselves with the culture and values of Maltese people. The measure is aimed to enhance workers’ integration in society – at work, in their neighbourhoods and in the community.

Workers in low-skilled roles will also be required to take upskilling and integration courses.

The skills card that was introduced for the catering and hospitality sector will be extended to other sectors – starting with the construction sector.

PM: 'necessary change'

Prime Minister Robert Abela said the reform will help the government to bring about “the necessary change” in migration flows and is part of the government’s vision for 2050.

“We will only allow the entry of workers who are needed for our labour market,” he said.

“Along the years the patterns of employment did not necessarily reflect what our economy needed, which is why we overhauled the policy for permits for third country nationals – based on what our economy needs the most.”

Times of Malta asked Abela whether he considered naming and shaming those employers who cheat the system but he explained that was not the government’s style.

Most companies are compliant and diligent, he said, and he believed the policy will nudge many of those who are still resistant to fall in line.

Those who continue to break the law will face very serious consequences, he added.

Empoyment Minister Byron Camilleri said the government could only implement such a reform because it sustained strong economic growth and boasts of full employment.

“We will address the labour market challenges the same way we addressed the stagnant economy and unemployment over the past years,” he said.

“We want stability – for the labour market, the workers and our society. We cannot continue to continually change workers – or worse – use them and discard them.”

On the other hand, workers who come to Malta must adapt to the culture and way of life of Maltese people, he said, and the Matese people have a duty to help them adapt and integrate.

“This is why we will be rewarding employers who retain their employees. Some people incorrectly believe that abuse on foreign workers does not affect Maltese workers. That’s wrong, it does,” he said, explaining that when employers abuse workers they’re abusing everybody, because they send out the message that if workers stand up for themseves they could be fired and replaced by a foreign worker

The public consultation process is open till February 9 and anyone can submit feedback on publicconsultation.gov.mt.

PN to take part in 'long overdue' consultation process

In a reaction, the Nationalist Party said the government was finally aligning with its policy on foreign workers in the labour market. 

For many years, the Labour government based its economic plan on quantity, creating a situation where Malta struggled to meet the demands of a growing population, including pressure on resources, infrastructure, services, and communities, the PN said. 

It described the public consultation on the proposed new government policy as long overdue, and recalled that four years ago,  PN Leader Bernard Grech proposed a national conference to find solutions to the ever-growing population issue caused by the influx of foreign workers.

"The PN  has always put forward clear and balanced proposals to address this complex issue, with an emphasis on identifying skills gaps and determining which skills are needed in our country, based on continuous labour market studies to safeguard Malta's national interest," the party said. 

It said a new PN government will consult with all stakeholders and evaluate every possible solution to manage foreign workers in the labour market fairly and sustainably.  

"The Nationalist Party remains committed to implementing a framework for workers from third countries that prioritises Malta's interests while ensuring efficient and humane processes. This policy aims to increase productivity and grow the economy without placing additional strain on infrastructure or the quality of life," it said. 

The party said it would contribute to the public consultation launched by the government by presenting its proposals after organising a series of meetings with stakeholders and conducting a detailed analysis of the government's proposals.

The PN statement was signed by Darren Carabott, shadow minister for home affairs, and Ivan Castillo, shadow minister for social dialogue.