Understanding market competitive salaries in the Maldives is crucial for both employers and employees. A competitive salary attracts and retains top talent, while an uncompetitive one can lead to recruitment difficulties and high turnover.

Factors Affecting Market Competitive Salaries

Several factors influence what constitutes a competitive salary in the Maldives:

• Job Title and Industry: Salaries vary significantly across different professions and industries. For instance, hospitality roles in luxury resorts may command higher salaries than general service positions.
• Experience and Skills: Employees with more experience and specialized skills typically command higher salaries.
• Education and Qualifications: Educational attainment and relevant certifications can significantly impact earning potential.
• Location: Salaries may vary depending on the specific geographic location within the Maldives. Remote island resorts may offer higher salaries to compensate for the isolation.
• Company Size and Reputation: Larger, well-established companies might offer more competitive salaries compared to smaller ones.

Considering the Cost of Living

When evaluating salary competitiveness, it's important to factor in the cost of living in the Maldives. Housing, food, and other necessities can be expensive, particularly in resort areas.

The Maldives introduced its first-ever minimum wage regulations in January 2022. These regulations were established under Section 59 of the Employment Act (Law No. 2/2008), which gives the Minister of Economic Development the authority to set minimum wage or remuneration orders.

Minimum Wage Tiers

The minimum wage in the Maldives varies depending on the employer category:

• Public Sector: The minimum monthly wage for permanent public sector employees working at least 30 hours per week is MVR 7,000 (Maldivian Rufiyaa). The hourly minimum wage is set at MVR 33.65 according to section 3.1 of the Minimum Wage Order.
• Private Sector: The minimum wage for the private sector is determined by business classification:
  • Large Enterprises (not classified as Micro, Small or Medium Enterprises): MVR 38.46 per hour as per section 2.4 of the Minimum Wage Order.
  • Medium Enterprises: MVR 33.65 per hour.
  • Small Businesses: MVR 21.63 per hour according to section 2.5 of the Minimum Wage Order.

In the Maldives, employee bonuses and allowances fall into two main categories: mandatory benefits and discretionary benefits.

Mandatory Benefits

Mandatory benefits are those that employers are legally obliged to provide to their employees. These include:

• Probationary period
• Annual leave
• Public holidays
• Sick leave
• Maternity leave
• Paternity leave
• Overtime pay
• Notice period
• Severance pay
• Social Security (pension scheme)

Discretionary Benefits

Discretionary benefits are those that employers offer at their own discretion. These can vary depending on the company, industry, and position. Some common discretionary benefits in the Maldives include:

• Health benefits: This may include health insurance, dental care, or vision coverage.
• Ramadan Bonus: A bonus typically equal to one-third of an employee's monthly salary, paid before the holy month of Ramadan.
• Allowances: These can include:
  • Housing allowance: Especially helpful in expensive areas.
  • Transportation allowance
  • Meal allowance
  • Family allowance (for expatriates)
  • Child home care allowance (for expatriates)
  • Travel allowance (for expatriates)
  • Service charge (potentially)

Expatriate employees are generally entitled to the same benefits as Maldivian employees. Some employers may also offer additional benefits such as free accommodation, social security contributions, and unemployment benefits.

In the Maldives, the standard practice for payroll cycles is monthly payments for full-time employees. However, the frequency of payments can vary depending on the type of employment and the specific terms of the employment contract.

Monthly Payroll Cycle

The majority of full-time employees in the Maldives receive their salaries on a monthly basis. This is a common practice in many countries. Employers usually disburse salaries at the end of the month or within the first few days of the following month.

Payroll Cycle for Temporary Workers

For temporary workers, the Maldives permits more frequent pay cycles. These workers may receive their salaries on a daily, weekly, or bi-weekly basis, as outlined in their employment contracts. This flexibility is designed to accommodate the nature of temporary employment and the cash flow needs of these workers.

Role of Employment Contracts

The specific terms of the payroll cycle, including the frequency and timing of payments, are dictated by individual employment contracts. It's important for employees to carefully review their contracts to understand these details and ensure they receive their salaries as agreed upon.