Employer of Record in Malta

How an Employer of Record works in Malta

An Employer of Record (EOR) is a company that acts as an employer on behalf of another business.

It is typically utilized by overseas business owners who want to hire local talent in a country where they don’t have a legal entity.

By using an EOR to act as the legal employer, an overseas business owner can quickly hire employees in Malta without the fuss of setting up a local entity.

The EOR will also handle the administrative aspects of hiring in Malta, including onboarding, payroll processing, accurate tax withholding, employee benefits administration, and contract terminations.

Rivermate’s EOR services are built on three pillars:

• Local HR experts who understand the market and employment laws.
• A network of partners that allows us to provide competitive benefits.
• The Rivermate platform that simplifies every aspect of the employment relationship.

Using Rivermate to hire employees in Malta ensures they’re supported by an experienced legal entity that understands local labor laws and practices.

Malta labor market: At a glance

The hiring market
Greatest hiring activity:	Valletta.
Hiring timelines:	A few days for local employees, much longer for expatriates.
In-demand sectors:	Finance, Tech, Fintech, iGaming.1 2
Sectors with skills shortages:	Tech, Research and Development.3

The salary market
Employer tax contributions:	Social security: 10% of each employee’s salary, capped for certain high-earning employees. Maternity fund: 0.3% of each employee’s salary.10
Weekly minimum wage:	€​​229.44 in 2026, rising to €​​239.85 in 2027.6 7
Average gross annual salary:	€27,384.8
Personal income tax rates:	Malta has a progressive income tax system with four brackets, charging 0%, 15%, 25% and 35% respectively.9

What will it cost to hire in Malta

Salary requirements

The statutory minimum wage in Malta is currently €​​229.44 a week. It will rise to €​​239.85 per week in 2027. However, minimum wage rules differ for certain sectors affected by Wage Regulation Orders (WRO).6 7

The average monthly salary for employees in Malta rose to €2,282 in Q2 2026, according to figures from the Maltese National Statistics Office.8

Employers in Malta are bound by its annual Cost of Living Adjustment (COLA), which implements mandatory wage increases to help employees combat inflation.

Employer contributions

Employers in Malta must make social contributions worth 10% of each employee’s salary.

However, these contributions are currently capped at €55.93 per week for workers earning annual salaries more than €29,084, provided they were born in 1962 or later. Historically, these rates tend to increase every year.11

Employers must also contribute to Malta’s Maternity Leave Fund at a rate equalling 0.3% of each employee’s salary.

Statutory benefits

The most notable statutory benefits for employees in Malta are the statutory bonuses and weekly allowances, both paid twice per year.

• Statutory Bonuses are paid every six months, in June and December;
• Weekly Allowances are paid every six months, in March and September.

The maximum statutory bonus is €135.10, and the maximum weekly allowance is €121.16.

Employees will receive the maximum if they have been in their job full-time for the entire six-month period, without taking any unpaid leave where bonuses do not accrue. If the employee does not qualify for the maximum, these bonuses will be paid pro rata.12

Employees working 40 hours per week are entitled to paid annual leave for the equivalent of at least four weeks and 32 hours (192 working hours). However, employees also receive additional leave when public or national holidays fall on their scheduled days off. So, for a standard Monday–Friday, 40-hour schedule, the entitlement is 216 hours in 2026, rather than just 192.

Annual leave for those working less than 40 hours per week is calculated on a pro-rata basis. Those employed for less than 12 months must receive a proportionate amount of annual leave.13

Employees are entitled to at least two weeks of paid sick leave per year, although this differs in some sectors bound by WRO. In any case, an employee must present a medical certificate to confirm their incapacity.`14

Female employees are entitled to 18 weeks of maternity leave, 14 weeks of which are fully paid by their employer. Statutory paternity leave is 10 days, fully paid.15 16

Employment Cost Calculator

Use our Employment Cost Calculator to estimate the cost of hiring employees in Malta.

What it’s really like hiring in Malta

Market condition	What an employer needs to know
Talent availability	Malta has a population of just under 600,000, but a lot of international companies are based there, so it can be difficult to compete for the best talent, especially in the tech sector.
Top-paying sectors	Finance, Insurance.8
Skills shortages	Tech, Research and Development.3
Key employer challenge	Competing for talented local workers.

Malta is a small island south of Italy with a population of just under 600,000. A lot of entrepreneurs and well-known international businesses have established a presence there, particularly in the tech sector. There are huge tax benefits available for doing so. In fact, Malta is regarded as one of the most attractive tax havens in Europe.1

This has created a competitive environment when it comes to hiring Malta’s most talented employees.

The capital city, Valletta, and its surrounding areas have a population of around 375,000, so naturally most job opportunities and talented employees are based there.4

The onboarding process is relatively quick for Maltese nationals, although there are several hurdles that can slow down the process of hiring expat workers.5

Employers in Malta need to calculate salary offers strategically

Maltese employees tend to demand lower salaries than many other EU nations. However, employers need to consider the mandatory bonuses offered to all Maltese workers.

Statutory bonuses and weekly allowances can cost employers up to €512.52 per year, per employee. Then, there’s COLA, which forces employers to boost salaries each year to help staff combat inflation.

It rarely works out in the long run for Maltese employers to offer sub-par pay, especially when hiring senior employees. The demand for employees in popular sectors like tech is so high that talented workers can consistently job-hop in search of bigger salaries. So, it’s often better to offer generous pay packages that encourage employees to stay put.

Working with an EOR with a strong knowledge of the Maltese employment market can help you offer employment contracts that work out fantastically for all parties.

Compliance risks that employers must know about in Malta

Employers must advertise roles to Maltese nationals before hiring non-EU expats

It’s possible for Maltese employers to hire expats from inside or outside the EU, provided they can obtain a work permit and the right to live in Malta.

However, a new labor law introduced in October 2025 states that businesses must advertise a job to Maltese nationals before they can hire a non-EU worker.

The job must be advertised on the Jobsplus portal and the EURES (European Employment Services) platform for at least three weeks within the two months before applying for a work permit for a non-EU hire.

There are some roles exempt from these requirements, but in general, Maltese and EU citizens must be given the first opportunity to apply for a vacant role.17

Calculating overtime pay can become complicated

Statutory overtime rates can vary wildly depending on the sector.

For sectors not bound by a WRO, overtime hours are paid at a rate of 150% of a worker’s normal wages.

However, the number of hours worked is calculated over a four-week period OR over another shift cycle at the employer’s discretion.

If an employer averages over 40 hours a week during one of these cycles, the extra hours should be paid at overtime rates.

But in an example scenario where an employee worked 46 hours one week, then 38 hours for the next three weeks, overtime pay wouldn’t be due.18

Terminating contracts isn’t always easy

If an employer wants to dismiss an employee, they must identify a good and sufficient cause for terminating the contract.

It’s possible to dismiss someone for poor performance in their role. In such cases, they don’t have to offer the employee a notice period. However, it’s suggested that the employer first warns the employee and follows due process to try and improve their conduct before firing them. Evidence of this process will serve them well in the case that the employee argues they were unfairly dismissed. If an employee challenges a dismissal as unfair, the case may be heard by Malta's Industrial Tribunal.19

A notice period will usually be served in the case of redundancies, resignations and retirements. The amount of notice depends on the tenure of the employee.20

Continuous length of service	Notice period
More than 1 month and up to 6 months	1 week
More than 6 months and up to 2 years	2 weeks
More than 2 years and up to 4 years	4 weeks
More than 4 years and up to 7 years	8 weeks
More than 7 years and up to 8 years	9 weeks
More than 8 years and up to 9 years	10 weeks
More than 9 years and up to 10 years	11 weeks
More than 10 years	12 weeks

If an employee with a fixed-term contract is dismissed early, they may be owed 50% of their wages for the remaining time on their contract.

All employees may also be owed outstanding wages, overtime, unused paid leave and statutory bonuses owed to them at the time of their termination.20

Probation periods can last up to one year in Malta

Probation periods can last up to 12 months for those in technical, executive, administrative or managerial roles earning at least double the national minimum wage. They can last up to six months for regular workers on indefinite contracts.

For those on fixed-term contracts, the maximum probation length depends on the length of their contract. Those with contracts lasting 16 months or longer can be offered a six-month probation.

However, in all the above cases, it’s possible for employers and employees to agree on a shorter probationary period.

Employees and employers can terminate contracts at any time during a probation period without having to give a good and sufficient cause. However, they must still serve a one-week notice period if they have been employed for a month or more.24

Benefits of hiring employees through an EOR in Malta

Working with an EOR allows you to enter the Maltese labor market quickly and inexpensively.

An EOR will also allow individuals with in-depth knowledge of Maltese labor laws to provide key HR services.

At Rivermate, we help employers by:

• providing a local business entity in Malta;
• handling all administrative aspects of running a Maltese business, including global payroll, taxes, benefits, and contract terminations;
• ensuring they remain compliant with all aspects of Maltese employment law.

This way, instead of worrying about social security contributions, compliant employment contracts and other complicated aspects of Maltese employment, you can focus on what you do best: managing your staff and growing your business.

Ready to hire in Malta?

Hiring in Malta involves more than discovering the best person for the job. From managing payroll, taxes and benefits to ensuring full compliance with local employment law, Rivermate handles all the administration so you can hire with confidence.

Talk to a Malta Hiring Expert

Sources:

1. https://nomadcapitalist.com/finance/legal-tax-reduction/setting-up-company-in-malta/
2. https://www.legal500.com/intelligence/malta/media-telecoms-it-entertainment/igaming-sector-in-malta-here's-what-you-should-know
3. https://economy-finance.ec.europa.eu/economic-surveillance-eu-member-states/country-pages-including-country-reports/country-report-malta_en
4. https://www.worldometers.info/population/largest-cities-in-malta/
5. https://www.maltatoday.com.mt/news/national/144495/businesses_report_work_permit_backlog_its_a_daily_struggle_
6. https://dier.gov.mt/en/services/employment-conditions/wages/national-minimum-wage/
7. https://lovinmalta.com/news/budget-2027-national-minimum-wage-to-increase-by-e10-41-per-week-including-cola/
8. https://lovinmalta.com/news/local/maltas-average-monthly-basic-salary-reaches-e2282-as-employment-rises/
9. https://taxsummaries.pwc.com/malta/individual/taxes-on-personal-income
10. https://socialsecurity.gov.mt/en/information-and-applications-for-benefits-and-services/social-security-contributions/social-security-contributions-class-1-2026/
11. https://taxsummaries.pwc.com/malta/individual/other-taxes
12. https://dier.gov.mt/en/services/employment-conditions/wages/bonus-and-weekly-allowances/
13. https://dier.gov.mt/en/services/employment-conditions/leave/vacation-leave/
14. https://dier.gov.mt/en/services/employment-conditions/leave/sick-leave/
15. https://dier.gov.mt/en/services/employment-conditions/leave/maternity-leave/
16. https://dier.gov.mt/en/services/employment-conditions/leave/paternity-leave/
17. https://www.angel-jobs.mt/news-articles/malta-labour-law-enforces-new-advertising-requirement-for-employers-hiring-non-eu-workers/read
18. https://dier.gov.mt/en/services/employment-conditions/wages/overtime/
19. https://practiceguides.chambers.com/practice-guides/employment-2026/malta
20. https://dier.gov.mt/en/faqs/termination-of-employment/
21. https://www.britannica.com/question/What-languages-are-spoken-in-Malta
22. https://workinginmalta.com/in-demand-jobs-malta/
23. https://www.officeholidays.com/countries/malta/2027
24. https://dier.gov.mt/en/services/employment-conditions/starting-a-new-job/probation-period/