# Hiring in Malta

> Machine-readable page from Hire with Columbus (https://hirewithcolumbus.com/), a flat-fee employer of record (EOR) service.
> Canonical page: https://hirewithcolumbus.com/hiring-guides/malta/
> Pricing: from $179/month per employee, one transparent flat fee with no percentage-of-salary markups and no setup fees (https://hirewithcolumbus.com/pricing/).
> To hire: tell us where you want to hire at https://hirewithcolumbus.com/get-started/ and onboard your first employee in 2-3 days.
> Last updated: 2026-07-25

## Overview

Malta requires a mandatory thirteenth salary, paid out as statutory bonuses across the year, not once at Christmas like you might expect. Miss this and you'll owe back payments the moment an employee (or a labor inspector) notices. Combine that with 18 weeks of maternity leave and 10.6 weeks of paternity leave, and you can see why "just hire someone in Malta" is rarely as simple as it sounds.

Most companies don't discover these requirements until they've already made an offer. By then, you're scrambling to figure out payroll compliance while your new hire waits for a start date. It's not a great look, and it's completely avoidable.

### Your three options for hiring in Malta

**Option 1: Set up your own entity**

- Cost: €10,000-50,000+ upfront, plus ongoing accounting, legal, and payroll admin costs
- Timeline: 3-6 months minimum for registration, tax setup, and banking
- Complexity: Full compliance with Malta's Employment and Industrial Relations Act, social security registration, and statutory bonus scheduling
- Makes sense when: You're hiring 20+ people and planning a permanent Malta presence

**Option 2: Hire contractors**

- Cost: No entity setup, but you lose control over how work gets done
- Timeline: Immediate, in theory
- Risks: Misclassification penalties if Malta authorities decide your "contractor" is actually an employee, plus back taxes and social security contributions
- Makes sense when: The engagement is under 6 months or highly specialized
- Note: Hire with Columbus also handles compliant contractor agreements and payments, so you're covered either way

**Option 3: Use an employer of record (recommended for most)**

- Cost: $179/month per employee
- Timeline: 2-3 days to get someone hired and working legally
- Complexity: None on your end. We handle the contract, payroll, taxes, and the thirteenth salary schedule
- Makes sense when: You're hiring 1-50 people, testing the Malta market, or building a team across multiple countries

### Why this math usually favors EOR

If you're hiring 1-10 people in Malta, entity setup costs more than 3-4 years of EOR fees combined. At $179/month per employee, three hires runs you $537/month total, compared to €20,000+ upfront plus €5,000+ a year just to keep the entity compliant.

The math gets even more lopsided if you're also hiring in other countries. Separate entities mean separate legal fees, separate payroll systems, and separate compliance headaches in every market. An EOR like Hire with Columbus handles employment contracts, payroll, tax filings, statutory benefits, and compliance updates, so you can hire in Malta this week instead of next quarter.

Ready to hire in Malta without setting up an entity or crossing your fingers on contractor classification? Get started with Hire with Columbus.

## Employment Types

Entity setup in Malta: €25,000+ upfront. EOR for 5 employees: $895/month. Let's look at why that math matters before you sign anything.

### How can you hire in Malta?

You've got three real options here, and picking the wrong one costs you time, money, or both. Here's how they stack up.

| Approach | Upfront cost | Timeline | Best for |
|----------|-------------|----------|----------|
| Set up your own entity | €25,000+ | 4-6 months | 20+ employees, permanent presence |
| Hire contractors | Minimal | Immediate | Short-term projects under 6 months |
| Use an EOR | $179/month per employee | 2-3 days | 1-50 employees, market testing |

**Setting up your own entity**

This means registering a Maltese company, getting a tax number, setting up local payroll, and building HR infrastructure from scratch. Expect €25,000 or more just to get the paperwork done, and that's before you've hired anyone.

Timeline runs 4-6 months in most cases, sometimes longer if the Malta Business Registry has a backlog. After that, you're on the hook for annual compliance filings, local accounting, and legal fees every single year.

This makes sense if you're committing to Malta long-term with 20+ employees. If you're not sure yet, this is a lot of money to bet on a maybe.

**Hiring contractors**

You can start working with a contractor tomorrow, no incorporation needed. That speed is tempting, but Malta's employment authorities look closely at how contractors actually work.

If your "contractor" works fixed hours, uses your equipment, and reports to a manager like an employee, Maltese authorities can reclassify that relationship. Misclassification fines add up fast once you factor in back taxes, back social security contributions, and potential legal disputes with the worker.

Contractors work well for genuinely independent, short-term engagements, think a 3-month design project or a specialist consultant. Hire with Columbus also handles compliant contractor agreements and payments, so you get the speed without drafting the paperwork yourself.

**Using an employer of record (recommended for most companies)**

With an EOR, Hire with Columbus becomes the legal employer in Malta on paper. You still manage the day-to-day work, set goals, run performance reviews, all of it.

We handle the employment contract, payroll, tax withholding, social security contributions, and benefits administration. Cost runs $179/month per employee, and you can have someone hired and working within 2-3 days.

Run the numbers on 5 employees: that's $895/month with an EOR versus €25,000+ to set up an entity you might not need in year two. For companies testing the Maltese market or building a small team, the EOR route removes the financial gamble.

### Employment contract types in Malta

Once you've picked your hiring approach, you still need to know which contract type fits the role. Malta recognizes a few standard employment contract types, each with its own rules.

| Contract type | Typical use | Key rules |
|--------------|-------------|-----------|
| Indefinite (permanent) | Core, ongoing roles | Standard notice periods apply, no fixed end date |
| Fixed-term | Project work, temporary coverage | Max 4 years before automatic conversion to indefinite |
| Part-time | Reduced hours roles | Pro-rata rights to leave, pay, and benefits |

**Indefinite contracts**

Most full-time core roles in Malta run on indefinite contracts, and that's the default most employers should reach for. These give employees standard protections around notice and termination, and they signal you're building a real team, not a revolving door.

Notice periods scale with tenure, currently averaging around 7.3 weeks based on length of service. Get this wrong and you're looking at wrongful termination claims, which nobody wants to deal with mid-project.

**Fixed-term contracts**

Fixed-term contracts work for genuinely temporary needs, like covering a maternity leave or running a defined project. Malta caps these at 4 years total, including renewals.

Cross that 4-year line, or use back-to-back fixed-term contracts to dodge permanent employee obligations, and the contract automatically converts to indefinite status. Maltese labor authorities watch for this pattern specifically, so don't try to get clever with rolling short-term deals.

**Part-time contracts**

Part-time employees in Malta get the same rights as full-time staff, just calculated pro-rata. That covers annual leave, the mandatory thirteenth salary, and social security contributions.

This matters if you're hiring someone for 20 hours a week instead of 40. You still owe them proportional benefits, not a stripped-down version of employment.

**How Hire with Columbus handles this**

Whichever contract type your role needs, we draft it to match Maltese labor law from day one. That means correct notice periods, proper fixed-term limits, and accurate pro-rata calculations for part-time staff, all without you needing to become a Maltese employment law expert.

## Payroll & Taxes

Your €60k employee actually costs about €66,500 a year in Malta once you add employer social security and the mandatory statutory bonus. That's roughly 10-11% on top of salary, lower than most EU countries, which is one of the reasons Malta is a popular hiring spot.

### Income tax brackets (2026)

Malta uses progressive income tax rates. Here's the standard single-person rate schedule:

| Income range (annual) | Tax rate |
|------------------------|----------|
| €0 - €9,100 | 0% |
| €9,101 - €14,500 | 15% |
| €14,501 - €60,000 | 25% |
| €60,001+ | 35% |

Married and parent computations use slightly different thresholds, so payroll needs to track which rate applies to each employee. Getting this wrong means either overtaxing your team or under-withholding, and you'll be the one explaining it to the tax office.

### Social security contributions

Both employer and employee pay 10% into Malta's Social Security Contribution (SSC) scheme, which funds old-age pensions, invalidity, and survivor benefits.

| Contribution type | Employer | Employee |
|--------------------|----------|----------|
| Old age, invalidity, survivors | 10% | 10% |
| Unemployment | 0% | 0% |
| Sickness/maternity | 0% | 0% |
| Health/long-term care | 0% | 0% |
| **Total SSC** | **10%** | **10%** |

Unlike some countries, Malta doesn't split contributions across a dozen separate funds. It's a flat 10% each side, which makes budgeting simpler than most EU markets.

### Payment schedule

Malta employees get paid monthly, typically at month-end. On top of salary, employers owe a mandatory statutory bonus (Malta's version of a 13th-month payment), paid in fixed installments across the year rather than as one lump sum tied to salary size. It's a small, flat statutory amount for every full-time employee, roughly €500/year regardless of pay grade, so don't budget it as a percentage of salary like you would in Brazil or the Philippines.

### Total employment cost examples

Here's what employer cost actually looks like across a few salary bands, including 10% SSC and the statutory bonus:

| Base salary | Employer SSC (10%) | Statutory bonus | Total annual cost |
|-------------|--------------------|--------------------|--------------------|
| €40,000 | €4,000 | ~€500 | ~€44,500 |
| €60,000 | €6,000 | ~€500 | ~€66,500 |
| €80,000 | €8,000 | ~€500 | ~€88,500 |

### Payroll cycle and deadlines

Malta runs payroll through the FSS (Final Settlement System). Here's the calendar you need to hit:

1. **Monthly**: Deduct income tax (via FS5 form) and SSC, and remit to the tax authorities by the 15th of the following month.
2. **Annually**: File the FS7 reconciliation and issue FS3 forms (annual pay statements) to employees by February 15.
3. **Ongoing**: Track bonus installment dates, since they're fixed by law and not flexible like a discretionary payment.

Miss the monthly FSS deadline and you're looking at interest charges plus administrative penalties, and repeated late filings tend to trigger closer scrutiny on everything else you file.

### Common payroll mistakes

- **Treating the statutory bonus as optional or salary-based.** It's neither. It's a fixed legal entitlement.
- **Applying the wrong tax computation** (single vs. married vs. parent rates) and under- or over-withholding all year.
- **Missing the 15th-of-month FSS deadline**, which racks up interest fast if it becomes a pattern.
- **Forgetting the annual FS3/FS7 reconciliation**, which is easy to overlook if you're used to countries without this extra filing layer.

### Cost comparison box

Setting up payroll in Malta yourself:

- Local accounting firm: €300-500/month
- Payroll software: €50-150/month
- Compliance risk: fines and interest charges that add up fast on repeated late filings
- HR expertise needed: €50k+ salary for someone who actually knows Maltese labor law

With Hire with Columbus: $179/month per employee (USD), fully compliant, zero risk. We handle the FSS filings, the bonus installments, and the SSC calculations, so you just approve payroll and move on with your day.

## Benefits & Leave

Maternity leave in Malta runs 18 weeks, and fathers get 10.6 weeks of paternity leave, well above what most companies expect from an EU market. Add in 24 days of annual vacation, 14 public holidays, and a mandatory 13th salary, and you're looking at a benefits package that's genuinely generous by international standards. Here's exactly what you owe employees and who's picking up the tab.

### Annual vacation

Every employee in Malta gets a minimum of 24 days of paid annual leave, which works out to just under five weeks. This accrues from day one of employment, so a new hire in March already has leave building up.

Unused vacation typically carries over into the next year, though many employers cap how much rolls over to keep things manageable. If someone leaves the company, you owe them a payout for any accrued but unused vacation days. Skip this and you're looking at a wage claim through the Employment Relations Board.

### Sick leave

Malta ties sick leave entitlement to the employee's collective agreement or Wage Regulation Order, but the general statutory floor is two working weeks (10 days) per year at full pay, covered by the employer. A medical certificate is usually required after the first day or two of absence, depending on company policy.

Once an employee exhausts employer-paid sick leave, they can apply for Sickness Benefit through Malta's Social Security system, which pays a flat weekly rate. This is one area where getting the paperwork right matters: miss a certification deadline and the employee (and sometimes you) can lose eligibility for social security cover.

### Parental leave

| Leave type | Duration | Pay |
|---|---|---|
| Maternity leave | 18 weeks | First 14 weeks paid (mix of employer and Social Security), remaining weeks unpaid unless otherwise agreed |
| Paternity leave | 10.6 weeks | Varies by employer policy and collective agreement |
| Parental leave (shared) | 8.7 weeks | Generally unpaid, available to either parent |

Maternity leave is one of the more generous entitlements in the EU, and it's not optional. Parental leave (separate from maternity/paternity) can be taken by either parent up until the child turns a certain age, and it's typically unpaid unless your company chooses to top it up.

### Public holidays in 2026

Malta has 14 public holidays in 2026. If an employee works one of these days, you generally owe them the public holiday plus their normal day's pay, or a substitute day off, depending on their contract.

| Date | Holiday |
|---|---|
| January 1, 2026 (Thu) | New Year's Day |
| February 10, 2026 (Tue) | Feast of St. Paul's Shipwreck |
| March 19, 2026 (Thu) | Feast of St. Joseph |
| March 31, 2026 (Tue) | Freedom Day |
| April 3, 2026 (Fri) | Good Friday |
| May 1, 2026 (Fri) | Worker's Day |
| June 7, 2026 (Sun) | Sette Giugno |
| June 29, 2026 (Mon) | Feast of St. Peter and St. Paul (Mnarja) |
| August 15, 2026 (Sat) | Assumption Day |
| September 8, 2026 (Tue) | Victory Day |
| September 21, 2026 (Mon) | Independence Day |
| December 8, 2026 (Tue) | Immaculate Conception |
| December 13, 2026 (Sun) | Republic Day |
| December 25, 2026 (Fri) | Christmas Day |

Note that a couple of these fall on weekends in 2026 (Sette Giugno on Sunday, Republic Day on Sunday), which means no substitute day off is legally required unless your contracts say otherwise.

### Mandatory benefits and who pays

Malta runs a straightforward split on social security contributions.

| Contribution | Employer pays | Employee pays |
|---|---|---|
| Social Security (old age, invalidity, survivors) | 10% | 10% |
| Unemployment, family benefits, sickness/maternity, health | Included in the 10% rate above | Included in the 10% rate above |

Both employer and employee contribute 10% of gross salary to Malta's Social Security system, which funds pensions, unemployment benefits, sickness assistance, and family benefits as one combined package. There's no separate private health insurance mandate, since Malta has national healthcare, but many employers still offer private cover as a perk.

The other big one: the 13th salary (called the "bonus" or statutory bonus in Malta) is mandatory. You're paying salary in installments beyond the standard 12 months, and skipping it isn't optional, it's baked into local labor law.

### Optional benefits that actually move the needle

Base compliance gets you in the door, but if you're competing for talent in Malta's tight labor market (unemployment sits at just 2.9%), you'll want to offer more.

- Private health insurance on top of national coverage
- Extra vacation days beyond the 24-day minimum
- Meal vouchers or lunch allowances
- Remote or hybrid work flexibility
- Performance bonuses beyond the mandatory 13th salary
- Professional development budgets

### Common mistakes companies make

Missing the 13th salary payment is the most common (and costly) mistake we see. It's not a discretionary bonus, it's a legal requirement, and back-paying it with penalties is more expensive than doing it right the first time.

Companies also frequently miscalculate vacation payout on termination, especially when an employee has accrued leave across multiple years. And more than a few employers assume Malta's healthcare system means they don't need to think about sick leave administration at all, which leads to missed certification deadlines and disputed claims.

Handling all of this correctly means tracking accrual schedules, managing certification deadlines, running the 13th salary calculation, and staying current on Wage Regulation Orders that vary by sector. A local HR hire to manage this properly runs €45,000 to €55,000 a year in salary alone, before you add benefits software and legal review.

Hire with Columbus handles all of this for $179/month per employee. We track vacation accrual, manage sick leave certification, calculate the 13th salary automatically, and make sure public holiday pay is correct every single time, so you're not the one finding out about a compliance gap after an employee files a complaint.

## Compliance

Miss one mandatory clause in a Maltese employment contract and the whole agreement can be challenged in front of the Industrial Tribunal. That's not a technicality, it's how Malta's Employment and Industrial Relations Act (EIRA) is set up. Get the paperwork right from day one and everything downstream (probation, termination, disputes) gets a lot simpler.

### Employment contract requirements

Written contracts are mandatory in Malta, and you need to hand one over within 8 working days of the employee starting.

The contract must include, at minimum:

- Job title and description
- Start date (and end date, if fixed-term)
- Salary, payment frequency, and any allowances
- Working hours and overtime terms
- Notice period
- Probation period length
- Applicable collective agreement, if one exists

Contracts can be in English or Maltese, both are official languages and either is legally valid. No government registration is required for standard contracts, but you do need to notify Jobsplus (Malta's employment agency) when you hire.

### Probation periods

Standard probation in Malta is 6 months for most roles, extending to 12 months for employees earning above a set salary threshold or in senior technical/managerial positions.

During probation, either side can terminate with just one week's notice, and you don't need "just cause" to do it. That flips the moment probation ends: full termination protections kick in on day one after the probation period closes.

### Working time regulations

Standard working hours are 40 hours per week (8 hours/day, 5 days/week) in most sectors.

Key rules:

- Overtime requires 1.5x pay unless otherwise agreed in a collective agreement
- Employees get a minimum 15-minute break after 6 hours of work
- Weekly rest of at least 24 consecutive hours is mandatory
- Employers must keep working time records for at least 3 years; Jobsplus can request them during an inspection

### Notice periods

Notice periods scale with length of service and apply symmetrically, meaning the employee owes you the same notice they'd be entitled to receive.

| Length of service | Notice period (both parties) |
|---|---|
| 1 month - 6 months | 1 week |
| 6 months - 2 years | 2 weeks |
| 2 - 4 years | 4 weeks |
| 4 - 7 years | 8 weeks |
| Over 7 years | 8 weeks + 1 week per additional year (max 12 weeks) |

Average statutory notice across all tenure bands works out to roughly 7.3 weeks, so budget for it when planning any exit.

### Termination process

Malta requires "good and sufficient cause" for dismissal outside of probation. Poor performance, redundancy, and misconduct are all valid grounds, but you need documentation.

1. Document the issue (performance review, written warning, or redundancy business case)
2. Give written notice matching the table above, or pay in lieu
3. Pay out any accrued but unused annual leave
4. Notify Jobsplus of the termination

There's no government pre-approval needed for individual dismissals. Collective redundancies (affecting a set number of employees within 30 days, depending on company size) trigger mandatory consultation with employee representatives before you can proceed.

### Severance pay

Malta doesn't have a fixed statutory severance formula for standard terminations.

| Situation | What's owed |
|---|---|
| Termination with cause | Notice pay (or payment in lieu) only |
| Redundancy | Notice pay + unused leave payout |
| Unfair dismissal (Tribunal ruling) | Compensation at Tribunal's discretion, based on service length and circumstances, potentially including reinstatement |

If the Industrial Tribunal rules a dismissal unfair, there's no cap formula, and reinstatement is always on the table as a remedy.

### Data protection

Malta follows GDPR, enforced locally through the Data Protection Act and the Information and Data Protection Commissioner (IDPC).

You need a lawful basis to collect and store employee data (contract necessity usually covers payroll and HR records), and employees have the right to access or correct their own data on request. Data mishandling can trigger fines up to €20 million or 4% of global annual turnover, whichever is higher.

### Common compliance mistakes

- Skipping the 8-day written contract deadline
- Setting probation longer than the legal maximum for the role's salary band
- Dismissing without documented cause after probation ends
- Forgetting to notify Jobsplus of hires or terminations
- Storing employee data without a documented lawful basis under GDPR

### Penalties for common violations

Common compliance failures in Malta:

- Missing or late written contract: fines between €465 and €2,330 per breach, plus the contract can be challenged as invalid
- Dismissal without just cause: Tribunal-ordered compensation (no cap) plus possible reinstatement order
- Missing mandatory clauses: contract deemed defective, exposing you to back-pay claims for disputed terms
- GDPR violations: up to €20 million or 4% of global turnover

Hire with Columbus builds every contract to EIRA standards, tracks probation deadlines, and handles Jobsplus notifications automatically, so none of this falls on your HR team's plate.

## Updates

If you hired someone in Malta last year, some of your numbers are already out of date. Here's what's different heading into the second half of 2026.

### Minimum wage went up again

As of January 1, 2026, Malta's statutory minimum wage sits at €994 per month. Malta adjusts this most years through cost-of-living mechanisms, so if you're budgeting off a 2025 figure, update it now. This matters even if you pay well above minimum, since some allowances and bonus calculations reference the statutory floor.

### Paternity leave got a real boost

Paternity leave jumped to 10.6 weeks as of February 23, 2026. That's a substantial increase from where it sat before, and it puts Malta well ahead of the EU's baseline minimum. If you've got new fathers on staff, or you're building out parental leave policies for a Malta-based team, this is the number to plan around now, not the old one.

### Annual leave and public holidays reset

Annual leave entitlement is confirmed at 24 days for 2026, and public holidays remain at 14 days per year. Malta calculates statutory leave using a formula tied to the standard 40-hour week and the number of public holidays, so these figures get revisited annually. Double-check your contracts reflect the current 24-day baseline, not a prior year's total.

### Thirteenth salary is officially mandatory

As of January 1, 2026, the thirteenth salary (paid as statutory bonuses across the year) is classified as mandatory, not customary. If you were treating this as optional or discretionary, that's a compliance gap worth closing immediately.

### Corporate tax rate holds steady

Malta reconfirmed its 35% corporate tax rate as of February 19, 2026. No change here, but worth noting since several EU jurisdictions moved rates this year and it's easy to mix up which country did what.

### What this means for you

None of these changes are dramatic on their own, but they add up fast if you're managing Malta payroll manually. This is exactly the kind of update Hire with Columbus tracks and applies automatically, so your contracts, pay runs, and leave balances stay current without you having to chase down every regulatory notice yourself.

Hire in Malta from $179/month per employee: https://hirewithcolumbus.com/get-started/

Best EOR shortlists and comparisons: https://hirewithcolumbus.com/best/