Key Takeaways

  1. Partnering with an EOR allows businesses to hire local talent without establishing a legal entity in Malta.
  2. EOR providers in Malta handle important functions such as payroll, tax withholdings, benefits administration, and adherence to labour regulations.
    While EOR services offer flexibility and risk reduction, they can be costly for long-term operations and may limit direct control over employees.
  3. To choose the right EOR partner in Malta, companies must consider pricing transparency, local expertise, and client feedback, among others.

Malta, located in the Mediterranean, is a vibrant hub for international business. With a robust economy, favorable tax regimes, and a skilled, multilingual workforce, it offers an attractive environment for companies seeking expansion. In 2024, Malta’s GDP growth reached 5.0%, with projections indicating continued growth at 4.3% in both 2025 and 2026.

Malta’s economy is driven largely by sectors like tourism, financial services, information technology, and online gaming. The country’s strategic location, coupled with its membership in the European Union, makes it an ideal gateway for businesses targeting European and North African markets.

Given these advantages, many companies are keen to establish a presence in Malta. However, local employment laws and administrative requirements can be challenging. This is where Employer of Record (EOR) services can be beneficial, offering a way to hire and manage employees in Malta.​

What Is a Malta Employer of Record?

An EOR in Malta is a third-party organization that legally employs workers on behalf of another company. While the client company directs the day-to-day activities of the employees, the EOR assumes responsibility for employment-related tasks. These tasks include managing payroll, ensuring compliance with local labor laws, handling tax withholdings, and administering benefits.

What Is the Difference Between a Malta Employer of Record and a Malta PEO?

An EOR becomes the legal employer of the workforce, taking full responsibility for compliance, payroll, taxes, and benefits. This model is particularly beneficial for companies that do not have an established entity in Malta but wish to hire local employees.​

In contrast, a PEO operates as a co-employer where the PEO and the client company share employer responsibilities. The PEO manages HR functions, but the client company retains legal responsibility for its employees. This arrangement is typically suitable for companies that already have a legal presence in Malta and seek assistance with HR tasks.​

Choosing between an EOR and a PEO depends on the company’s size, objectives, and existing infrastructure in Malta. For businesses without a local entity, an EOR offers a straightforward solution to hiring and managing employees. Conversely, companies with an established presence may prefer a PEO to support their HR functions while maintaining legal control over their workforce.​

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How Does a Malta EOR Work?

A Malta EOR provider follows a series of coordinated steps to ensure smooth hiring and employee management.​

  • Hiring and Onboarding: The EOR manages the recruitment process, ensuring that employment contracts align with Maltese labor laws. They handle the onboarding of employees, including the collection of necessary documentation and the provision of mandatory training.
  • Payroll and Tax Compliance: The EOR administers payroll, ensuring timely and accurate salary payments. They calculate and withhold the appropriate taxes, including income tax and social security contributions, and remit them to the relevant authorities.
  • Benefits Administration: In Malta, employees are entitled to various benefits, such as paid leave, sick leave, and maternity leave. The EOR ensures that these benefits are provided following local regulations.​
  • Ongoing Compliance: The EOR stays abreast of changes in Maltese labor laws and ensures that employment practices remain compliant. They handle employment-related documentation, manage employee records, and address any legal issues that may arise.

How Labor Laws Affect Hiring in Malta?

Employers are mandated to comply with Maltese labor laws to have a successful operation.

Minimum Wage & Overtime

The national minimum wage in Malta is €229.44 per week for employees aged 18 and over. ​The standard working week in Malta is 40 hours. However, employees may work up to 48 hours per week, averaged over 17 weeks, provided they consent to the additional hours. Employees who work overtime are to be compensated at rates determined by the Wage Regulation Orders (WROs) applicable to them.

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Social Security Contributions

Employers and employees contribute to Malta’s social security system, which provides benefits such as pensions, unemployment assistance, and healthcare. The employer ensures that these contributions are accurately calculated and submitted.

Leaves

Employees in Malta are entitled to 24 days of paid annual leave, in addition to 13 public holidays. Sick leave entitlements vary by sector, but are generally up to two working weeks per year. Maternity leave is set at 18 weeks, with the first 14 weeks paid by the employer and the remaining four weeks covered by social security.​

Employment Termination

Termination notice periods in Malta range from one to 12 weeks, depending on the length of service. In cases of unjust dismissal, employees may be entitled to compensation. The employer must ensure that termination procedures comply with legal requirements and are handled fairly.

What Are the Benefits of a Malta Employer of Record?

Entering the Maltese market with the help of an EOR company offers several benefits. One of the most significant benefits is the ability to enter the market quickly. Establishing a legal entity in a new country can take time and involve complex administrative procedures.

With an EOR, companies can start operations almost immediately by outsourcing employment responsibilities to a local partner. Another key benefit is the reduction of financial and compliance risks. Employment laws in Malta, while not overly complex, must still be followed carefully.

By working with a Malta EOR company, businesses can be confident that payroll, taxation, and employee rights are being managed correctly. This reduces the likelihood of fines or legal disputes arising from unintentional non-compliance.

Lastly, using a Malta EOR service supports a lean and flexible approach to global workforce management. Businesses can scale teams up or down based on operational needs without being tied to long-term commitments or costly infrastructure.

What Are the Downsides of a Malta Employer of Record?

While there are many advantages to working with a Malta Employer of Record, there are also some challenges to be aware of. One such concern is the ongoing monthly service cost. EOR providers typically charge a fee per employee or a percentage of the employee’s salary.

For companies employing multiple staff members, this can add up over time, making it less cost-effective compared to setting up a local entity for long-term operations. Another limitation is the reduced level of direct control over employees. Although the client company manages daily responsibilities, the EOR is the legal employer.

This arrangement can occasionally create communication challenges or limit the company’s ability to enforce internal policies and performance management practices as fully as they would with in-house employees.

How to Choose a Malta Employer of Record

Selecting the right Malta EOR partner is important to the success of your expansion efforts. One of the first things to consider is pricing transparency. Reliable EOR providers should clearly outline their fee structures and avoid hidden costs. This includes specifying what services are included in the standard package and what will incur additional charges.

Experience and industry knowledge are also important. An ideal Malta EOR firm should have a track record of working with international companies, especially those in your sector. They must have a strong understanding of local employment laws and regulations in Malta. 

You should also consider the provider’s reputation and client feedback. Ask for client references and review online feedback, particularly from companies of a similar size or sector. A reputable EOR company should have case studies or testimonials available to support their claims.

Finally, evaluate how well the EOR understands Malta’s workplace culture. A provider that is in tune with local expectations and employment practices can help your business build a stronger relationship with its Maltese workforce, fostering better engagement and retention.

Engage a Malta Employer of Record with Remote People

If you’re considering expanding into Malta, partnering with Remote People can simplify the process. We provide direct Employer of Record (EOR) services that enable you to hire local talent, manage payroll, and stay compliant with Maltese employment laws—without the need to establish a local entity.

With deep local expertise, cost-effective solutions, and hands-on HR support, Remote People ensures a smooth and compliant entry into the Maltese market. Contact us today to get started with a trusted Malta EOR solution and take the next step in your global expansion journey.