Malta sits at the crossroads of Europe, Africa, and the Middle East. It’s a tiny Mediterranean island with outsized appeal for companies building distributed teams. Malta’s tech sector contributes 7% to GDP and employs over 16,000 professionals across gaming, fintech, blockchain, and AI.
What makes hiring in Malta compelling is the infrastructure already in place for global work. English proficiency is nearly universal (96% speak it), even more than Maltese. The country offers a digital nomad visa program and has become the 10th-ranked destination globally for remote workers. With job vacancies surging 13% year-over-year in 2025 and unemployment rates lower than most European countries, Malta’s labor market is tight but growing.
For companies expanding internationally, Malta offers something rare: a skilled, English-speaking workforce in a location that bridges time zones between North America and Asia. The culture embraces remote collaboration. Almost a third of tech jobs are fully remote. You gain access to developers, engineers, and digital specialists without the friction of language barriers or cultural misalignment that can hinder distributed teams.
Malta may be small, but for companies seeking European talent with a global mindset, it delivers exactly what scaling businesses need. In this guide, we dive into why companies are strategically hiring in Malta and what they need to be aware of.
The Maltese labor market
Malta’s labor market is running hot. The employment rate reached 80% in the second quarter of 2025, with over 329,000 people employed, and an unemployment rate of just 2.7%.
The tech sector drives much of this growth, with employment expanding by 6.4% in 2025. Information and Communications Technology (ICT) specialists now make up 5.2% of the workforce, up from 4.7% in 2023, though talent shortages persist. Malta performs exceptionally well on AI adoption and business digitalization compared to other EU nations. However, challenges remain in getting smaller enterprises to adopt advanced technologies at the same pace as larger companies.
The government has invested heavily in digital infrastructure, allocating €285 million toward digital transformation initiatives. This includes a Digital Innovation Hub and support for blockchain, fintech, and gaming sectors. Strong internet infrastructure and widespread 5G coverage support distributed teams without the connectivity issues that plague other markets.
“Malta is one of the very few countries in the world with 5G nationwide coverage, and is now unparalleled in the EU. This investment benefits our economy in general,” said Harald Roesch, CEO of the country’s local network provider, Melita.
For employers, this means hiring into a competitive but capable market. The talent pool skews young and digitally fluent. About 39% of the working population holds a tertiary education. Companies hiring in Malta find professionals who already understand remote collaboration and expect flexibility as part of the employment deal, not a perk to negotiate.
How to hire in Malta
When you’re ready to recruit Maltese talent, you face the same fundamental choice as any international expansion. You can build your own legal infrastructure or work with a partner who already has it in place.
Establishing a local entity
This route means registering a company with Malta’s business registry and establishing your own legal presence. You handle payroll, benefits, tax compliance, and all employment responsibilities directly. The upside is complete control over operations and the ability to build precisely the structure you want.
The downside is setup time and cost. Establishing a local entity in Malta can take several weeks to potentially months, and involves considerable legal fees, incorporation costs, bank account setup, and ongoing administrative expenses. You’ll likely need in-house staff or local partners to manage Maltese employment law, which includes specific requirements around wages, working conditions, and employee rights under the Employment and Industrial Relations Act. This makes sense if you’re planning significant long-term operations with a larger team on the ground.
Working with an employer of record
An employer of record (EOR) becomes your legal employer in Malta while you manage the day-to-day work. They take care of the paperwork—employment contracts, euro-based payroll, tax withholdings, benefits setup, and keeping you on the right side of Maltese labor laws. No need to figure out foreign employment rules on your own.
This approach lets you hire employees in Malta in days, not months. You’ll pay a monthly fee per employee that covers everything: admin, payroll, and compliance support. Perfect if you’re testing the waters in Malta or building a distributed team without the full commitment of setting up a subsidiary.
Managing employment contracts in Malta
Employment relationships in Malta can be verbal or written, but written contracts are standard practice. Employers must provide new hires with either a written employment contract or a statement of minimum conditions within seven calendar days of starting work. This timeline matters. The faster you formalize the relationship, the clearer the expectations are from day one.
The contract must cover essential details like parties involved, job description, start date, workplace location, working hours, salary, leave entitlements, notice periods, and any applicable collective agreements. Probation periods are common and give both sides room to assess fit. One critical rule that governs all employment contracts in Malta is that they cannot offer terms less favorable than statutory minimums. Even if both parties agree, the law overrides any attempt to reduce employee protections below what’s legally guaranteed.
Fixed-term contracts are permitted but must have a legitimate justification. Indefinite contracts remain the norm. Malta also introduced new pay transparency requirements in 2025. Employers must now disclose salary ranges to job applicants before employment begins and provide existing employees with pay information upon request.
Maltese working hours, holidays, and leave
The standard workweek in Malta is 40 hours spread across five days. Full-time employees working this schedule are entitled to 192 hours of paid annual leave, equivalent to 24 working days. When public holidays fall on weekends, employees receive additional leave hours to compensate.
Malta observes 14 public holidays in 2025, including New Year’s Day, Good Friday, Labor Day, Independence Day, and Christmas. These holidays blend religious celebrations with national commemorations. Employees must take at least four weeks of their annual leave each year. Up to 50% of unused leave can be carried over to the next year with a written agreement, but only once.
Beyond annual leave, employees have access to sick leave, parental leave, and urgent family leave in cases of force majeure. The system is designed to protect work-life balance while giving employers and employees flexibility to coordinate time off. Malta takes leave seriously. It’s a right embedded in employment law and a non-negotiable benefit.
Employee benefits and social security contributions
Malta runs a comprehensive social security system that funds pensions, healthcare, unemployment benefits, and other protections. Both employers and employees contribute to this system through weekly payments based on gross income.
Social security contributions are structured into three classes:
- Class one. Paid by employed persons, split between employer and employee, each contributing 10% of gross weekly wages up to a maximum of €42.57 per week
- Class two. Paid quarterly by self-employed individuals based on declared income
- Class three. Paid by those earning income from rents, interest, or investments
Contributions are calculated for every Monday of the year, totaling 52 or 53 contributions depending on the calendar. These payments provide employees with access to invalidity pensions, widow’s and survivor’s pensions, unemployment benefits, and free healthcare services.
The government announced updates in 2025 that employers will soon be required to offer new employees the opportunity to join occupational pension plans. Understanding these contribution requirements is essential for accurately budgeting total employment costs.
Taxation and payroll Malta
Payroll in Malta operates on a monthly cycle, with employees typically paid on the last day of the month. As of January 2025, the minimum wage stands at €961 per month or €221.78 per week for workers aged 18 and over. Employers must withhold income tax and social security contributions before paying employees.
Malta uses a progressive income tax system with rates ranging from 0% to 35%. Single taxpayers pay no tax on the first €12,000 of annual income, then 15% on income between €12,001 and €16,000, 25% on income from €16,001 to €60,000, and 35% on anything above €60,000. Married couples receive slightly more favorable brackets. Tax rates shift based on marital status and whether couples file jointly or separately.
Employers handle all withholding and remittance responsibilities. Late payments or miscalculations result in penalties and interest charges. The tax year runs from January 1 to December 31. Foreign companies without local payroll infrastructure should work with an EOR or local payroll provider to ensure accurate calculations and timely compliance with Malta’s tax authorities.
Contractor vs. employee classification
Malta draws a clear line between employees and contractors, and that line is based on how the relationship actually functions. A contractor who works full-time under your direction, depends on your company for most of their income, and integrates into your team will likely be treated as an employee under Maltese law.
Malta uses an eight-criterion test defined in the Employment Status National Standard Order. If a worker meets five or more of these criteria, they’re legally considered an employee:
- 75% or more of their income comes from a single client over one year
- The company determines what work they do and how they do it
- They use tools or equipment provided by the company
- The company sets their schedule
- They cannot subcontract their work to others
- They’re part of the company’s hierarchical structure
- They play a significant role in company operations
- They perform tasks similar to those of existing employees
Misclassification carries serious consequences. You could face back payments for unpaid social security contributions, retroactive benefits including holiday pay and severance, fines, and legal costs. The financial gap between contracting and employment is narrower than it appears because contractor rates already include their personal tax burden.
According to 2025 revisions of Malta’s employment law, “The fine structure has been significantly revised, with first offenses now attracting penalties ranging from €2,000 to €5,000, compared to the previous range of €232.94 to €2,329.37,” write Dr. Franklin Cachia and Dr. Jianni Grima, senior attorneys at BDO. Getting classification right from the start protects your business and avoids costly disputes down the road.
Termination and severance in Malta
Ending employment in Malta requires following proper procedures. Notice periods depend on the length of service and are outlined in employment contracts or collective agreements. Employers can terminate for cause, redundancy, or other valid reasons, but the process must be fair and documented.
Dismissal without just cause can trigger severance obligations and wrongful termination claims. Employees with longer tenure receive stronger protections. Malta’s Industrial Tribunal handles employment disputes and has the authority to order reinstatement or compensation for unfair dismissal. The Employment and Industrial Relations Act provides the legal framework governing terminations.
Severance pay isn’t automatically required in all cases. It depends on the reason for termination and contract terms. Redundancies require consultation and may trigger severance payments based on years of service. Clear documentation throughout the employment relationship and termination process helps protect both parties if disputes arise.
Work permits and immigration
Hiring non-EU nationals in Malta requires work permits and proper immigration clearance. The process involves multiple steps and can take several weeks, so planning ahead matters. EU and EEA nationals enjoy freedom of movement and don’t need work permits, making them easier to hire.
Third-country nationals need a Single Permit that combines residence and work authorization. Employers must demonstrate they couldn’t fill the position with EU/EEA workers first. The application requires a valid employment contract, proof of qualifications, police conduct certificates, medical certificates, and evidence of accommodation in Malta. Processing times vary but typically run 4-8 weeks.
Malta also offers specialized permits for highly skilled workers and key employees under more streamlined procedures. The Digital Nomad Visa allows remote workers employed by foreign companies to live in Malta for up to one year if they earn at least €42,000 annually. Once granted, work permits tie the employee to a specific employer and role. Changes require new applications. Partnering with immigration specialists or an EOR can help navigate Malta’s permit requirements and avoid delays that disrupt hiring timelines.
FAQs
Expanding into Malta raises practical questions about culture, costs, and compliance. Here are the answers to what employers ask most when building teams on the island.
What is the work culture in Malta?
Maltese work culture blends Mediterranean warmth with British-influenced professionalism. Communication tends to be direct and collegial, with teams collaborating well while maintaining clearly defined roles. The workplace values family-focused environments, team consensus, and work-life balance, with employees expecting both professional respect and personal connection. Relationships matter as much as results in Malta’s business culture.
What is a good salary in Malta?
Competitive salaries in Malta vary by sector and role. Tech professionals typically earn between €30,000 and €60,000 annually, with senior developers and specialized roles commanding higher ranges. Malta’s cost of living is moderate compared to other EU countries, though housing in popular areas can be expensive. Salary packages often include strong benefits, pension contributions, and annual leave that enhance overall compensation value.
Can I hire in Malta without a local business entity?
Yes. Through an employer of record like Pebl, you can legally hire, onboard, and pay employees in Malta without establishing your own entity. The EOR manages local compliance, payroll in euros, benefits administration, and all employment responsibilities while you handle day-to-day management. This approach lets you expand into Malta quickly without the time and cost of setting up a subsidiary.
What jobs are in high demand in Malta?
Malta’s tech sector drives most of the demand for skilled workers. Python, JavaScript, AWS, and cloud computing skills top employer wish lists. Gaming, fintech, blockchain, and AI roles see particularly robust growth as the sector expands 6.4% year-over-year. Cybersecurity specialists, software developers, data analysts, and digital marketing professionals are consistently sought after as Malta positions itself as a Mediterranean tech hub.
Hire in Malta with Pebl
Expanding into Malta with Pebl means skipping the complexity of setting up your own entity while still accessing one of Europe’s most strategic talent markets. Pebl is an EOR in Malta and over 185 other countries, giving you a single platform to hire, pay, and manage employees in Malta and beyond.
From employment contracts and euro-based payroll to benefits administration and compliance with Maltese labor laws, Pebl handles the operational details so you can focus on building your team. Pebl makes it happen quickly and compliantly, whether you’re hiring your first Maltese developer or scaling a full Mediterranean hub. Get in touch to learn more.
This information does not, and is not intended to, constitute legal or tax advice and is for general informational purposes only. The intent of this document is solely to provide general and preliminary information for private use. Do not rely on it as an alternative to legal, financial, taxation, or accountancy advice from an appropriately qualified professional. The content in this guide is provided “as is,” and no representations are made that the content is error-free.
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