A brief overview of the main updates in relation to payroll, employment and related matters, including COLA, Minimum Wage, Leave Entitlement, Tax Rates and Social Security Contributions for 2025, are set out below.
COLA
The Cost of Living Adjustment (increase) is of €5.24 per week (€272.48 per annum) for full-time employees. This is pro-rated in the case of reduced working hours. For part-timers (based on a standard 40-hour week) this equates to €0.13 per hour.
Source: LN 343 of 2024
Minimum wage
As of 1 January 2025, the national minimum weekly wage for whole-time employees is as follows:
- 18 years of age and over - €221.78
- 17 years of age - €215.00
- under 17 years of age - €212.16
The national minimum weekly wage for part-time employees should be calculated on a pro-rata basis at the same hourly rate as that applicable to comparable whole-time employees.
In the case that specific industry Wage Regulation Orders (WRO) apply, sectoral minimum wages would therefore also be applicable depending on the relevant WRO.
Source: LN 342 of 2024
Vacation Leave Entitlement
In 2025, an employee with a 40-hour working week will be entitled to 224 hours of paid vacation leave; that is, the 192 hours basic leave entitlement plus 32 hours in lieu of the four Public Holidays which fall on weekends. This equates to a total of 28 days of paid vacation leave.
The entitlement should be pro-rated in the case of reduced working hours.
Income Tax Rates
The tables below sets out the progressive income tax rates on chargeable income for calendar year 2025.
Single Rates |
|||
Chargeable Income |
|||
| From | To | Rate | Subtract |
| €0 | €12,000 | 0% | €0 |
| €12,001 | €16,000 | 15% | €1,800 |
| €16,001 | €60,000 | 25% | €3,400 |
€60,001 |
and over |
35% |
€9,400 |
Married Rates |
|||
| Chargeable Income | |||
| From | To | Rate | Subtract |
| €0 |
€15,000 |
0% |
€0 |
| €15,001 |
€23,000 |
15% |
€2,250 |
| €23,001 |
€60,000 |
25% |
€4,550 |
| €60,001 |
and over |
35% |
€10,550 |
Parent Rates |
|||
| Chargeable Income | |||
| From | To | Rate | Subtract |
| €0 |
€13,000 |
0% |
€0 |
| €13,001 |
€17,500 | 15% |
€1,950 |
| €17,501 |
€60,000 |
25% |
€3,700 |
| €60,001 |
and over |
35% |
€9,700 |
What should employers look out for in 2025?
- Occupational Pensions
- Revision of the wage regulation order
- The Health and Safety at Work Act
- Minimum Wage and Collective Bargaining Regulations 2024
- Temporary Agency Workers Regulations 2024
Occupational Pensions
In the Budget speech for 2025, it was announced that employers will be required to offer their new employees the opportunity to join an occupational pension plan, however, without mandatory contributions by the employer.
Revision of the wage regulation order
Also, in line with the Budget Speech for 2025, discussions relating to the revision of Wage Regulation Orders will continue, in order to eliminate discrepancies between industry sectors.
The Health and Safety at Work Act
The recent Health and Safety at Work Act repealed the previous Occupational Health and Safety Authority Act. The Act is applicable to all work activities, including those carried out by self-employed persons and aims to broaden the scope of the previous Act, enhancing health and safety standards, and protecting and promoting the well-being of workers.
Source: Chapter 646 of the Laws of Malta
Minimum Wage and Collective Bargaining Regulations 2024
The Minimum Wage and Collective Bargaining Regulations, transposes the relevant provisions of Directive (EU) 2022/2041 of the European Parliament and of the Council of 19 October 2022 on adequate minimum wages in the European Union, and establishes and regulates collective bargaining and facilitating the exercise of the right to collective bargaining on wage-setting.
Source: S.L 452.135
Temporary Agency Workers Regulations 2024
With effect from the 1 January 2025, the updated Temporary Agency Workers Regulations provide that basic working and employment conditions of temporary agency workers employed with a user undertaking shall be at least those that would apply if such workers were recruited directly by that undertaking to occupy the same job. Such conditions include, but are not limited to, rate of remuneration, overtime and working time and rest.
Source: S.L 452.133
Our Payroll, Tax, Legal and Immigration Teams can take care of all your payroll and related requirements, regardless of the size of your organisation. Our payroll experts will help you identify your payroll challenges and design a tailored process that will suit your needs and reach your objectives.
The above is not intended to be exhaustive and other considerations may arise according to the specific circumstances. Get in touch with us should you wish to discuss in more detail.
How can we help?
Through our Payroll, Tax, Legal and Immigration teams we are equipped to handle all your payroll and related needs, regardless of your organisation’s size. We work closely with you to identify payroll challenges and design a process that aligns with your objectives. The above is not intended to be exhaustive and other considerations may arise according to the specific circumstances. Get in touch with us should you wish to discuss in more detail.
Contact us
Social Security Contributions
Social Security Contributions and Maternity Trust Fund Contributions applicable with effect from 1 January 2025.
The table below details the contributions due for Class One (Employed) Persons.
*Note:
Category
Description
A
Persons under 18 years of age earning not more than the amount indicated above.
B
Persons aged 18 and over, earning not more than the amount indicated above.
C
All persons whose basic weekly wage is between the amounts indicated above.
D
All persons whose basic weekly wage is equal to or exceeds the amount indicated above.
E
Students** under 18 years of age.
F
Students** 18 years old and over.
Click here to view source.
The daily rates of benefits of National Insurance regarding Sickness or Injury payable as from 1 January 2025 are:
Daily Rate of Benefit
Single Parent or Married Person with a Spouse not in full-time employment
Sickness Benefit
€ 25.19
€ 16.32
Injury Benefit
€ 37.79
€ 28.44
Click here to view source