Malta : wage flexibility and collective bargaining

Abstract

Variable Pay Systems are usually negotiated at company level in collective bargaining. The Malta Employers’ Association is a fervent promoter of profitrelated schemes, arguing that wage increases should only reflect productivity, the competitive situation and labour market forces. On their part, Maltese unions are adamant on safeguarding the working conditions, especially the wages, of their members. However, in recent years, especially in the manufacturing sector, the General Workers’ Union has adopted a moderate approach in its requests to wage increases in order to protect its members from the threats of redundancy. There are no recent government policy initiatives which directly promote wage flexibility or variable payment systems.