Admin headache: Malta Chamber concerned about implementation of new family leave measures

In response to a raft of new family leave measures announced by Government earlier this week, The Malta Chamber – Malta’s largest pressure group representing business interests – cautioned that implementation should not be “administratively cumbersome”, sharing concerns about three key points.

On Tuesday, Government announced changes to paternity leave, parental leave and added a new tier called carers’ leave. Paternity leave sees new fathers’ paid leave allotment on the birth of their child go up from one day to 10 paid in accordance with the individual’s salary.

For parental leave, which was previously four months unpaid, as from 2nd August, this will be two months paid under the National Parental Leave rate, and two months unpaid. Parents will also be allowed to transfer their leave between them and have the first eight years of their child’s life to make use of it.

Government will be paying the cost of the new leave allotments until end 2023, following which such costs will be paid by the employer.

Regarding implementation of the above, The Malta Chamber expressed reservations about the ability of employers to trace how much parental leave has been utilised when considering the eight-year window, it too expressed concerns about the transferability of leave between parents and lastly, that the private sector will have to foot the bill at a time when inflation and staff shortages are seriously impacting the sustainability of many businesses.

In a statement released on Wednesday, The Malta Chamber said:

A centralised system for record keeping

It will be very difficult for employers to trace how much parental leave has actually been utilized by an employee, particularly since people may change job several times over the course of eight years. The Malta Chamber insists on having a centralised system for keeping a record of parental leave utilization, administered by Jobsplus, DIER or the Maternity Leave Fund. This will ensure that there is no abuse of the benefit and ease the administrative burden of implementation on employers. 

Equal burden sharing

The Malta Chamber believes that in the interest of facilitating the administration of parental leave, and more importantly, of ensuring equal burden sharing between parents, irrespective of gender, no portion of parental leave entitlement should be transferable. This recommendation has been made by all employer bodies jointly in writing, but was not taken up by Government. This is a missed opportunity to do something tangible to address both the gender employment gap and the gender pay gap and runs counter to promoting female participation in the labour market.

Private sector funding additional leave

Government will be funding the additional benefits in the first year but will place the onus on employers thereafter, through substantial increases in the Maternity Leave Fund contributions. This will have a negative impact on businesses, many of them are still trying to recuperate from the pandemic and struggling with several challenges such as labour and skills shortages and the resultant wage inflation, high costs of raw materials and transportation, and uncertainty surrounding the sustainability of the current energy prices. The current situation calls for greater sensitivity and a reassessment of the situation after the first year of implementation.