Analysing ‘Equal Pay for Equal Work’ in Malta

Authors: Ann Bugeja & Clyde Bonnici

General

The saying ‘equal pay for equal work’ has somewhat become a cliché mantra often cited in employment matters. It is a guiding-principle which employers are afraid to infringe, and a protective safeguard which employees are quick to invoke whenever they feel that others are getting paid more than them.

Due to how commonplace this maxim has become, many fail to realise that there is more to it than meets the eye. When unpacked, this legal principle reveals a number of complex questions:

1. What constitutes ‘equal work’?
2. What is covered by ‘equal pay’?

Maltese law leaves these questions unanswered. Indeed, ‘equal pay for equal work’ in Malta is enshrined in Article 27 of the Maltese Employment and Industrial Relations Act (EIRA), which owes its origin to EU Council Directive 75/117/EEC. This article merely states that saving different salary conditions for employees employed in different times, employees in the same class of employment are entitled to the same rate of remuneration for work of equal value.

This provision, therefore, does not address any particular type of discrimination. It only establishes the general rule that employees who perform work of equal value are entitled to the same rate of remuneration: a rule which has been held to be one of public order.

The fact remains, however, that the EIRA does not define ‘work of equal value’ or ‘rate of remuneration’. This task has therefore been left to the Maltese Courts in their attempts to apply Article 27 EIRA in practice.

What constitutes ‘Equal Work’?

Relying on English author Selwyn, Maltese Courts have defined ‘like work’ as work which is the same or broadly similar, such that any differences are not of practical importance. In cases involving equal pay for equal work in Malta, the question to be asked is whether any differences in the work performed are such that it is reasonable to expect to see them reflected in a difference in salary.

The work performed and the class of the employee is to be determined with reference to the job title and job description agreed upon by the parties in the employment contract. The determination as to whether the jobs performed by employees are equivalent to each other is therefore an objective one. This means that this determination is a ‘point of fact’, as opposed to a ‘point of law’, such that after it is determined by the Industrial Tribunal, there would be no appeal on this point to the Court of Appeal.

Differences which the Courts have considered as rendering work to be unequal include the following:

1. Training background of the employees: where the employees concerned have received different professional training, and could therefore be called to perform different duties, the work performed by them cannot be considered as ‘like work’;
2. Availability of the employees: where one employee is expected to be available to his employer all the time and in different places, and the other one is not, means that the value of the work of the two employees is different.

Differences which, according to the Maltese Courts, do not render work to be unequal, include the following:

1. Different grades of the employees: where an employee, despite being in an inferior grade, in practice regularly performs work that belongs to a superior grade, that employee is entitled to be paid the same as those in that superior grade;
2. Different quality of performance: Maltese Courts have held that the quality of the performance should not be considered as changing the value of the work. Thus, in the case of Roberta Spiteri vs ST Microelectronics (Malta) Limited, decided on the 30^th of September 2015, the Court found a breach of Article 27 EIRA where the employer gave a permanent increase in pay to those employees that the employer considered to have performed better than others throughout the year.

What constitutes ‘Equal Pay’?

The law does not define the phrase ‘rate of remuneration’ mentioned in Article 27 EIRA. According to the First Hall of the Civil Court in the judgement decided on the 3^rd of October 2013 in the names Carmelo Dalli et vs Go Plc, this phrase is to be given a broader meaning than ‘equal pay’. The Court in that judgement considered that the legislator did not want to restrict this provision only to equality in salary. The Court referred to the International Labour Organisation’s Equal Remuneration Convention, adopted in 1951, where remuneration is defined as:

“the ordinary, basic or minimum wage or salary and any additional emoluments whatsoever payable directly or indirectly, whether in cash or in kind, by the employer to the worker and arising out of the worker’s employment”.

Thus, in light of these considerations, the Maltese Court in that judgement gave the term ‘remuneration’ such a broad interpretation that it also included therein the payment of a pension.

Limitations in Scope of ‘Equal Pay for Equal Work’ in Malta

If the employee establishes that he is receiving remuneration which is lower than others performing like work, the onus shifts on the employer to prove that the inequality in pay is not discriminatory. To do so, the employer would have to prove that the variation in pay is genuinely due to a material factor. Should such material factor be proved, the employer would not be liable for a violation of Article 27 EIRA.

Article 27 EIRA also envisages that employers are not liable for breaches of ‘equal pay for equal work’ where they agree, with a worker or with a union of workers, different salary scales, annual increments, and other conditions of employment for workers employed at different times, where such salary scales have a maximum that is achieved within a specified period of time.

Somewhat surprisingly, Article 84 of the EIRA also precludes from the protection of Article 27 EIRA employees of government departments. The reason behind this exclusion being that service with the government has always been considered to create a special relationship that is regulated by special and specific legal provisions, and by terms and conditions established with the government from time to time.

Thus, any claim for discrimination in remuneration within a government department cannot be based on Article 27 EIRA. What is noteworthy, however, is that this exemption is limited only to government employees employed with government departments, and does not extend to those employed by public corporations, or government-owned companies.

Unless the disparity in pay is based on sex, equal pay for equal work does not apply for employees of government departments.