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26 August 2020
Under Maltese law, employers and employees can terminate an employment agreement during the probation period without giving a valid reason. This is subject to certain exceptions brought about by lex specialis introduced to Maltese legislation over the years to protect pregnant employees.
Article 36(1) of the Employment and Industrial Relations Act (EIRA)(1) regulates probation and provides the general rule that, unless otherwise agreed in the employment contract, every new employment has a six-month probation period. The parties may agree to a shorter probation period.
The proviso to Article 36(1) allows for an exception to this rule where the employee holds an executive, administrative, technical or managerial role and concurrently receives wages which are at least double the minimum wage established for that year. When both of these elements are present, unless different terms are contracted into, a one-year probation period applies. The EIRA does not define such technical, executive, administrative or managerial roles, leaving this open to interpretation when analysing each role or job independently.
Article 36(2) specifies that "during the probationary period[,] the employment may be terminated at will by either party without assigning any reason", thus allowing the relationship between the parties to be terminated without the terminating party having to demonstrate good and sufficient cause for termination or abandonment.
The only condition imposed by law is that if the employment has exceeded one month, the terminating party must give prior notice.
The Protection of Maternity (Employment) Regulations were introduced in the early 2000s to establish the minimum requirements to safeguard the employment rights of pregnant employees and those who have recently given birth or are still breastfeeding.(2)
Article 12A of the regulations was introduced through Legal Notice 130/2011 and created a new veil of protection for all pregnant employees. Article 12A(c) introduced an exception to the abovementioned general rule which is specified in Article 36(2) of the EIRA.
Article 12A(c) of the regulations can be divided into five distinct parts, which create the following obligations between the parties to an employment contract:
if the employer fails to give the reason or reasons for the employee's dismissal in writing at the time of the dismissal, this failure shall be considered by the Tribunal as an inference that the dismissal was indeed related to the employee's condition.
In a recent decision of 9 July 2020,(3) the Industrial Tribunal dealt with a situation where a pregnant employee was terminated during her probation period. The employee filed a complaint as per Article 12A(c) of the regulations.
The Industrial Tribunal stated that the reasons given by the employer – namely, that the employee's performance was not up to standard and that she had been negligent with her work – were insufficient to convince the tribunal that the termination was justified. The tribunal concluded that although serious errors had occurred due to the employee's carelessness and lack of responsibility, the reasons given did not constitute good and sufficient cause for termination. The Industrial Tribunal also noted that an allegation raised by the employer that the employee had allowed a conflict of interest to arise were unfounded; rather, the employer had succumbed to pressures imposed by a client.
The Industrial Tribunal reiterated that although the employee had been on probation, the fact that she was pregnant required the employer to follow the obligations imposed by Article 12A(c). As the employer had failed to demonstrate good and sufficient cause, the termination constituted an unfair dismissal.
The Industrial Tribunal awarded the employee €10,000 in compensation.
This decision follows a similar one of the Industrial Tribunal, presided over by the same chair, from 2019. That decision(4) dealt with a situation where a pregnant employee was terminated during her probation period because, according to her employer, she had not reached her sales quota for the specific timeframe. The Industrial Tribunal found that the employer had brought insufficient evidence to show that there had been a justified reason to terminate the employment or that the sales quota was the only reason considered by the employer. The tribunal noted that it was unfair for the employee to have been assessed in comparison with her colleagues on the basis of sales quotas when she had been unable to work through the period on par with her colleagues. In that case, the Industrial Tribunal awarded the employee €10,846 in compensation.
Pregnant employees are entitled to additional protection under Maltese legislation. The burden to demonstrate compliance rests with the employer.
With the present case, the local tribunals have demonstrated that they can deal with these situations swiftly. They are also prepared to award noteworthy compensation even if the employee is still on probation.
In cases of unfair dismissal, the Industrial Tribunal generally considers the following key elements when awarding compensation:
Unfortunately, in both of the above decisions, the Industrial Tribunal did not explain how it liquidated the compensation awarded to both employees. Therefore, it is impossible to evaluate what the tribunal considered when calculating the compensation. It would appear that the Industrial Tribunal applied its discretion arbitrio boni viri.
There seems to be no hard rule for employers to follow when terminating a pregnant employee who is on probation. Although Article 12A(c) allows for this to happen in theory, in practice, it is difficult for employers to prove that the only reason for said termination was a reason other than the pregnancy itself or that the pregnancy was not one of the factors considered when assessing whether the employee should pass probation. The local tribunals regularly remind employers that dismissals are akin to capital punishment for employees and that employers must thus be able to demonstrate that the circumstances taken as a whole warranted the termination. The legislature appears to have set a higher bar with regard to pregnant employees, as employers must not only prove that there was good and sufficient cause but also convince the Industrial Tribunal that there was no other reason for the termination. Failing that, the Industrial Tribunal will presume that the termination was caused by way of the pregnancy – namely, that it was discriminatory and thus unfair.
For further information on this topic please contact Michael Paul Agius at Fenech & Fenech Advocates by telephone (+356 2124 1232) or email (email@example.com). The Fenech & Fenech website can be accessed at www.fenechlaw.com.
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