Malta and Its Human Resources - 2019

Malta and its
Human Resources
Management and Development Perspectives
Edited by
Godfrey Baldacchino,
Vincent Cassar and Joseph G. Azzopardi
2019
Published by
Malta University Press
Ġużè Cassar Pullicino Building
University of Malta
Msida, Malta
mup@um.edu.mt
+356 2340 2566
www.um.edu.mt/mup
Publishing Rights – Malta University Press

Copyright © Godfrey Baldacchino, Vincent Cassar & Joseph G. Azzopardi, 2019
All rights reserved. No part of this publication may be

reproduced, stored in a retrieval system or transmitted, in any
form or by any means, electronic, mechanical, photocopying,
recording, or otherwise, without the prior permission of the University of Malta.
First published 2019
Produced by Midsea Books Ltd

Printed by Gutenberg Press
Cataloguing in Publication
MALTA and its human resources: management and development perspectives / edited by
Godfrey Baldacchino, Vincent Cassar and Joseph G. Azzopardi. – Msida : Malta University
Press, 2019.
p. ; cm.
Includes bibliographical references and index
ISBN 978-99909-45-98-0
1. Personnel management – Malta. 2. Personnel departments – Employees. I.
Baldacchino, Godfrey, 1960- . II. Cassar, Vincent,1972- . III. Azzopardi, Joseph
G., 1959-
LOC: HF5549.2.M3M3 DDC: 658.3

Melitensia: MZT,QM
Contents
Notes on Contributors............................................................Page vii

EDITORIAL: The Changing Local Labour Market and
the Changing HR Professional
– Vincent Cassar, Godfrey Baldacchino
and Joseph G. Azzopardi.............................................Page xvii
Part I: THE HUMAN RESOURCE MANAGEMENT

& DEVELOPMENT FUNCTION.......................................Page 1
1. Metrics, Diagnostics and Indicators:
HR Analytics in HRM
– Frank H. Bezzina & David Baldacchino..................Page 3
2. Selection, Recruitment and Induction
– Malcolm Pace Debono & Petra Sant.........................Page 23
3. Performance Management: Processes and Practices
– Caroline Buhagiar Klass..............................................Page 53
4. Motivation, Control and Commitment
– Gottfried Catania..........................................................Page 75
iv Malta and its Human Resources
5. Wellbeing, Quality of Life and Rewards

– Luke Anthony Fiorini....................................................Page 95
6. Equality, Diversity and Inclusion
– Anna Borg.......................................................................Page 119
7. Education, Training and Development
– Joseph G. Azzopardi......................................................Page 141
8. Industrial Relations and Collective Bargaining:
Working with Trade Unions
– Manwel Debono ..........................................................Page 165
9. Creativity, Entrepreneurship and Innovation
– Leonie Baldacchino.......................................................Page 187
Part II: HR ISSUES IN SPECIFIC

ECONOMIC SECTORS.................................................Page 217
10. Agriculture, Aquaculture and Fisheries:
Harvesting Resources from Soil and Sea
– Everaldo Attard.............................................................Page 219
11. Construction: The Engine of Development?
– Rita Sant..........................................................................Page 245
12. Manufacturing: Factory Work and Automation
– David Parnis...................................................................Page 269
13. Tourism and Hospitality: Come Visit our Islands
– Leslie Vella......................................................................Page 287
14. Electronic Gaming: Platforms of Playfulness
– Dominic Cortis & Elaine Falzon................................Page 317
15. Small and Medium Scale Enterprises:
Loyalty and Family
– Nathaniel P. Massa.......................................................Page 337
Contents v
16. Public Service and Public Sector (Part 1):

Working for the State
– Joyce Cassar & Myrna Azzopardi..............................Page 363
17. Public Service and Public Sector (Part 2):
Pay Negotiation
– Mario A. Grixti..............................................................Page 391
18. Financial Services: Banking on Success
– Gertrude Spiteri.............................................................Page 411
19. Health Care: Resourcing Clinics and Hospitals
– Miriam Dalmas.............................................................Page 433
20. Institutions of Higher Learning:
From Diplomas to Doctorates
– Colin Borg.......................................................................Page 457
21. Advisory and Consultancy Services
– Maria Bartolo Zahra & Joseph F. X. Zahra.............Page 481
Subject and Author Index.......................................................Page 503

Notes on Contributors
Everaldo Attard B.Pharm.(Hons.), MSc (Melit.), PhD (Melit.) is a pharmacist

by profession, an Associate Professor at the University of Malta and an Adjunct
Associate Professor in Integrated Science and Technology at James Madison
University, USA. He is currently the coordinator of the Division of Rural
Sciences and Food Systems, Institute of Earth Systems, University of Malta.
He led several National and Interregional projects related to the agricultural
workforce and is currently assisting various stakeholders within the
agricultural sector to improve the current workforce by continued educational
programmes, workshops and valorisation of agricultural products through
research and education.
Joseph G. Azzopardi BA (Hons.), MSc (Manch.), PhD (Manch.) is Senior

Lecturer at the Department of Management, Faculty of Economics, Management
and Accountancy, University of Malta. He served as Head of the Department
of Management and as Chair of the Institute of Tourism, Travel and Culture
and is visiting lecturer at the University of Le Havre, France. His research
interests include human resource management and development, leadership,
action learning, action research, knowledge management, intellectual capital,
psychological capital and organisation and community development. His work
has appeared in such peer-reviewed journals as The International Journal of
viii Malta and its Human Resources
Human Resource Management, Public Money & Management, International

Journal of Organisation Analysis, Journal of Global Responsibility, Island
Studies Journal and The International Journal for Quality in Health Care.
Myrna Azzopardi LLD (Melit.), LLM (Int & Eur Law) (Sheffield) is a Senior
Manager at the People & Standards Division within the Office of the Prime
Minister, Government of Malta. She focuses on legal and research matters
relating to people management, conditions of service, industrial relations and
discipline, among others. She has previously worked at various Ministries and
public sector entities in legal, research and EU-related roles. She has previously
served as one of the editors of Id-Dritt, a local legal journal. She is currently
reading for an MBA (Public Management) at the University of Malta.
David Baldacchino B.Pharm (Hons.), MSc. (Agr. Vet. Pharm.), MBA (Exec.),
PhD (Melit.) is a Senior Principal Pharmacist and the Responsible Person
for the Central Procurement and Supplies Unit: the medicines wholesale
dealing arm of the Ministry of Health, Government of Malta. He has over
two decades of experience in the Maltese Public Sector, mostly in the
pharmaceutical field, in the areas of quality assurance and tender evaluation.
He is also a part-time lecturer at the Department of Management, Faculty of
Economics, Management and Accountancy, University of Malta. His research
interests focus on knowledge management, human resource management and
development, organisational studies, evidence-based management and HR
analytics.
Godfrey Baldacchino BA (Gen.), PGCE (Melit.), MA (The Hague), PhD

(Warwick) is Professor of Sociology at the University of Malta, with a
professional interest in human resource management, labour relations,
organisational behaviour and the sociology of work. He served as Research
Assistant, Research Officer and then Director of the Centre for Labour Studies
(previously known as the Workers’ Participation Development Centre) at the
University of Malta from 1981 to 2003; and a member of the Board of the
Foundation for Human Resources Development (FHRD) from 1999 to 2003.
He co-edited (with Antoinette Caruana and Mario A. Grixti) the 2003 volume
Managing People in Malta (Agenda Publishers).
Notes on Contributors ix
Leonie Baldacchino B.Psy. (Hons), MA (Creativity & Innovation), PhD

(Warwick) is Director and Senior Lecturer at The Edward de Bono Institute
for the Design and Development of Thinking at the University of Malta,
where she has been lecturing on entrepreneurship, creativity and innovation
since 2008. Her research interests include the psychology of creativity and
entrepreneurship; social and sustainable entrepreneurship and innovation;
and entrepreneurship education. She has published locally and internationally,
including in the International Journal of Management Reviews, International
Journal of Entrepreneurial Behavior and Research, and in edited books by
Routledge and Edward Elgar.
Maria Bartolo Zahra MSc (HRM) (Leicester), PG Dip (Marketing) (CIM),

Cert. Recruitment Practice, Cert. Reward Management (CIPD), PG Cert
(Higher Education), is an HR professional with experience in HR and
business advisory. She has most notably led and participated in a range of
small and large projects focused on remuneration and reward, job evaluation,
organisation design, performance management systems, employee
engagement and retention, recruitment and training and development. She is
founding partner and Managing Director of SurgeAdvisory, a corporate and
HR strategy consultancy. She was National President of JCI Malta in 2009 and
is now a Senator. She is a visiting lecturer in leadership and HR management
for both undergraduate and postgraduate students at Middlesex University
(Malta).
Frank H. Bezzina B.Ed. (Hons.) (Melit.), Dip.Ed.Mangt. (JEB), MSc (SHU), PhD
(Melit.) is Dean of the Faculty of Economics, Management and Accountancy,
University of Malta. He holds visiting professor positions at the University
of Zagreb (Croatia), Wroclaw University of Economics (Poland), Haxhi Zeka
University (Kosovo) and LM Thapar School of Management (India). His
research mainly focuses on investigating phenomena in the organisational
sciences. His work has appeared in several peer-reviewed journals, including
the European Management Journal, International Journal of Human Resource
Management and Computational Economics. Beyond his academic role, he has
been engaged in various consultancy assignments and projects. He is currently
a director of the Central Bank of Malta.
x Malta and its Human Resources
Anna Borg Dip. Soc. St. (Melit.), MSc (Manchester Met.), PhD (Middlesex) is
the Director of the Centre for Labour Studies (CLS) at the University of Malta.
She coordinates the honours degree course in Work and HR and the diploma
course in Gender, Work and Society. She is also involved as an expert in the
European Social Policy Network (ESPN). She led the Gender Equality Unit at
the Employment and Training Corporation as well as the EU Education and
Training Agency, Leonardo Da Vinci in Malta. She remains active with NGOs
that promote gender equality and is the founder of the Association for Equality
(A4E).
Colin Borg B.Com. (Hons.) (Melit.), MA (Public Policy) (Melit.) is Senior Executive
in the Office of the Registrar at the University of Malta, responsible for the Students
Information Management System (SIMS), the Doctoral School and assessment
results. He has been involved in the setting up of the University›s Doctoral
School and the Centre for the Liberal Arts and Sciences. In addition to his work at
the UM, Mr Borg worked at the Office of the Prime Minister, between 2005 and
2007, gaining experience in bilateral programmes, EU funding, project management
and organisational techniques. Mr Borg also lectures in the University of Malta’s
Department of Public Policy where he is currently a PhD candidate, studying the
governance and management of higher education in Malta. Mr Borg has published
papers in peer-reviewed journals in the areas of governance, public management,
local governance and higher education.
Caroline Buhagiar Klass Dip. (Adult Education, Training & Development)

(Melit.), MSc (Work Psychology) (Leicester) is an HR Professional with
experience ranging from business studies to human capital strategies. After
20 years in manufacturing, she moved to finance where she spent 15 years
(including six in Singapore) driving regional and global HR functions. She has
managed various HR transformation projects involving organizational design,
mergers and acquisitions across different countries. She has a passion for
people development and building strong leadership pipelines to prepare the
organization for the future.
Joyce Cassar PG Dip (Sheffield Hallam), MA, PhD (Melit.) is the Permanent
Secretary for People & Standards in the Office of the Prime Minister,
Government of Malta. Her multidisciplinary doctoral research investigated free
Notes on Contributors xi
will in individuals suffering from mental disorder, with a focus on those suffering
from dependence syndrome. Her managerial experience in HR, Training
& Development, Quality and Industrial Relations started in manufacturing
industry from where she moved to the tourism sector where she held top
managerial positions. From 2007 to 2010, she headed the Community Services
division and then opened the first residential female programme for drug
users at Caritas Malta.
Vincent Cassar CPsychol (UK), CSci (UK), PhD (Lond) is Deputy Dean of the
Faculty of Economics, Management and Accountancy, University of Malta, and
a Visiting Scholar at Birkbeck College (University of London), the University
of Zagreb (Croatia) and Wroclaw University of Economics (Poland). Professor
Cassar serves as a Senior Technical Consultant at KPMG (Malta) People &
Change Advisory. His research includes the psychological contract, occupational
health and stress, and evidence-based management in specific decision-making
situations and HR-data driven processes. His work has appeared in such peer-
reviewed journals as Work & Stress, European Management Journal, Journal of
Vocational Behaviour, and the International Journal of HRM.
Gottfried Catania BA (Hons.) (Melit.), MSc, PhD (Loughborough) is an

organisational psychologist and resident academic at the University of
Malta, and currently the Deputy Head of the Psychology Department. He
has also designed, delivered and evaluated training programmes in various
organisations, and is involved in consultancy in workplace settings. His research
interests include workplace motivation, ethical behaviour at work, and the
impact of technology on quality of life. He has published his research in various
academic journals and edited books, and presented in local and international
conferences. He and was awarded best PhD paper at the 14th European
Conference for Research Methodology for Business and Management Studies.
Dominic Cortis B.Ed. (Hons.) (Melit.), MSc (Leicester), AIA (IFoA), is an

actuary and lecturer with Faculty of Economics, Management and Accountancy
at the University of Malta. Dr Cortis serves as a non-executive director of a
non-life insurer and an actuarial consultant. Dominic has published academic
papers focusing on the challenges faced in the insurance and sports betting
industries.
xii Malta and its Human Resources
Miriam Dalmas MD, MSc, MBA, PhD (Melit.) is a medical doctor specialising
in Public Health Medicine. Her doctoral research focussed on the organisational
dynamics in a major hospital in Malta that foster or inhibit organisational
learning. Since 2009, she has worked as a medical consultant in the Office of
the Chief Medical Officer, mainly in the domains of policy development and
international public health. She is the national focal point on cancer policy
and is the Maltese member on the Board of Member States for the European
Reference Networks. She is a former Director for Policy Development,
International and European Union Affairs within the Ministry for Health.
Manwel Debono B.Psy. (Hons) (Melit.), MSc (Hull), AFBPS, C.Psychol (UK),
PhD (Melit.) is a Chartered Occupational Psychologist and a senior lecturer
at the University of Malta. He served as Director of the Centre for Labour
Studies for five years. Dr Debono has been involved in numerous local and
European research projects about industrial relations and working conditions.
He has contributed to the European Foundation for the Improvement of Living
and Working Conditions since 2003, and to the European Employment Policy
Observatory for over a decade. Dr Debono’s research interests include industrial
relations, working conditions, human resources and career development.
Luke A. Fiorini BSc (Hons.), PG Dip Health Science (Melit.), MSc Ergonomics
(Derby), PhD (Nottingham) lectures at the Centre for Labour Studies, University
of Malta, where he developed and coordinates the Bachelor in Occupational
Health and Safety (Hons). He also lectures in the Bachelor of Work and Human
Resources (Hons). He has conducted research for several European institutions
including the European Commission, Eurofound and the European Trade
Union Institute (ETUI). His research interests include worker absenteeism,
presenteeism, occupational health, and work performance, and he has assisted
several public and private organisations to foster better occupational health,
wellbeing and work performance.
Mario A. Grixti DPA (Melit.), MSc (HRM) (Manchester) is a career civil

servant who has occupied posts mainly dealing with applied HR and Industrial
Relations. He has served under four different legislatures in a senior position
representing Government in Industrial Relations negotiations with the various
unions. Mr. Grixti also has lecturing experience at the University of Malta and
Notes on Contributors xiii
the Institute for Public Services. In 2003, he co-edited Managing People in

Malta, the first book on HR issues published in Malta.
Nathaniel P. Massa B.Com. (Melit.), P. G. Dip. Mangt., MBA (Henley), PhD

(Glasgow) is Senior Lecturer in the Department of Management, Faculty of
Economics, Management and Accountancy, University of Malta. He is also a
visiting academic at the Institute of Technology, Université du Havre (France),
and associated with the International Business and Enterprise community at
the Adam Smith Business School, University of Glasgow. His interests include
business strategy and international entrepreneurship, dynamic capability and
organisational behaviour, knowledge and intellectual capital, as well as SME
and family business research. Dr Massa is also involved in executive training
programmes for managers and practitioners in industry.
Malcolm Pace Debono BSc, MSc (Melit.), is a Director within the advisory
practice at KPMG Malta and Head of Management Consulting for KPMG
Island Group. Over the last 25 years, Malcolm has advised regional and
international small and medium-sized private enterprises and multi-nationals
in enabling business optimisation and enhancing organisational performance
through strategic workforce planning, organisational development, job grading,
strategic talent management, leadership development, employee engagement,
workplace culture, customer experience transformation, leadership strategic
visioning, process improvement and change management. He has also
worked on several public sector research projects in education, employment,
employability and occupational analysis, including the production of Malta’s
first Occupational Handbook.
David Parnis BA (Hons.), MA (Social Studies) (Melit.) started working in

the field of addiction and in the area of personal and social development.
He joined the Human Resources Department at Methode Electronics
(Malta), where he is now a Senior Manager. His research interests include
social exclusion, subcultures and inter-generational trauma. David has also
pursued professional studies in psychotherapy. He is a visiting lecturer at
the University of Malta. His spare time is devoted to reading, writing and
practising sports.
xiv Malta and its Human Resources
Petra Sant B.Psych. (Hons.) (Melit.), MSc (Occupational Psychology),

(Birkbeck College, London) is Head of Human Resources at Elmo Insurance.
She has extensive experience in talent development and retention, employee
engagement, and qualitative and quantitative data analysis. She has supported
organisations in various industries in translating their business objectives
into people strategies. Petra has worked with senior management teams
and HR Professionals to: provide strategic talent management consultancy;
translate business strategies into a mission, vision and set of values; review and
assess existing HR strategies, salaries and compensation structures; develop
performance management systems; and deliver training. Her academic
research includes talent management, employee engagement, interpersonal
relationships and workplace bullying in Malta.
Rita Sant BE&A (Hons.) (Melit.), MSc Project Management (Melit.) is an

architect and civil engineer and has worked as a senior Project Manager within
the Construction Industry on both private and public major projects for the
past twenty six years. She currently works as a Senior Executive at the Estates
Facilities and Capital Development Directorate at the University of Malta
on major projects. She has an interest in the professional development of
construction workers, assisting these to achieve their best site performance.
Gertrude Spiteri Dip. Social Work (Melit.), BSc Psychology (Open University),
MSc Training & HRM (Leicester) is an HR practitioner with a background in
Social Work and Psychology. She has a professional interest in understanding
people at work and creating healthy work environments. She is an advocate for
putting employee well-being at the heart of HR Strategies. She has served as
Chairperson of the Welfare Committee at Air Malta plc and as Chief Officer
Human Resources at a government agency. She has also delivered bespoke
training in various companies. She is presently practising human resources in
the financial sector. She is also researching decision making under stress for
her doctoral studies.
Leslie Vella BA (Hons.) Business Management (Melit.) has a 36-year career

with the Malta Tourism Authority, having occupied various management
posts and is currently Deputy CEO/Chief Officer Strategic Development
specialising in policy, strategy, tourism research and planning. He was Chair of
Notes on Contributors xv
the European Travel Commission’s Market Intelligence Group (1988-2014) and

ETC’s Vice-President during 2016-2017. He is Malta’s Focal Point to the UN’s
World Tourism Organisation. In 1999, he co-authored “The Economic Impact
of Tourism in Malta” and was the main drafter of Malta’s National Tourism
Policy 2015-2020. He is currently responsible for executing Malta’s airline
route development strategy.
Joseph F. X. Zahra BA, MA (Econ.) (Melit.) is an economist and a director

of SurgeAdvisory, a corporate and HR strategy consultancy. He is a founding
partner and former Managing Director (1983-2016) of MISCO, a pioneering
independent management consultancy introducing HR professional services in
Malta in the early eighties. He held a number of public appointments including
that of Chairman of Bank of Valletta plc (1998-2004) and the National Euro
Changeover Committee (2005-2008). He is a director of private and publicly
listed companies. He was visiting lecturer in micro and managerial economics
at the University of Malta and the University of Messina, Italy.
Editorial
The Changing Local Labour

Market and the Changing
HR Professional
Vincent Cassar, Godfrey Baldacchino
and Joseph G. Azzopardi
It is never too easy to write up (yet) another book on the topic

of Human Resource Management (HRM) and expect to make
a significant readership impact, especially when there is so
much literature around. A cursory look at Google Scholar lists
around six million record hits on the topic. The Web of Science
lists approximately 24,000 sources, excluding conference
proceedings, over a period of 24 years. That is indeed a massive
literature database. Also varied are the topics discussed and
linked to HRM, which makes it even more cumbersome to
write about; but also renders it such a widely varied and exciting
subject. Armstrong and Taylor (2014), for example, list a number
of important topics that are organised in eight sections in their
landmark book; these represent perspectives emergent from the
disciplines of psychology, geopolitics, macro-economics, ethics,
education, industrial relations, strategy and policy. This makes
it difficult for anyone to claim a tight grip or monopoly on the
topic and confirms that HRM is multi-disciplinary in nature.
The emergence of HRM as a concept and as distinct from
traditional Personnel Management is attributed to two seminal
books published in the United States in the early 1980s that
xviii Malta and its Human Resources
eventually came to be referred to as the Michigan model

(Fombrun et al., 1984) and the Harvard model (Beer et al., 1985).
Kaufman (2015) presents an excellent analysis of the development
and evolution of HRM since the publication of these texts
using two other recently published books, one representing the
scholar-practitioner stream (Cascio & Boudreau, 2012) and the
other representing the analytic-science stream (Paawe, Guest &
Wright, 2013) of HRM, as benchmarks. He observes a ‘shift from
management practice to management science’ as the general
trend that characterised the development of HRM over the past
30 years. He concludes that:
The most solid and value-added part of HRM past and present
comes from research in which academics advance practitioner-
useful knowledge and tools through a blend of science-based
theory and empirical methods and experiential insight gained
from substantial involvement with the operational realities and
problems of real-life business organisations (Kaufman, 2015, p.
404).
HRM is a topic that is very much evolving as the world of
work rapidly changes around us. Bhalla, Dyrchs, and Strack
(2017) list a number of ‘demand’ forces (automation, big data
and advanced analytics, access to information and ideas,
simplicity in complexity, agility and innovation and customer
strategies) against a set of ‘supply’ forces (a new demographic
mix, diversity and inclusion, skill imbalances, individualism and
entrepreneurship, shifting geopolitical and economic power and
well-being and purpose) that new organisations need to adapt
to. Indeed, a great number of authors have treated this subject of
change in the world of work since the 1990s. Moreover, whereas
three to four decades ago, the emphasis was on commitment
at work, and career stages centred around one’s firm, the
contemporary emphasis is on alignment, flexibility, authentic
skills sets and strategic alliances, thus requiring a new mind-set
and outlook of ‘work organisation’ and employment in general.
Consequently, the organisation of work and the broader context
in which work takes place have tremendous implications on
Editorial xix
how management, not least HRM, thinks about, and assesses

individual, managerial and organisational outcomes (Ashford,
George & Batt, 2007; Cappelli & Keller, 2013; Grant & Parker,
2009; Humphrey, Nahrgang, & Morgeson, 2007). Within this
context of the reconceptualisation of ‘work’, HRM is a central
element that drives organisations towards their general objectives
and performance targets (Ostroff & Bowen, 2016).
In addition, HRM does not reside in a vacuum. While specific
practices, ideas and toolkits can be imported or borrowed from
other organisations in different contexts, there is nothing like
plug-and-play in HRM and one often needs to evaluate the role
and purpose of HRM practice from a specific social, economic
and political context: in this case, Malta. ‘HRM system strength’
refers to how an HRM system is designed and administered
effectively by defining strong practising components that
collectively create a strong sense of shared meaning about the
content that might ultimately be used to impact firm performance
(Bowen & Ostroff, 2004). To this end, HRM practices serve as a
means of communication between employers and employees that
ultimately qualifies the nature of the employment relationship.
This way of thinking construes HRM as a system that affects
performance as part of a broader strategic process, shaped by
wider social, political and economic contextual challenges and
realities. ‘HRM system strength’ is not universal but rather subject
to national cultural differences. National culture dimensions
– such as power distance, uncertainty avoidance, performance
orientation and in-group collectivism identified by Hofstede
(1983) – should be considered as examples of contingency
factors when theorising the impact of respective HRM practices
and approaches on firm performance within specific contexts
(Farndale & Sanders, 2017).
Thus, tuning one’s lens to particular contexts in the area of
HRM is warranted and provides a different perspective to HRM
from the more universal approach which textbooks tend to
adopt (e.g. Armstrong & Taylor, 2014). Moreover, publications in
the field of HRM in Malta are grossly limited, in spite of the fact
xx Malta and its Human Resources
that HRM has increased in popularity over recent years, as an

academic subject as well as in its importance to organisational
life and as a career choice. This lacuna thus justifies the potential
impact of this publication. Management practice always unfolds
within a specific, wider and larger geopolitical reality. In Malta’s
case, the country is a full member of the European Union since
2004 and its economic landscape cannot be easily described
as purely ‘domestic’ in spite of the fact that so-called local
businesses are still rooted in the Maltese market and relatively
few entrepreneurs have sought international avenues. On the
other hand, Malta has a diverse and growing economy and is
no longer restricted to traditional manufacturing, tourism or the
public service. Thus, it is useful to contextualise this book within
the current realities of Malta’s economy.
The Maltese Economy: Demand and Supply Dynamics
The Maltese economy faces the rest of the 21st century in

much better shape than it faced the prospects of political
independence back in 1964. After centuries as a fortress
economy, the switch to competitiveness as an export-oriented
economy was painful but necessary. Labour intensive ‘textile
and garment’ manufacturing and tourism were meant to
lead the way. A wave of state-owned enterprises was set
up in the 1970s, followed by a push towards liberalisation
in the late 1980s. A massive investment in post-secondary
education saw the establishment of the Institute of Tourism
Studies, a huge expansion at the University of Malta and the
launch of the Malta College of Arts Science and Technology
(MCAST) in 2000. The labour intensive industries are now
gone; and tourism has morphed away from the ‘sun, sea and
sand’ summer packages intended for British visitors. Today,
no economic sector represents more than 15% of gross value
added, suggesting that the economy is diversified and therefore
fairly resilient to external shocks. High-end manufacturing has
Editorial xxi
maintained a presence on the island; tourism has matured into

many segments, and new economic activities have sought out
Malta’s attractive location, its political stability and its well-
trained and disposed workforce, conversant in English: aircraft
maintenance, currency printing, generic pharmaceuticals,
aquaculture, financial services, e-gaming, and distributive
ledger technologies. While the bulk of these involve foreign
direct investment, Maltese entrepreneurs have proliferated
in specific service niches – such as scuba diving and ‘teaching
English as a foreign language’ tourism, and artisanal food
and wine production – while Maltese firms like Farsons and
Corinthia have sought out and secured major overseas markets.
Thus, we now live in a more knowledge-driven, service-
oriented and capital intensive sector-dominated market.
Many local businesses are networked internationally, and this
inevitably influences how people management systems are
designed and operationalised within the Maltese cultural and
work ethic scenario. At the same time, local challenges remain:
high rates of early school leaving still present obstacles to
ensuring equal opportunities; the share of employers reporting
labour shortages has increased substantially; reliance on foreign
labour to address labour and skills shortages is increasing; and
the tertiary educational attainment rate is rising steadily but
persists stubbornly below the EU average (Country Report
Malta, 2018). Tried-and-tested HRM practices can help to
address these challenges; but the idiosyncratic realities of a place
like Malta require special attention to steer practices and adapt
them in the most efficient and effective way possible.
This is why the timing of this book is ideal. It represents a
major overhaul over the only other publication that has covered
similar ground (Baldacchino, Caruana & Grixti, 2003) and is
quite unrecognisable from the review of the development of
‘personnel management’ offered by Zammit (1986). Thanks to
27 contributors, experts in their respective field, it highlights
the major and recent changes that have occurred in Maltese
organisations in terms of how they construe HRM in Malta
xxii Malta and its Human Resources
within a European and global backdrop and the challenges that

lie ahead, while providing some possible solutions.
And there have been significant changes! One fundamental
alteration has been in employment legislation. The Employment
and Industrial Relations Act (EIRA) (2002) substituted the previous
Conditions of Employment (Regulation) Act and the Industrial
Relations Act. EIRA recognises that industrial relations go beyond
the mere contractual agreements between employers and employees
and affirms that the quality of employment relations is a sub-set of
the wider quality of work life. Indeed, ‘industrial relations’ is not,
strictly speaking, distinct from ‘employment relations’ but merely
captures a narrow range of possible behavioural observations that
occur in the employment relationship. In this respect, scholars
like Blyton and Turnbull (1998) have attempted to qualify a
theory of employee relations which, although not neglecting the
conflicting and resisting nature of any typical labour relation, also
emphasises the notion of economic and non-economic exchange,
the role of power and authority in the relationship, the issue of
an interdependent relationship between the parties, and, most
important of all, the process of cooperation and accommodation
in establishing and maintaining the relationship. In addition, this
‘relationship’ qualifies a set of mutually beneficial outcomes that
satisfy both the profit motive of employers and the demand for
quality of life by employees; a topic that is critical to the HR function
(Guest & Hoque, 1994). This is, in fact, the current state-of-affairs in
most Maltese work organisations.
Three key developments
A number of unprecedented developments have occurred in

Malta over the almost two decades since Baldacchino et al. (2003).
Here, we briefly refer to three significant and incontrovertible
phenomena that have changed the HRM landscape in Malta. We
refer to these examples to help us drive our point home, and not
because they are uniquely more important than others.
Editorial xxiii
The first is the increase in non-Maltese nationals (or foreign

workers). Official statistics indicated an almost tenfold increase
– from around 2,500 to 22,000 foreign workers – between 2000
and 2014 (Central Bank of Malta, 2016). The largest visible
increase was from EU-nationals which represented over 70
per cent of the total foreign workforce in Malta. More recent
indications and statistics suggest that this figure has rocketed
to 43,000 workers (double the number reported for 2014), and
this over just a four- year period (Times of Malta, 2018), while
the share of full-time foreign workers has reached 20% of total
gainful employment (Ministry of Finance, 2018). The types of
work absorbing these numbers are varied and cut across all
sectors; they include the arts, entertainment and recreation
sectors, hospitality, financial services and construction; and
the often discussed visible challenges that this human influx
has brought about typically deal with infrastructure and space
issues. But there are more subtle challenges and opportunities
associated with this increase in the non-Maltese workforce
which are of direct relevance to HRM.
Standard theory posits that immigrants increase the supply
of labour and lower wage growth, and since in the short run the
capital stock cannot adjust, there is a fall in labour productivity.
In the long run, however, productivity should increase. These
workers could enhance the human capital stock by bringing with
them new skills and knowledge which could be shared with the
local workforce. They also may increase the incentive for local
workers to acquire new skills, in order to compete with them. The
availability of skilled foreign workers enables the development
of new industries, which otherwise would be bottlenecked by
skills shortages (Central Bank of Malta, 2016, p. 42). At the same
time, simply adding workers to an existing workforce and work
process may not provide the competitive edge that comes with an
investment in new technology, software and/or robotisation.
This trend appears likely to continue for the conceivable
future. Malta’s economic momentum is expected to support
further employment creation, on the back of record-low
xxiv Malta and its Human Resources
unemployment and increasing labour supply resulting from the

inflows of foreign workers and the rising participation of women
in the labour market. According to the Labour Force Survey,
there has been an increase of an additional 5.8% women in the
labour market between October 2017 and June 2018. This has
meant that female gainful employment is creeping up to almost
half of total employment, and therefore parity with men. When
considering that the females constituted a mere 28.4% of labour
supply in 2003, this is a significant achievement. Efforts continue
to be made at policy level to increase this percentage even further.
The second development is the change and increased demand
in new skill sets required to sustain and maintain the economic
activities of organisations in Malta. During the first quarter of
2018, approximately 53% of the Maltese working population was
defined as having a low level of educational attainment, while
only 20% were considered to possess a high level of education
(National Statistics Office, 2018). A 2017 report indicated skill
mismatches in certain economic sectors and within specific
occupational groups. It suggested a number of recommendations
to reduce this gap and avoid shocks in the skill demand-supply
relationship; these include stakeholder involvements, more
innovative education and training programmes, and enhanced
opportunities for knowledge transfer (Jobs Plus & NCFHE,
2017).
The third phenomenon is the relative increase in job mobility
across all organisational hierarchies and sectors, especially
among the more educated. Not much has been written about this
state of affairs; but observant and anecdotal evidence suggests
that workers in Malta are now less likely to stick with the same
employer: motives for doing so are often financial, rather than
career-driven. As the Maltese labour force approaches the
250,000 mark, we have record numbers of people switching and
changing jobs at any point in time. Employers and managers can
be caught in a quandary: offering opportunities for professional
development to their employees is one of the attractions of
their working conditions and proofs the firm from competitive
Editorial xxv
pressures; but it can also make it likely for their (now better
skilled and qualified) employees to be lured to join other firms,
or switch to self-employment.
These three instances (and many others which this book
critically evaluates) are testimony to the serious changes
that the Maltese labour market faces and will continue to
experience in the short-to-medium term. The challenges that
such transformations throw up will require strategic planning,
foresight and maintenance in order to sustain the levels of
economic growth achieved so far.
This book
Much has changed since the Maltese were described, in a 1524

report for the Knights of St John, as a poor community liable
to attack from corsairs and pirates: 12,000 souls in Malta
eked a living from a poor soil (not suitable for growing grain)
cultivating figs, melons and cotton and selling honey; while
5,000 folk in Gozo had some copses of oranges and olives. Much
has also changed since Malta acceded to the European Union in
2004 and transformed itself into a “labour importing economy”
(Baldacchino, 2017). Additionally, HRM has moved closer to
the heart of organisational management and strategy. The onset
of web-supported HR analytics and the strategic role of HR are
nurturing a new class of HR professionals and practitioners
who are more savvy with handling data and have a deeper
understanding of strategy.
We offer Malta and its Human Resources as a definitive,
state-of-the-art, carefully edited collection of chapters that
reviews the fast changing world of work, employment and
self-employment in the Maltese Islands. It sources materials
from academics as well as practitioners working in the field
and covers the subject matter via a distribution of its content
into two complementary sections: Part 1 –The Human
Resource Management and Development Function – discusses
xxvi Malta and its Human Resources
the evolution of HRM practices within a Maltese context-

based scenario. It looks at aspects like education and training,
performance management, recruitment and selection, industrial
relations, career development, motivation, creativity, equality,
HR analytics and well-being issues as construed and evaluated
within a Maltese work context. Part 2 – Sectors – then provides
a critical review of the major and most salient economic sectors
of the contemporary Maltese economy. It teases out the different
HRM priorities, challenges and opportunities as they vary
between different employment sectors, ranging from agriculture
and manufacturing to public service, healthcare, tourism,
financial services and I-Gaming, amongst others. We provide
more details about these two sections below.
Part One: The Human Resource Management and

Development Function
The first part of this book is mainly conceptual: it brings

together nine chapters contributed by expert academics and
seasoned practitioners. The reader is taken through a journey
that explores the development of the main domains of the HR
function in organisations, with specific application and reference
to the Maltese context.
The first chapter, by Frank Bezzina and David Baldacchino,
challenges HR managers to start embracing an evidence-based
approach to the management and development of people in
organisations. They argue that managers today need to bring
to their Board factual and objective knowledge backed by data
and analysed scientifically by using HR analytics. They find little
evidence that HR managers in Malta are using such techniques and
therefore recommend that more research be carried out to explore
the current skills and capabilities of HR professionals and to devise
ways of enabling them to perform HR analytics effectively.
The chapter by Malcolm Pace Debono and Petra Sant on
selection, recruitment and induction introduces the reader to
Editorial xxvii
the actual context of the HR function in Malta. They present

this setting in terms of business demography, an overview of
the Maltese labour market and the nature of the jobs and skills
that they envisage for the future. They treat recruitment in the
context of the changing realities of the Maltese labour market
and the growing need to learn how to acquire and retain talent in
organisations. Recruitment is no longer just about filling vacancies
but also about proactively assuring that organisations have the
right people, with the right skills, in the right place, at the right
time, all the time. In line with the previous chapter, they therefore
recommend Maltese organisations and employers to approach
the use of application forms, interviews, references, assessment
centres and selection tests in a structured and scientific manner
“in order to ensure that the organisation is capable of building a
sustainable future through, but also for, its people.”
Having acquired the best talent, organisations then need to
know how to ensure that their people are performing efficiently.
Caroline Buhagiar Klass presents the latest on performance
management in the third chapter of this book. She draws on
research, practices and international experience to propose
what could work best in the ‘island culture’ of the Maltese
work context where “who you know takes over what you know.”
Guidelines are discussed and recommended, the performance
management cycle is reviewed and the paramount importance
of being fair, just and objective when implementing performance
management programmes is heavily emphasised.
The link between business performance and motivation,
commitment and control within the emerging new realities of
the changing Maltese labour market is the subject matter of the
fourth chapter by Gottfried Catania. He presents an overview of
the main theories of motivation with an application to today’s
business realities in Malta that is experiencing unprecedented
levels of foreign workers, female participation, unemployment
rates and more job openings in the service industries.
Attracting and recruiting the right people, ensuring that their
performance is managed justly and fairly, and motivating them
xxviii Malta and its Human Resources
to be committed to the organisation, lead to yet another key

process: ensuring the retention of the best people. Hence, a focus
on well-being, quality of life and rewards. Luke Anthony Fiorini’s
chapter treats reward management, as distinct from financial
compensation, in the context of motivation and performance,
as a strategy that boosts the quality of life and the well-being
of employees. He draws on official statistics to contextualise
his discussion. He concludes that, although in general the
level of well-being amongst Maltese workers is better than
the EU average, more needs to be done in terms of addressing
occupational injuries, level of obesity, lack of physical activities
and work related stress leading to issues of mental health.
A healthy work environment is also a matter of treating
employees fairly and justly, including on matters of race and
gender. Anna Borg’s chapter tackles the issues of equality,
diversity and inclusion by presenting a better understanding
of the root causes of discrimination and its manifestation,
once again, in the context of the ever growing phenomenon
of workplace diversity in Malta. She concludes her analysis by
proposing that we address our outdated assumptions about
those people who do not fit the ‘typical worker’ template. Borg
further insists that legislative changes are also needed at the
national and the international levels in order to effectively curb
abuse, discrimination and harassment.
Along with a healthy work environment, effective reward
management, fair treatment and inclusion, employees also
expect to be offered a future. The development of human
resources in work organisations is crucial to HRM taking place
given the fundamental and continuous changes underway in
enterprises, organisations and the business environment. In the
seventh chapter of the collection, Joseph G. Azzopardi presents
a historical analysis of education, training and development to
propose a framework within which managers can proactively
decide on what works best for their respective organisations
in terms of training and development initiatives. He concludes
by recommending a shift in managers’ mind-sets from seeing
Editorial xxix
people as human resources to seeing them as resourceful

humans; and therefore a shift in emphasis from Human Resource
Management to Managing Human Resourcefulness. Drawing
on official data, he suggests that training and development are
not yet top priorities on the Maltese businessperson’s agenda;
he invites policy-makers and business leaders to proactively
construct the education, training and development models
that work best given the realities of the unique Maltese socio-
economic environment.
Providing a future to people in organisations is also about
managing the relationship between employers and employees,
between those who manage and those who are managed.
Manwel Debono gives a detailed account of the development
of trade unionism in Malta along with an analysis of collective
bargaining and trade union representation in the public and
the private sectors. He focuses on industrial relations rather
than on employee relations, given that trade union activity in
Malta is largely centred around the public sector and the large-
scale private sector organisations; while a unitarist approach to
employee relations is embraced by the micro, small and medium
sized organisations where trade union activity is next to non-
existent. He concludes by observing that trade unions in Malta
are “becoming more disenchanted with the pursuit of strikes in
their dealings with employers, while focusing more on social
dialogue at a national policy level.” He commends the setting up
of The National Forum of Trade Unions that created a platform
whereby unions can build bridges, reduce rivalry and strengthen
much needed trust amongst themselves.
The conceptual part of this publication concludes with a
focus on creativity, innovation and entrepreneurship. Leonie
Baldacchino argues that, in a world where businesses are facing
rapid changes and unprecedented challenges, organisations
become more reliant on every employee’s creativity in order
to remain competitive. She defines creativity and innovation
and explains the differences between entrepreneurship and
intrapreneurship while explicating the conditions that underpin
xxx Malta and its Human Resources
them in order for these to “flourish within an organisation,

including acceptance of risk and failure, trust, time to think,
top-down support, communication, and financial support.”
She draws on local research to conclude that there is evidence
that creativity, innovation and entrepreneurship were pivotal
for the success of a number of start-ups in Malta. These traits
were present even prior to these terms becoming ‘buzzwords’,
as “there are many fine examples of the Maltese being creative,
innovative and entrepreneurial long before these terms gained
their current popularity.”
Part Two: Seven Lessons from a Sectoral Analysis
Part Two of the book presents a broad critical scrutiny of the

situation of HR in a variety of business sectors. Seen disjointedly,
they seem to tell separate stories that are, in some ways, specific
to a particular sector and not readily generalisable to the rest.
But, on zooming in, one finds more generic lessons to be learnt
and that throw light on the holistic realities of HR in Malta.
We trace seven lessons and strong messages that come out
from these chapters in Part Two. These refer to notions of:
transformation, multiculturalism, the use of technology, sectoral
complexity, forward planning, diversity and client-centricity.
None of these are mutually exclusive but we highlight them
separately here, for ease of reference:
First, it is clear that many sectors, including traditional sectors,
are radically transforming themselves with a more ‘expert’ touch.
Certain skills that are necessary in these sectors have become
more complex and require more than casual, non-formal learning.
For instance, in the field of agriculture and fishing (Chapter 10
by Everaldo Attard), new operational and quality standards have
meant that new professionals like botanists and biologists are
required to ensure the highest quality standards in this sector.
The field – pun intended – has become specialised and more
demanding, requiring new training and up-dated programmes
Editorial xxxi
of learning. Also, those engaged in these sectors or their aides,

require new strategic and management competencies in order to
survive in a growing competitive environment. Similarly, in the
area of construction (Chapter 11 by Rita Sant): new regulations
governing health and safety and general standards in 2019 have
ushered in a sober and timely review of this sector from a more
specialised angle: not everyone can provide quality assurance;
and special training and professional skills are required; just as
more specialised workers and builders are required to engage
in more challenging structures such as high rise buildings. The
authors in these chapters proffer similar questions: do we have
these local specialised skills in the local workforce, or do we need
to rely on importing such talent from abroad?
Second, our workforce in Malta is indeed becoming
multicultural. This is explicitly spelt out in the case of the
construction industry (Chapter 11) but is also implied in other
sectors like tourism (Chapter 13 by Leslie Vella) and more
strongly in the gam(bl)ing sector (Chapter 14 by Dominic
Cortis and Elaine Falzon). What does this mean from a local
HR strategic approach? Future managers and leaders will need
to handle different mind-sets within their team; and foreign
language competence (beyond English) will become even more
vital; ironically, at a time when interest in grasping, learning and
translating foreign languages has dwindled.
Third, the issue of technology is highlighted in various chapters:
the need for the workforce to embrace the applied knowledge and
benefits that are derived from fields like Artificial Intelligence (AI)
and Distributive Ledger Technologies (DLTs) is palpable. This is
emphasised in sectors like manufacturing (Chapter 12 by David
Parnis), the Maltese public service (Chapter 16 by Joyce Cassar
and Myrna Azzopardi and Chapter 17 by Mario A. Grixti) and
healthcare (Chapter 19 by Miriam Dalmas). It is taken-for-granted
in other sectors like gaming (Chapter 14). Our organisations are
becoming more complex, more data driven and therefore the need
to develop those skills required to manage data-driven processes
is bound to increase tremendously in the future.
xxxii Malta and its Human Resources
Fourth, our local organisations are becoming more complex

because the market is becoming fragmented and more
demanding. The need to ‘strategize’ and to plan anticipated
changes will increase. The chapter on family-owned small and
medium sized businesses (Chapter 15 by Nathaniel P. Massa),
and the invitation for them to internationalise, make this very
explicit: local business models cannot always work. Similarly,
the public service is also part of a wider European network
(Chapter 16). What one requires is a deeper understanding of
how international markets operate and how international affairs
and networking will become ever more relevant as part of the
future employee’s and manager’s toolkit.
Fifth, nearly all sectors touch in one way or another on the
importance of forward planning. Manpower planning is a critical
issue and more sectors are turning to and outsourcing people,
change and development consultancy (Chapter 21 by Maria
Bartolo Zahra and Joseph F. X. Zahra) especially in the case of
the larger organisations. Manpower planning is a function of
both the changing workplace landscape and of issues related
to labour supply which often trails labour demand. Sectors
like tourism (Chapter 13), banking and finance (Chapter 18 by
Gertrude Spiteri), healthcare (Chapter 19) and higher education
(Chapter 20 by Colin Borg) evoke the need to consider strategic
planning of their manpower needs for the future. In the public
service, which is by far the largest organisation in Malta, part of
this planning is a function of the financial package presented to
newcomers (Chapter 17) which of course presents a challenge
when compared to what the private sector may be ready to pay
for similarly talented employees.
Sixth, most sectors note the diversity of their workforce in
terms of motivation and work values. In the field of agriculture
and fisheries (Chapter 10), for instance, the younger generation
(so-called millennials) are more reluctant to enter into these
specific sectors; this presents a pressing challenge. In others, like
tourism (Chapter 13), retention of millennials is a challenge as
the sector may not be the most attractive for one’s long-term
Editorial xxxiii
career plans. While, in the case of banking and finance (Chapter

18), new talent is required but millennials must be lured to
and kept on a company’s workforce by other inducements.
Organisations in the different sectors are coming to terms with
the realisation that the workforce is not homogenous but very
diverse in terms of needs, values and motives. HR professionals
should intelligently cater for these diversities.
Seventh and lastly, many of these sectors recognise that the
road to survival, if not prosperity, is to become more client-
centric. This means that both traditional and new forms of
organization that separated the supplier from the customer are
no longer viable. In traditional service-oriented sectors – as with
tourism (Chapter 13), gaming (Chapter 14), the public sector
(Chapter 16), healthcare (Chapter 19), and higher education
(Chapter 20), there is a greater push to make this happen. In
more production-oriented sectors like manufacturing (Chapter
12), this need has seen an exponential increase over the last
few years. In yet other sectors, this is beginning to show itself
through public pressure and the demand for more attention
to the community’s well-being as part of the sector’s business
agenda, as in the case of construction (Chapter 11). Even in
agriculture and fishing (Chapter 10), consumers are increasingly
curious about the origin of their food and the conditions under
which it was grown.
Conclusion
We hope that you will find the various chapters of this unique
collection interesting and insightful. Above all, we hope that the
material covered in this book provides the necessary content
to generate a better understanding of contemporary human
resource management practice in Malta, as well as the basis for
a critical debate in re-thinking our case scenario of HRM and
how people management in Malta may and should improve,
going forward.
xxxiv Malta and its Human Resources
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PART ONE
THE HUMAN RESOURCE MANAGEMENT
& DEVELOPMENT FUNCTION
Metrics, Diagnostics and
Indicators:
HR Analytics in HRM
Frank H. Bezzina and David Baldacchino
The turbulent and challenging times we live in today have

brought new challenges at the doorstep of organisations. As
well described by Patre (2016, p. 191), “the highly competitive,
uncertain and often paradoxical business environment” puts
pressure on organisations to make critical decisions on how best
to utilise their resources in order to stay competitive and increase
productivity and performance. Invariably, such decisions affect
the Human Resources Management (HRM) function of an
organisation. To be more convincing at the senior management
decision table, HRM practitioners need to shed the shackles of
the traditional ‘gut feeling’ approach and elevate the HR function
to strategic levels. A way forward for HRM practitioners would
be to bring to the decision table evidence-based proposals
backed by metrics, diagnostics and indicators collectively known
as HR analytics, “thus rescuing the HRM Cinderella image from
the dustbin and letting it be invited to the Management Ball”
(Cassar & Bezzina, 2017, p. 5).
This chapter follows this line of thought. The coming sections
highlight the need for HRM practitioners to embrace recent
advances in ‘big data’ and HR analytics and to use these tools to
4 Malta and its Human Resources
allow them to evolve their decision-making process to a more

evidence-based one which is backed by analytics. Angrave,
Charlwood, Kirkpatrick, Lawrence and Stuart (2016, p. 1),
support our stand, stating that:
Unless the HR profession wises up to both the potential and
drawbacks of this emerging field and engages operationally
and strategically to develop better methods and approaches,
it is unlikely that existing practices of HR analytics will deliver
transformational change. Indeed, it is possible that current
trends will seal the exclusion of HR from strategic, board-level
influence while doing little to benefit organisations and actively
damaging the interests of employees.
This chapter is divided into three main sections. We start

off by revisiting evidence-based management and discussing
HRM. We present our case that HRM practitioners do not
turn to evidence for decision making but at the same time
we highlight the importance of HRM practices for firm
performance. Consequently, we discuss HR analytics and finally
we highlight the requirements and competencies essential for
HRM practitioners to avoid any pitfalls when gearing up for the
use of HR analytics.
Revisiting Evidence Based Management
Evidence Based Management (EBM) knows its roots in the

medical field: in the early 1990s, Sackett, Rosenberg, Muir, Haynes
and Richardson (1996, p. 71) defined evidence-based medicine
as “the conscientious, explicit and judicious use of current
best evidence in making decisions about the care of individual
patients”. Evidence-based medicine evolved and became the
teaching standard in medical schools across Canada and the
US. Evidence-based approaches were also successfully adopted
in other fields such as policy development and environmental
studies (Cassar & Bezzina, 2017).
Metrics, Diagnostics and Indicators: HR Analytics in HRM 5
Although managers are well aware of the importance of using

reliable and valid information in support of decision making, this
‘revolution’ has not yet materialised in the management field. As
argued by Cassar and Bezzina (2017, p. 5):
The ‘revolution’ of how and why managers adopt specific
practices as opposed to others remains mostly an art in the most
raw form and subject to misconceptions, cognitive biases and
personal preferences for methods that seem to work only in the
eyes of the beholder.
Moving to EBM, this can be defined as the process of “…

making decisions through the conscientious, explicit, and
judicious use of four sources of information: practitioner
expertise and judgment, evidence from the local context, a
critical evaluation of the best available research evidence, and
the perspectives of those people who might be affected by the
decision” (Briner, Denyer & Rousseau, 2009, p. 19).
Three important conclusions can be drawn from a scrutiny
of this definition. The first is that EBM is a “non-random and
orderly process of systematically making sense of the information
available” (Cassar & Bezzina, 2017, p. 5). EBM provides the ideal
tools for HRM practitioners to evaluate employee behaviour in
a critical way, and hence extract information of the best quality
from the different sources at their disposal. This information
reduces uncertainties around important decisions and aids the
decision-making process (Barends, Rousseau & Briner, 2014).
EBM reduces the reliance on old or tried and tested formulae
which do not necessarily provide managers with reliable or valid
results or with the ‘best’ plan of action (Cassar & Bezzina, 2017).
The second is that evidence-based practice is based on
evidence from different sources. Barends et al. (2014) indicate
four sources of evidence: scientific (for example evidence derived
from the findings published in scientific research journals);
organisational (any data, facts and figures that are gathered
from the organisation); experiential (the professional experience
and judgment of practitioners); and stakeholder (the values
and concerns of people who may be affected by the decision).

According to Rousseau and McCarthy (2007), evidence-based
teaching that relies on science follows a sequence of four steps:
(1) concentrate and adopt principles where the science is clear;
(2) cultivate awareness in professional decision practice; (3)
recognise and identify underlying factors related to decisions;
and (4) contextualise any knowledge gained from the available
evidence.
Finally, the third and most important conclusion is that, as
much as decision making is at the heart of management practice,
decisions also form the core of EBM (Baba & HakemZadeh 2012;
Cassar & Bezzina, 2017). Decisions taken by managers within
organisations always have repercussions on time, finances and
resources and therefore form an important foundation of that
manager’s learning curve. Since nowadays the market topography
that organisations are faced with is complex, challenging,
uncertain and therefore risky (Bhalla, Dyrchs & Strack, 2017),
there is an increased need to discard failed business models
and focus more on developing the capacities of organisations
to forecast and manage risks during processes of adaptation
(Cassar & Bezzina, 2017). Briner (2007, p. 3) argues for the need
to advance evidence-based practice by “making evidence from
systematic research available to practitioners along with the skills
and support required to make judgements about its validity and
usefulness”. Hofmann and Frese (2011) support Briner’s view;
they argue that management scholars and researchers have an
important role to play in advancing research on how decision
making is construed (for example, how people evaluate risks).
Are HRM Practices Evidence-Driven?
After discussing EBM, we turn our attention to HRM. We will start

off this section with this interesting quote by Briner (2007, p. 1):
From fortune-tellers to football managers and from homeopaths
to home secretaries, all practitioners tend to believe quite
strongly that what they do is based on evidence. To challenge

this belief is likely to provoke a reaction somewhere between
mild puzzlement and deep offence in most practitioners.
The HRM practitioner is no exception. Even though

research points to the link between HRM and organisational
competitiveness (Jackson, Schuler & Jiang, 2014; Saha, Gregar
& Saha, 2017), HRM practitioners, like many others, make
decisions without systematic evidence, just based on ‘gut
feelings’ as already pointed out above. Reviewing some of the
most important studies in the field supports this dictum. A study
conducted by Rynes, Colbert and Brown (2002) concluded that
HRM managers in the US rely mostly on what they believe is best
mainly due to a lack of knowledge held by these practitioners. A
Dutch study came to a similar conclusion: there is a gap between
what evidence states and what the practitioners believe with
regards to recruitment and selection decisions (Sanders, van
Riemsdijk & Groen, 2008).
Particularly in management sectors such as HRM, managers
tend to opt for a ‘quick fix’, given that they are faced by large
amounts of evidence that overwhelms them, thus making
it difficult for these managers to be more evidence based
(Briner, 2007). In a survey of over 1,500 practitioners in the
management field in Belgium, the Netherlands and the US,
Barends, Villeneuva, Briner and ten Have (2015) concluded
that the main barrier for translating research to practice is time
and this is mostly attributed to the fact that academic material
and journals in the field are very difficult to read. Finally, a
study of HRM practices amongst practitioners in Poland,
Croatia and Malta found out that misconceptions related to
evidence-based principles of people management ranged from
26% to 86% of the total number of issues being misconceived
by the participants (Bezzina, Cassar, Tracz-Krupa, Przytula &
Tipuric, 2017). In this study, HRM practitioners confirmed the
views of Barends et al. (2015) when they admitted that they were
more likely to access the required knowledge for applications
through popular sources rather than more reliable ones. This is

mainly due to time constraints, inaccessibility and inability to
evaluate the evidence.
The emerging general picture is that, despite its importance,
HRM is still a field of practice for a broad group of professionals
and such practices do not necessarily involve any evidence-
based decision-making process. On the contrary, we dare say
that HRM practitioners carry out the HRM job without a precise
approach and following gut feelings. Can this state of affairs
persist, considering the shift to a more strategic role for HRM in
today’s complex world of work?
Strategic HRM in the New World of Work
Many researchers argue that HRM has shifted its focus to a

more strategic one, shedding its traditional administrative role
(Brewster, Gooderham & Mayrhofer, 2016; Cassar, Tracz-Krupa,
Bezzina & Przytuła, 2018; Dik, Byrne & Steger, 2013; Schuler,
1992). Armstrong (2006, p. 3) defines HRM as:
A strategic and coherent approach to the management of an
organisation’s most valued assets: the people working there who
individually and collectively contribute to the achievement of its
objectives.
Lending support to Armstrong’s claims, Momin and Taruna

(2015, p. 688) argue that “human resource management is a
function in the organisation specifically envisioned to capitalise
on the employee’s performance in service of an organisation’s
strategic goals”. While this dictum garners support from those
in HRM, numerous researchers have voiced their concerns on
the effective contribution and value of HRM to the firm. There
are multiple explanations for this: HRM being too theoretically
deficient due to its broad reach (Noon, 1992); creating high
expectations and then not delivering (Mabey, Skinner & Clark,
1998); and HR research being ‘conservative’ and ‘irrelevant’
(Delbridge, 2010). Kochan (2007, p. 599) also claims that the

HRM profession “faces a crisis of trust and a loss of legitimacy in
the eyes of its major stakeholders”.
Cassar and Bezzina (2017, p. 7) argue that, in today’s world
of work, “HRM has often been considered as a central element
that drives the organisation towards its general objectives and
performance targets”. In line with this claim, Bowen and Ostroff
(2004, p. 206) define the HRM process as:
… how the HRM system can be designed and administered
effectively by defining meta features of an overall HRM system
that can create strong situations in the form of shared meaning
about the content that might ultimately lead to organisational
performance.
This means that there is a shift of attention in the HRM field

from “what elements of HRM potentially affect employee and
firm performance, to how HRM as a system affects performance
as part of a process” (Farndale & Sanders, 2017, p. 134). In
order to measure the ‘how’, numerous researchers point to
HRM embracing HR analytics (Briner & Barends, 2016; Momin
& Taruna, 2015; Pfeffer & Sutton, 2006; Rousseau & Barends,
2011). Lawler, Levinson and Boudreau (2004, p. 28) state:
If HR can make a strong case for being an important part of
strategy development and implementation because of the
importance of human capital, why does HR often fall short of
being a strategic partner? At least one possibility is because
HR lacks the type of analytic and data-based decision-making
capability needed to influence business strategy.
For HRM professionals to stake a claim at the decision table, they

may need to back their strategic approaches with HR analytics.
Momin and Taruna (2015, p. 688) support such claims:
HR analytics plays a very important role in aligning the HR
strategy with the overall business strategy. HR analytics aids
the HR managers to formulate the strategies which enable the
organisation to gain an upper hand over its competitors.
Bondarouk and Brewster (2016, p. 2652) follow a similar train

of thought:
… rapid technological developments offer a new, smart, digital
context for HRM practices with the better quality HRM data
and enabling a strong HRM ownership by all stakeholders.
Finally, what can be said about HRM in Maltese

organisations? Although research is scant, collaborative studies
between PricewaterhouseCoopers (PwC) and the Foundation
for Human Resources Development (FHRD) carried out during
2016 and 2017 shed some light on the HR function in Maltese
Organisations. Online surveys were distributed to a sample of
HR practitioners/managers, CEOs and Managing Directors/
General Managers across organisations of different sizes and
sectors across the Maltese Islands. The results from the 2016
and 2017 surveys show a shift of the HR function towards a
more strategic approach (as opposed to the more traditional
operational approach). Although this indicates that organisations
in Malta are starting to embrace a more strategic role for their
HR function, this shift is not very pronounced. Furthermore,
the respondents have, over both surveys, identified poor
implementation of HR practices by management and insufficient
resources within HR department as being among the top three
barriers affecting negatively the HR function. This shows that
“obtaining the buy in from top management to give HR the
time and importance it deserves, and to see the value it can
bring to the business is constantly an obstacle HR professionals
are striving to overcome” (PwC & FHRD, 2017, p. 5). In light
of these findings, can the HRM practitioner further convince
top management of the importance of the HR function for
strategy development and implementation through the effective
manipulation of HR analytics?
HR Analytics
Human Resource Analytics (HRA) is a relatively new term. It

probably made its first appearance in an article by Lawler et al.
(2004) where a distinction is proposed between HR analytics
and HR metrics: HR metrics are considered as measures of
key HRM outcomes. HR metrics can be classified as efficiency
metrics, human capital metrics and effectiveness/cost benefit
metrics (Dulebohn & Johnson, 2013). Examples of efficiency
metrics include: the HR expense per employee; the cost per hire;
and the costs of any employer-sponsored health plan of each
employee. Examples of human capital metrics include: labour
cost factor (calculated as: compensation plus benefit costs
divided by the total full-time equivalent (FTE); and profit per
employee: (revenue less operating expense divided by the total
FTE. Finally, examples of HR effectiveness/cost benefit metrics
include: the progression of employees through the organisation’s
HR development plans; and firm salary/competitor salary ratio
(Dulebohn & Johnson, 2013).
On the other hand, HR analytics, as discussed in more detail
below, is not simply measures but rather represents statistical
techniques and experimental approaches that one can adopt to
show the impact of HR activities.
HR analytics is defined as being either an analysis process or
a decision-making process (Falletta, 2014; Marler & Boudreau,
2017; Pape, 2016). Some definitions are more specific and go into
the detail of mentioning specific components of HR analytics,
that is, either specific practices (Falletta, 2014) or specific
analyses (Harris, Craig & Light, 2011). Bassi (2011, p. 16) states
that HR analytics,
… is an evidence-based approach for making better decisions
on the people side of the business; it consists of an array of tools
and technologies, ranging from simple reporting of HR metrics
all the way up to predictive modelling.
Thus, Bassi (2011, pp. 15-16) considers HR analytics as a mix of

three components: (1) the notion of evidence-based approaches
to help HRM practitioners make decisions; (2) “a process for
systematically reporting on an array of HR metrics, such as
time to hire, turnover, compensation, employee engagement”;
as well as (3) “high-end predictive modelling (such as ‘what if ’
scenarios that “forecast the consequences of changing policies
or conditions”).
Mondare, Douthitt and Carson (2011, p. 21) view HR
analytics as being linked to strategic HRM and thus define it “as
demonstrating the direct impact of people data on important
business outcomes”. Marler and Boudreau (2017, p. 15) propose
that HR analytics is,
… a HR practice enabled by information technology that uses
descriptive, visual, and statistical analyses of data related to
HR processes, human capital, organisational performance and
external economic benchmarks to establish business impact and
enable data-driven decision-making.
Looking at these definitions and descriptions allows us to

highlight five important points: First, HR analytics is not HR
metrics: the latter is only a ‘subset’ of the former. HR analytics
involves more complex and sophisticated analysis of HR-related
data. Second, the focus of HR analytics is not exclusively on HR
functional data, but it also integrates data from other different
internal functions and also data that are external to the firm.
Third, HR analytics involves the use of Information Technology
(IT) to collect, manage and report data. Fourth, HR analytics
is about providing support to people related decisions. Finally,
the last point about HR analytics is the most compelling since it
links HR analytics to strategic HRM literature since HR analytics
has the potential to link HR decisions with business outcomes
and organisational performance. Marler and Boudreau (2017, p.
15) claim:
HR Analytics appears to offer more than HR Metrics through

its potential to connect HR processes and decisions with
organisational performance, which is an avenue to elevating
HRM to having a more strategic role and joining other business
functions at the strategy table.
HR analytics influence employees since they are designed

to provide HRM practitioners with information that links
HRM processes to employee behaviour and attitudes and thus
ultimately to organisational outcomes (Marler & Boudreau,
2017). Reilly (2016) explains how this influence occurs by
describing some ‘on the ground’ uses of HR analytics. These
indicate people related issues (such as through an analysis
of effectiveness metrics) that need to be tackled to improve
sales: for example, which management characteristics are most
effective at eliciting improved team performance? HR analytics
can also shed light on whether there is a link between employee
engagement and productivity, and in which ways can the latter
be raised through engagement interventions. HR analytics also
indicates, for example, through manipulation of labour cost
metrics, those elements within the organisation that can be acted
upon to minimise costs and improve business performance.
Finally, HR analytics helps in identifying which HR practices are
associated with encouraging innovation within the organisation.
Theoretical Frameworks Supporting HR Analytics
Several researchers (Douthitt & Mondore, 2014; Marler &

Boudreau, 2017; Rasmussen & Ulrich, 2015) refer to the Resource
Based View (RBV) of the firm as the main theoretical framework
supporting HR analytics. The RBV posits that, to gain a sustained
competitive advantage, firms must use resources that are rare,
valuable, hard to copy and non-substitutable (Barney, 1991).
Thus, the implications of the RBV for HR analytics is that, to
be associated with increased performance and to give the firm
a competitive edge, HR analytics must be unique (for example

based on that particular organisation’s metrics which reflect its
unique resources) and value producing (Marler & Boudreau,
2017). Another theory adopted is the Agency Theory. Aral,
Brynjolfsson and Wu (2012), using a panel sample of 189 firm-
level data collected between 1995 and 2006, concluded that, when
a company adopts a combination of HR analytics, Human Capital
Management (HCM) software and rewards performance, it will
become more productive because this particular combination
allows managers to monitor employee behaviour while at the
same time align incentives. A distinctive feature of this study is
that the authors exploited the longitudinal nature of their data
to establish a cause and effect relationship, showing that the
combined effect of all three factors produced subsequent higher
firm-level performance; whereas, if HR analytics was used alone,
it did not enhance productivity. Thus, HR analytics was shown
to predict productivity if combined with the HCM software
alone or if combined with both pay for performance and HCM
software.
Is HR analytics at a Risk of Becoming Another Managerial Fad?
In spite of all this, we must be wary of how HR Analytics might

turn out to be yet another managerial fad. Abrahamson and
Eisenman (2008, p. 720) describe fads as “largely insignificant,
non-rational swings that come and go with little or no lasting
impact on the language of management techniques or
organisations themselves”.
We identify two main reasons for these claims. First, there
is a fear that HR analytics may become a fad due to the lack of
empirical studies showing relationships between HR analytics
and financial performance. Out of 14 articles empirically testing
hypotheses, Marler and Boudreau (2017) found only one study,
by Aral et al. (2012), that did provide strong evidence for a
cause-effect relationship between HR analytics and financial
performance. Other studies provide non-empirical evidence

regarding a positive relationship between business impact and
the use of HR analytics. One such example is a case study carried
out by Coco, Jamison & Black (2011) at the home improvement
retail chain Lowes detailing the use of HR analytics to establish
a link between HR processes, employee engagement and store
performance. Through HR analytics, Lowes was in a position to
conclude that highly engaged employees manage to produce 4%
higher average customer ticket sales per store. By using high-
level case study examples, Harris et al. (2011) describe the six
analytical tools they claim constitute HR analytics and link them
to business impact. Examples illustrated by this study include
Google’s use of HR analytics to predict employee performance
using applicant database and Sysco’s utilisation of analytics to
establish causal links between work climate surveys, delivery
driver employee satisfaction, customer loyalty and higher
revenue (Marler & Boudreau, 2017).
The second reason is the lack of uptake of HR analytics by
companies, in spite of the evidence for a causal link between HR
analytics and business outcomes. In a survey conducted across
220 ‘Fortune 1000’ firms, only 15% of the participants stated that
HR analytics played a key role in determining or implementing
strategy (Falletta, 2014). Studies by Lawler et al. (2004) and Lawler
and Boudreau (2015) amongst 100 ‘Fortune 500’ companies
concluded that less than one third of these companies utilise HR
analytics to measure relationships between HRM processes and
people and business impact. Finally, Deloitte conducted a global
study involving some 3,300 business and HR leaders from 106
countries. It concluded that only 35 percent of the respondents
indicated that HR analytics was ‘under active development’ in
their organisation; and only 8.4% of the respondents believed
that their organisations had a strong HR analytics team in place.
Most organisations, even large multinationals, still appear to lack
a clear vision of the future of HR analytics within their company
(van den Heuvel & Bondarouk, 2017).
Here lies the paradox: why is there such a limited uptake of HR
analytics by organisations when the literature and the evidence

hint towards a positive association between HR analytics and
organisational outcomes? Are some factors dissuading HRM
practitioners from embracing HR analytics?
Gearing HRM Practitioners for HR Analytics
The literature identifies three complementary enablers for a

successful adoption of HR analytics by an organisation and which
affect HR analytics outcomes. These are: (1) proficiency in data
manipulation and analytic skills by HRM practitioners (Angrave
et al., 2016; Cassar & Bezzina, 2017; Marler & Boudreau, 2017);
(2) adequate HR information technology (Angrave et al., 2016;
Douthitt & Mondore, 2014; Marler & Boudreau, 2017); and (3)
getting ‘on board’ other managers from different departments
and functions within the firm (Cassar & Bezzina, 2017; Marler &
Boudreau, 2017; Rasmussen & Ulrich, 2015).
We start with the most frequently cited reason why HR
analytics is not more widely adopted: the lack of proficiency in
data manipulation and analytics skills by HRM practitioners.
Bassi (2011) argues that the lack of this skills set among HRM
practitioners is shifting the responsibility for analytics towards
the IT and finance functions within the business. Angrave et al.
(2016, p. 7) share the concerns expressed by Bassi (2011) when
they state that:
If HR is not fully involved in the modelling process, there is
significantly greater scope for models to be constructed in a
way which fundamentally misunderstands the nature of human
capital inputs into the processes of production and service
delivery. Instead of recognizing the flexibility of labour; that
productivity and performance change with skills, motivation
and design of people-process interactions, labour is modelled
as a fixed cost that needs to be controlled. Unless analytics is
embedded in a full and comprehensive analytical model, the
more limited information available in dashboard formats may
be misinterpreted by operational and financial managers with

limited patience for/or understanding of HR.
Thus, the lack of proficiency in analytical skills does not only
affect the uptake of HR analytics by organisations; it may also risk
misinterpretation of the analyses done since such analyses will
not be carried out by HRM professionals. This is a worrying state
of affairs since not only will HRM professionals miss a glaring
opportunity to develop competencies that will improve their
strategic decision-making, thus impacting on organisational
performance; but “also it may be problematic for society in that
employees and employment opportunities may be negatively
impacted” (Marler & Boudreau, 2017, p. 19).
This lack of ability to analyse HR data seems to be one of the
top concerns expressed by HRM practitioners in Malta. In a
collaborative study between PwC and FHRD across organisations
of different sizes and sectors across the Maltese Islands, 47% of
respondents stated that the ‘lack of ability’ to analyse HR data
was affecting the performance of their HR function. They placed
competence in HR analytics as the second top barrier negatively
affecting the performance of the HR function within their
organisation (PwC & FHRD, 2017).
Levenson (2011) spells out the analytical competencies
required by HRM professionals to perform HR analytics
effectively. These are basic and intermediate levels of data
analyses proficiency, interpretation techniques for basic and
advanced multivariate models, data preparation, root cause
analysis, research and survey design, and finally quantitative
data collection and analysis competencies. In a survey of HR
analytics, Levenson, Lawler and Boudreau (2005) concluded
that the higher-level statistical skills needed to establish business
impact are neither in high demand, nor are in adequate supply.
In fact, the survey reported that less than one third of HR
analytics professionals reported having competency in advanced
multivariate statistics. That proportion drops down to only 3%
when only considering HRM professionals not specifically hired
for HR analytics. Rasmussen and Ulrich (2015) more recently
argued that, besides the shortage of technical skills, there is also

a shortage of HRM leaders with a clear business focus.
The second enabler described by many articles is HRM
information technology, such as Human Capital Management
(HCM) software. Aral et al. (2012) have empirically shown
that companies embracing HR analytics but lacking HCM
software showed no performance effects. IT can act as
an enabler through HRM IT/e-HRM intended to capture,
store and make readily accessible data from across company
functions and produce reports, dashboards and scorecards.
However, current IT systems can prove to be a significant
obstacle to HR analytics since they do not offer the required
HRM IT support. Some of the problems noted in the literature
include: inaccurate data being collected (Angrave et al., 2016;
Pape, 2016); production of basic reports based on outdated
or flawed descriptive and efficiency-based metrics (Angrave
et al., 2016; Falletta, 2014); and lack of accessibility to data
due to either lack of integration across the various functional
units and divisions or due to geographical reasons (Douthitt
& Mondore, 2014).
The third and final point that requires attention for HR
analytics to be successful is for HRM professionals to develop
a better ‘connection’, through their work relationships, with
other departments in the business. In this way, they can tap
into data inherent to other functions that will help them to
carry out their analyses. An appropriate collaboration between
HRM practitioners and other disciplines within the business -
such as finance, engineering, marketing and operations - may
be fundamental for the development of logical frameworks for
HR analytics that can involve key decision-makers and connect
more clearly to organisational outcomes (Cassar & Bezzina,
2017; Marler & Boudreau, 2017).
HRM professionals must also nurture relationships with
senior managers. In the Lowes study, the HR team went to great
lengths to foster trust and buy-in for their HR analytics project
with senior managers (Coco et al., 2011). Senior managers may
be averse to data that can challenge their beliefs. Marler and

Boudreau (2017, p. 19) argue that:
There is a tendency to reject data that threatens existing beliefs.
When new data suggests personal beliefs are misguided, people
choose their belief system and reject the data. In order to
overcome such resistance, those involved in HR Analytics must
involve key stakeholders in the process ahead of conducting the
analyses.
Conclusion
This chapter has reviewed the need for HRM practitioners to

embrace a more strategic role within their organisation by
shedding old dictums and ‘gut feeling’ approaches to decision
making and embracing a more evidence-based approach. It
has also argued that the field of HR analytics promises to help
HRM practitioners to provide insights related to business trends
and organisational outcomes that would help improve a firm’s
performance. As Ulrich (1997, p. 231) states:
No one can predict the future course of the HR profession. No
one can predict how HR practices will change in the future.
Thinking about the future, however, helps us to prepare for it.
We agree with Ulrich (1997): even though we have no crystal

ball, advancing research in the promising field of HR analytics
(for example, by exploring the current skills and competencies of
Maltese HRM practitioners in view of the particular competencies
required to perform HR analytics effectively) may well hold the
key to unlocking a brighter future for the HRM field; and one
where HRM professionals, including those in Malta, gain leverage
and influence in organisational decision making.
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Selection, Recruitment and
Induction
Malcolm Pace Debono & Petra Sant
Maltese organisations have entered into a new dawn. Workforce

demographics have changed drastically and organisations are
being impacted by numerous drivers of change. The country
has registered a labour force in excess of 200,000; the amount of
individuals graduating with a tertiary level degree is increasing;
and the female participation rate has shot past 50% and is still
rising. This situation is also accompanied by an aging workforce
and an increase in non-Maltese nationals, now about one sixth
of the country’s labour force.
Numerous change drivers have also caused a massive shift
in the type of occupations required in today’s labour market.
Traditional blue collar employment has almost disappeared
whilst white collar employment is on the increase. These
drivers of change have been with us for almost three decades
and include: the increase in technology at work (Davis, 1995;
van der Spiegel, 1995); changes in the political, economic
and social context of new emerging economies, giving rise to
multicultural organisations (Pearce, 1997; Wever, 1995); the
consequential demise of traditional work and career attitudinal
principles like job security and their replacement with mobility
and employability (Carnevale, 1995; Hartley et al., 1991;

Herriot, Pemberton & Hawtin, 1996); the applications of new
management and organisational practices towards securing
more competitive work organisations (Gallie et al., 1998; Guest,
1995; Mohrman & Cohen, 1995); the institutionalisation of new
work schedules like flexibility, contingent employment and part-
time work (Barker, 1995; Reilly, 1998a, b; Wiesenfeld & Brockner,
1998); the relative decline in trade union membership (Guest
& Hoque, 1994; Hartley & Stephenson, 1992; Marchington &
Parker, 1990); changing skill requirements (Arnold, 1997) as
well as newly emerging demographic trends of the work force
(Alvesson, 1998; Offerman & Gowing, 1990).
The collective impact of these drivers has heaped numerous
talent-related pressures on organisations. Skill requirements
have changed, occupations are being redefined, competition
for talent has increased, and employees no longer work for one
organisation throughout their entire career.
Such changes and influences have forced organisations to
re-think their people strategy. This chapter will first discuss and
explore changes and trends in the Maltese work context and then
move on to explore the concept of talent acquisition and what it
means for Maltese organisations.
The Maltese Context
The following section utilises EU and NSO data to contextualise

this chapter and provide insight into influences on the work
context of the Maltese Islands.
Business Demography
The Business Register (NSO, Business Demographics: 2012-

2017, 2018a) shows that, in 2017, registered business units
amounted to 103,458, an increase of 6.9% from 2016. Just over
Selection, Recruitment and Induction 25
97% of registered businesses were micro entities employing

less than 10 persons. Only 112 registered businesses employ
more than 250 persons each. The number of limited or public
liability companies has increased systematically over the years,
with an increase of 6.9% over 2015. In 2017, 46.4% of registered
businesses were sole owners or partnerships, 49.8% were limited
liability or public limited companies, the remaining 3.8% had
other types of legal organisation (such as cooperatives).
Labour Market Overview
Employed Population
Labour force data (NSO, 2018b) shows that, in Malta, on
average, out of every 100 persons aged between 15 to 64 years,
71 are employed. The male employment rate for this age bracket
is over 80%, while the female employment rate stands at almost
60%. A gender gap in employment rates persists, but the female
employment rate has increased significantly over the past
years, while the male rate has steadied. The largest amount of
employed individuals fall within the 25-34 year bracket, for both
males and females. Self-employed persons account for 14.4%
(NSO, 2018) of all persons with a main job. Persons working
full-time totalled 198,940; while another 32,210 had a part-time
job as primary employment. On average, full-timers work 41.7
hours a week, while part-timers work 23 hours per week. The
average annual basic salary of employees for the second quarter
of 2018 is estimated at €18,940. Average annual salaries varied
from €33,780 for managers to €12,100 for those engaged in
elementary occupations.
The Unemployed and Inactive Population

The unemployment rate for the second quarter of 2018, stood
at 3.8%, with the largest share of unemployed persons recorded
among persons aged 25 and over. Among the unemployed,
75.4% stated that they had been looking for work for less than
12 months. According to the Labour Force Survey of the NSO
carried out in 2017, there were 81,000 inactive individuals

between the ages 15-64, of which 58,000 were female.
World Economic Forum (WEF) Report

The 2017 Global Competitiveness Report (Schwab, 2018) shows
that some of the most serious challenges to doing business in
Malta involve people issues. The executive opinion survey listed
an insufficient capacity to innovate, an inadequately educated
workforce, and a poor work ethic as some of the top problems.
Future Jobs and Skills

The economic landscape is evolving fast. A January 2016 report
on ‘The Future of Jobs’ (World Economic Forum, 2016) noted
that the most in-demand occupations today did not exist a
decade ago. Couple this statistic with the accelerating rate
of change, and one can deduce that most of our children who
started secondary school in October 2018 (most of whom will
be choosing career-defining subject paths) will end up working
in jobs which do not yet exist today. It is therefore critical, for
all stakeholders, and most notably, Malta’s future employees, to
anticipate and prepare for future skill requirements in order to
seize opportunities and mitigate negative outcomes.
We are at the doorstep of the Fourth Industrial Revolution.
This was one of the thrusts of Davos 2018, where experts have
warned that, by 2030, robots could replace 800 million jobs.
Jobs which are inherently routine or repetitive will become
automated. Highly skilled jobs also face risks from automation:
mathematical technicians, credit analysts and accounts clerks
have a strong chance of being replaced by computers (Frey &
Osborne, 2013).
There are two silver linings to this argument. The first is
that automation will replace jobs only gradually. It will take
time to replace an entire occupation: automation can, and will,
start replacing some tasks, freeing up time to be spent on more
productive endeavours. A McKinsey Report (McKinsey Global
Institute, 2017) revealed that very few occupations (less than
5%) will become fully automated by 2030; however, in about 60%

of jobs, at least one third of tasks can be fully automated. This
implies significant expected job transformations.
Secondly, technology will ultimately destroy jobs (whether we
like it or not), but it will, in the long-run, open up a raft of new
opportunities. This is called the Luddite fallacy: the observation
that improved technology has, historically, not just destroyed
jobs but also led to a restructuring of the job profile composition.
Technology will result in temporary structural unemployment
but it will create jobs elsewhere in newly created industries
both directly (design, build, and maintenance of machinery) and
indirectly (efficiencies in creating value will spill over as new
investment and increased spending). Amazon is perhaps a good
example of this phenomenon: over recent years, it has increased
its warehouse robots from 1,400 to 45,000. However, in doing so,
it has managed to reduce prices and attract more demand, which
in turn created an increased need to hire more workers.
Technological Obsolescence
Some workers will find themselves losing their job because of
technological change, with the most susceptible occupations
being manual or low-skilled types. The key, therefore, is two-
fold. The first is to invest in skills which are differentiated from
computers and robots; thus protecting and nurturing creativity
and relationship building.
Jack Ma, founder of Alibaba Group and Chinese business
magnate, believes that “if we do not change the way we teach,
30 years from now, we’re going to be in trouble”. Speaking at
the World Economic Forum 2018, he stressed that the current
approach of imparting knowledge is not good enough. In a few
years, our children, the workers of tomorrow, would not stand a
chance to compete with machines. Schools should therefore focus
on teaching ‘softer’ skills like independent thinking, teamwork,
leadership, compassion, curiosity, creativity and values – aspects
which are hard to replicate, but not impossible to emulate, with a
machine – rather than information cramming and arithmetic. In
a few years’ time, being served coffee in a coffee shop would be

fully automated and much more efficient; but customers would
perhaps still demand a human barista they can interact with.
Similarly, in choosing (or maturing in) an occupation, one
should not underplay the importance of the required soft
skills, as opposed to the technical skillset, as the latter is more
susceptible to automation. Nursing, for instance, an occupation
which involves building complex patient to carer relationships,
is highly resilient to automation. Notwithstanding, although
humans are better equipped at genuine creativity bouts, robots
will soon catch up in this sphere as well – indeed, they are already
capable of producing music or art.
The second is to invest in highly transferrable skills to promote
occupational mobility, involving reskilling and lifelong learning.
When British coal miners lost their jobs to innovations in the
manufacturing industry, many unskilled workers had limited
skill sets (and limited geographical mobility) and therefore
found themselves unemployed. This is because such immobility
(occupational and geographic) hindered their transition to the
newly created jobs within the economy. It is therefore imperative
for employees to invest in skills that are easily transferrable to
other occupations. Equally important, national education policy
should be directed towards re-skilling, re-training and life-long
learning with a view to combat labour market inflexibility, fuel
future economic growth, and enhance societal resilience in the
face of rampant technological change. For companies, reskilling
and upskilling strategies are critical if they are to recruit and
retain talent which adds value to their bottom-line, and protects
their long-term competitiveness.
Sectorial Growth
Demand for labour is a derived demand: it is related to the demand
for services and physical goods. In this respect, inspecting
which sectors are doing well (and which are dying out) is a
valid gauge for future job prospects. An increasing Gross Value
Added (GVA), for instance, could signal that compensation to
employees is also increasing (assuming constant proportions

of GVA components). This can either be a result of higher
wages, higher employment, or a combination of these. National
Statistics Office (2017) provides insights into which are the
largest constituent sectors of the Maltese economy, and which
sectors are experiencing the strongest growth, in terms of their
contribution to both GVA and employment.
In terms of GVA, the sum of profits and employee
remuneration, the largest sectors during 2016 were:
• Wholesale and retail trade; repair of motor vehicles
and motorcycles; transportation and storage;
accommodation and food service activities (representing
21% of GVA);
• Public administration and defence; compulsory social
security; education; human health and social work
activities (18%);
• Arts, entertainment and recreation, repair of household
goods and other services (13%); and
• Professional, scientific and technical activities;
administrative and support service activities (13%).
The above categories encompass several key industries

and sectors in the Maltese economy, including retail, tourism,
financial services, gaming and the public sector.
In terms of employment, the main job-rich sectors in Malta
are:
• Wholesale and retail trade; repair of motor vehicles
and motorcycles; transportation and storage;
accommodation and food service activities (representing
26% of total employment);
• Public administration and defence; compulsory social
security; education; human health and social work
activities (24%);
• Professional, scientific and technical activities;
administrative and support service activities (14%); and
• Manufacturing (12%).
Looking to the Future

The current situation in Malta is telling of the future. The nation
is evolving into a highly service-based economy. Demand for
employees within the professional services, financial services
and the gaming industry is likely to continue to increase. More
specifically, these industries are likely to demand personnel with
skills and experience in finance, data analysis, ICT, and customer
support. Shortages of these skill sets amongst the local population
would create an incentive for employers to seek out recruits
from overseas, which in turn will continue to place additional
pressures on the local property market. A continuation of the
construction boom, will see the construction industry continue
to demand more workers, particularly skilled labourers, which
are in short supply.
Capacity and Capability

Skills demands are influenced not only by industrial
restructuring, but also by changes within specific industries. The
classic example in the Maltese economy was the restructuring
of Malta’s tourism industry over the past decades, shifting
from one predominantly dominated by tourists originating
from the United Kingdom in the spring and summer months,
to one equally balanced between UK and continental European
tourists, with more emphasis on fleshing out the shoulder and
the winter months. With this change in the industry, the labour
market experienced changes in the demand for language skills,
changes in the emphasis on service levels and the introduction
of the Institute of Tourism Studies to cater for changing patterns
of tourist expectations.
Since demand for labour is a derived demand, it exists to fulfil
a need to produce goods or deliver services which are ultimately
requested by the end consumer. In this sense, demand factors in
the economy play an important role in shaping the employment
landscape, especially since demand is immediate, as opposed to
labour supply which responds with a lag. It is therefore natural
that in full employment economies which are thriving and
growing at a quick steady pace, capacity and skills gaps become

an issue.
Capacity shortages
As of writing, Malta’s economy is performing strongly, growing
at a nominal rate of 8.3% and a real rate of 6.2% (first six months
of 2017), and outperforming its peers in the EU block. Along
with traditionally strong tourism, and retail and wholesale trade,
i-gaming, financial services, legal and accounting services and
aircraft maintenance have also become drivers of diversified,
economic growth. The Employability Index (2015) shows that
most graduates from Malta’s further and higher education
institutions find jobs that match their qualifications and their
field of study.
However, the picture is not all so rosy. This buoyant
economic environment generally (but not necessarily)
results in employment growth – a 3.4% increase over 2016 –
predominantly in the services sector. Despite this growth in
employment, feedback obtained from several focus groups held
as fieldwork in the development of an Occupational Handbook
for Malta, by KPMG, for Jobsplus in 2018, points towards a clear
capacity shortage in multiple sectors, including construction,
hospitality and ICT. This is resulting in two trends in the labour
market: enhanced bargaining power of employees (which pushes
up wages); and the importation of labour (which acts as an
equilibrating factor).
Skills Shortage, at both ends of the skills spectrum

Apart from a capacity shortage, employers are also finding
it difficult to recruit people with the right set of skills. This
shortage is predominantly pervasive in occupations which
either require a highly specialised skillset (whether it is manual
work or otherwise), or those which do not require any particular
skills. According to the Malta Employee Skills Survey conducted
in 2016 by the NCFHE, employers resort to different methods
in order to address these recruitment difficulties, including
recruiting non-Maltese nationals, increasing expenditure on

advertising and recruitment, and improving salaries and the
overall conditions of employment.
Furthermore, the 2016 EC Report on Education and Training
Report for Malta, states that available international studies show
that basic skills attainment is rather poor. Vacancy bottlenecks
have emerged and are identified across the entire skills spectrum.
The greatest recruitment difficulties appear in highly-skilled
occupations, including health care, financial services and ICT.
With regards to unskilled occupations, the hospitality and
tourism sector appears to be the most affected.
Vocational education and training (VET) and employment
policies aim at increasing the skilled workforce, to satisfy the
expanding economy’s current and future skill needs and to
manage the impact of an ageing population. The focus is on
further reducing early leaving from education and training
and inactivity among the young – those referred to as not in
employment, education or training, NEETs – while encouraging
labour market participation of older people. Recent early leaving
measures include new second chance options, better support for
teachers and introducing vocational subjects in lower secondary
schools to provide an alternative pathway to learners. Malta also
adopted a National Lifelong Learning Strategy 2020 to empower
citizens through more personalised and innovative approaches
to adult education. Reforms planned for the 2019/20 school
year paves the way for equitable quality learning in secondary
schools. The objective is to achieve parity of esteem between
traditional/academic and vocational/applied learning tracks.
Making learning inclusive, flexible and without dead-ends,
the reform challenges the current compulsory one-size-fits-all
schooling system; giving young people more opportunities to
develop their employability and skills for personal and social
development, is an important step forward.
The Drivers of Change

Looking ahead, one can never be certain of how socio-economic
and technological shifts can affect the workplace. However,
one can contemplate and assess a number of key thrusts and
postulate that these will redefine our future. These are reviewed
below. A sensibility to such forces and trends would need to
guide organisational strategy; this includes decisions impacting
on ‘capital versus labour’ substitutability, and therefore on
selection and recruitment at the firm level.
Drivers of Change – Socio-Economic

A key socio-economic driver of change is the changing nature
of work environments and the emergene of flexible working
arrangements. Advances in information and communications
technology will enable workplaces to continue the adoption of
technologies which allow for more flexible working conditions
including remote working and teleconferencing. The adoption
of such technologies will allow organisations to streamline their
core staff complement to include only those human resources
required to fulfil core functions. It will become more common
for support functions to be delivered by colleagues in other
countries, or external subcontractors. Many will be able to work
from home or hot desk at the office.
Malta has already begun to see the effects of this change,
with several international businesses choosing to base some of
their support functions in Malta. Competitive labour market
conditions, fluency in the English language, and increasingly
strong IT skills amongst the workforce have allowed several
local businesses to act as customer service, or technical support
contractors for international clients.
A second socio-economic driver of change is longevity
and ageing societies. Demographic trends, combined with
improvements in the quality of healthcare, will lead most
developed economies to face the realities of an ageing
population. The increased burden placed on social security
systems will exert pressure for the retirement age to be revised
upwards, broadening the pool of contributors towards pension

schemes while reducing the number of potential beneficiaries.
These demographic shifts will also see the introduction of new
products and services targeting this growing age cohort.
Malta is also expecting the proportion of its elderly to
increase. This will see growing demand for workers in the care
and medical sectors. It will also see additional pressures put onto
the working population to support a growing number of persons
dependent upon the national pension system. These changes
will drive the need for innovation, both in terms of products
targeted towards the elderly, and also in terms of financial
instruments targeted towards persons looking to prepare for
their own eventual retirement, and possibly invest in a private,
supplementary pension plan.
A third socio-economc driver of change is women’s economic
power and aspirations. Efforts to promote gender equality and
boost female participation rates have improved the educational
attainment and career prospects of women. This has resulted in
a greater degree of financial independence, and has unlocked
previously under-utilised human resources in several countries.
It is expected that women will continue to see growth in their
incomes, becoming an ever more important consumer group
prompting the development of products designed specifically to
cater for their needs and desires.
Malta currently still has one of the lowest rates of female
participation within the European Union. This situation is
evolving however: changes in societal values, and incentives
provided by the state (including free child care and ‘back to
work’ training) have seen the local female participation rate
increase significantly. Efforts to further encourage female
participation in the workplace will require employers to re-think
classical employment models and introduce additional family-
friendly measures, opportunities for burden sharing, and remote
working.
Drivers of Change – Technological

The first technological driver of change is mobile internet and
cloud technology. Advancements in internet technology have
enabled high-speed data transfer of large data-packets to both
traditional ‘desktop’ devices, as well as to small portable devices
such as laptops and smartphones. This has enabled the rise of
cloud technology, and the capabilities of a device is no longer
limited by its ability to process data, as this can now be done
remotely by specialised servers. Modern devices capable of taking
advantage of mobile internet technology can be built smaller,
lighter, and cheaper than ever, in part due to the rising influence
of cloud computing services. As such, most modern businesses
are able to run their IT operations without the need to invest
in expensive computer hardware thanks to the mushrooming of
cloud-based services.
The second technological driver of change is processing
power and big data. Most businesses sit on top of a mountain of
valuable data capable of offering valuable insights into customer
behaviour. Few businesses fully understand the value of this data,
and even fewer take active steps to analyse and exploit it. Those
organisations capable of using consumer data to improve their
strategy and product offerings have much to gain. The growing
availability of consumer data will bring about opportunities for
those willing to invest in processing power, tools and human
resources required to analyse data and provide advice based on
the results. As companies become aware of the wealth of data
at their disposal, and the value added it can bring when sifted
through intelligently, a raft of opportunities will open up for
business analysts, database administrators, data scientists and
big data engineers.
The third technological driver of change is advanced robotics
and autonomous transport. The use of machines and robotics
in manufacturing has been on the increase for several decades.
Modern technology promises to allow more flexible and
intelligent devices which would be capable of taking on a wider
array of tasks. Self-driving vehicles promise to revolutionise
transportation, while advancements in robotics technologies

would allow for more dexterous machines able to carry out a
broader range of complex tasks. Such advancements are likely
to bring increased efficiency to production and sale of goods.
However, they also present new challenges with regard to the
significant number of jobs currently carried out by humans
which they threaten to render obsolete.
The fourth technological sriver of change is artificial
intelligence (AI) and machine learning. While autonomous
vehicles and advanced robotics may be the way forward in so-
called ‘blue-collar’ workplaces, knowledge-based industries also
stand to be revolutionised by the advent of advanced learning
machines. Access to vast data libraries combined with high-speed
hardware has allowed for the creation of software capable of
rapid iterative evolution. This has ushered in the standardisation
and automation of many tasks, ranging from administration
to data analytics. While this may also pose a threat to a large
number of human occupations, it also promises to free up time
from repetitive tasks, which can then be re-focused on more
creative projects beyond the current capabilities of technology.
The fifth technological driver of change is advanced
manufacturing and 3D printing. Standardisation of parts pushed
manufacturing to a new level of efficiency as it allowed for specially
designed moulds, tools and machines to rapidly produce identical
goods. The advent of 3D printing may take things a step further
by reducing the need for such highly specialised equipment and
reduce costs of customisation substantially. A digital master file
may serve as a replacement to the traditional mould, allowing for
a single, programmable machine to potentially produce a wide
array of different products made from different materials. It may
also allow for design and production activities to be separated
and based in different locations optimised for each task. The
ability to manufacture goods on demand could see the future
emergence of business models whereby consumers are sold the
digital rights to manufacture goods themselves, as opposed to the
need to manufacture and transport goods directly to consumers.
This has ramifications for the traditional manufacturing industry,

as well as the transport and logistics industry.
The latter possibility presents opportunities for Malta.
Being an island nation with limited resources implies that
manufacturing activities would generally be required to import
any necessary raw materials, and then export finished goods,
incurring significant transportation overheads in the process.
Advancements in 3D printing may allow for product design work
to take place locally, and for the resulting designs to be sold in
digital format to end consumers, removing transport overhead
as factor when considering the nation’s competitiveness.
Talent Management and Employee Lifetime Value
The previous section of this chapter illustrates that the Maltese

economy is changing rapidly into an information and service
nexus where creating value is based on people, their intellect
and knowledge, and their willingness to invest this within their
organisation (Global Challenge Insight Report, 2016). In this
new environment, people, not physical assets or technology, are
the true creator of value within an organisation. As a result, a
large chunk of an organisation’s assets are related to intangible
capital tied up in knowledge and human talent.
These changes have a strong impact on organisations. If
organisations want to truly achieve success, then they must be
successful through their people. In order to do this, a paradigm
shift from more traditional human resources towards the
management of people (talent) specifically suited to today’s
dynamic competitive environment is required.
Defining Talent Management

Organisations have increased their investment in talent
management substantially. A study conducted by the CIPD in
2017 highlighted that over half of surveyed HR professionals
undertook talent management activities; however only 20% of
them operated with a formal definition of talent management.

As a result, talent management is sometimes viewed by senior
staff as a ‘cost’ rather than an ‘investment’, and initiatives are
reduced rather than managed.
Lewis and Heckman (2006) highlighted the three most
common ways that organisations look at talent and talent
management. First, there are those who simply substitute human
resource management with talent management. This mode of
viewing talent management is limiting to particular HR practices
such as recruitment, leadership development and succession
planning. Second, it is sometimes viewed from a manpower
perspective. This involves developing talent pools based on
staffing needs i.e. manpower requirements. Finally, others focus
on the management of people though identifying “A Performers”
and managing them upwards within the organisation, whilst
managing “C Players” out of the organisation.
Lewis and Heckman (2006) put forward a new mode of
viewing talent management which emphasises the identification
of key positions within an organisation that have the potential to
differentially impact its competitive advantage. The starting point
in this scenario is the identification of key positions rather than
talented individuals. This is then followed by the development of
a talent pool of high potentials and high performing incumbents
to fill these roles, and the creation of a customised Human
Resource Framework to facilitate filling these positions with
competent individuals and ensure their retention within the
organisation.
Utilising this conceptualisation of talent management,
suggests that organisations must first identify which internal
roles differentially contribute to its competitive advantage.
These may be considered to be ‘strategic’ jobs (Huselid, Beatty,
& Becker, 2005). However, these roles do not only include
senior management or leadership roles, but any role within
the organisation that impacts significantly on the achievement
of organisational objectives. Once these roles are identified,
organisations must ensure the development of a talent pool of
high potential and high performing incumbents to fill the roles

that differentially contribute to the organisation’s sustainable
competitive advantage.
The above views on talent management are linked by one
important factor: a strategic orientation. Many of the policies
and practices underlying talent management are synonymous
with various components of HR management (e.g. recruitment,
selection, compensation, performance management,
development, succession planning); however, talent management
additionally implies: a level of strategic integration (i.e. a set of
talent management activities that are integrated and aligned
with internal organisational systems and external environmental
factors), sophistication (i.e. the development of integrated
data management and information systems) and broad-based
accountability (for all managers and supervisors) that HR
management has traditionally not engendered (in practice if not
in theory).
Furthermore, these views also all maintain a sense of urgency
that is associated with the “war for talent”, a phrase first coined
in a 1998 research report by McKinsey Consultants (Chambers,
Foulon, Handfield-Jones, Hankin, & Michaels, 1998) which instils
a mind-set that human resources are the organisation’s most
important asset and primary source of competitive advantage
(Barney & Clark, 2007).
Given the impact of people on an organisation’s overall business
performance, it is critical for organisations to understand the
value of people over extended periods of time. This would allow
such organisations to make intelligent decisions about how to
invest in their employees in order to increase this value and extend
an employee’s life-time within an organisation (Josebachvili,
2016). This is known as employee life-time value (ELTV),
and can be enhanced through strategic talent management.
The inclusion of strategic talent management interventions
has a positive influence on the added value generated by the
employee. This concept also provides the perfect opportunity for
HR professionals to have a stronger role in their organisation’s
success. Through this model, HR professionals will work more

closely with finance managers to measure employee value. They
will become more data driven and proactive, and capable of
having a say in the strategy development of the organisation.
Rethinking Recruitment
Due to competition for talent and market share, and the increase
in skill intensive industries, attracting the right applicants at the
right time becomes more complex. Thus, the use of conventional
recruitment methods may no longer suffice to attract a sufficient
pool of qualified applicants in a timely manner.
Traditional recruitment methods focus on filling vacancies
(Armstrong, 2014). However, given all the changes impacting
organisations, the HR function must go further in order to
ensure it implements a more proactive and long-term strategy
to guarantee that it has the right people, with the right skills, in
the right place, at the right time (Bonneton, Schworm, Festing,
& Muratbekova-Touron, 2017). Organisations must re-visit
their recruitment strategies and ensure that they are attracting
and selecting talent through reputation management, employer
branding, and efficient recruitment and selection methods.
Organisations are urged to adopt talent acquisition strategies
that focus on five key elements (see Figure 1).
HR Planning
HR planning is to be used by organisations to gauge the people
and skills they require to achieve their business goals (Oseghale,
Mulyata, & Debrah, 2017). Under past conditions of relative
environmental certainty and stability, human resource planning
focused on the short term and was conducted with an “internal”
and people only focus. However, due to increasing environmental
instability, demographic shifts, changes in technology, and
heightened international competition are changing the need
for and the nature of human resource needs assessment and
Workforce planning
Developing an effective Building an employer

on-boarding programm brand
Selection of candidates Sourcing and recruiting

and leveraging job candidates
recruiting technology
Figure 1: Talent Acquisition Strategies.

Source: The authors.
planning. Thus, due to this shift, effective needs assessment and

planning must adopt both a short term and long-term focus while
also accounting for exogenous factors: such as the economic
outlook and forecasting for the industry. Organisations need to
adopt both a ‘people’ (internal) and ‘economic’ (external) mind-
set and outlook to be able to adopt a future-proofed and holistic
approach towards workforce planning. Armstrong (2014)
suggests utilising the following five, closely inter-related steps in
a workforce planning initiative:
• Scenario planning: assessing future environmental
factors and their likely impact on people requirements.
• Demand forecasting: estimating future needs for
people and competences by reference to corporate and
functional plans and forecasts of future activity levels.
• Supply forecasting: calculating the supply of people with
reference to an analysis of current resources and future
availability, after allowing for wastage. The forecast will
also take account of labour market trends relating to the
availability of skills and to demographics.
• Forecasting requirements: analysing demand and supply

forecasts with the help of models, to identify future
deficits or surpluses.
• Action planning: preparing plans to deal with forecast
deficits through various initiatives such as new policies,
changes to education systems and talent management
initiatives.
Building an Employer Brand

In light of the ever-increasing competition for talent, there has
been a strong shift from an employer’s market to an employee
market. For this reason, organisations have had to focus much
more on attracting potential talent. This can be achieved through
developing and promoting a strong employer brand (Theurer,
Tumasjan, Welpe, & Livens, 2018). This approach to recruitment
and retention “involves internally and externally promoting
a clear view of what makes a firm different and desirable as
an employer” (Lievens 2007, p. 51); it is seen as an effective
organisational strategy to differentiate from competitors and
gain a competitive advantage in the labour market (Martin &
Cerdin, 2014).
Employer branding describes the process of building an
employer identity and promoting a unique and attractive image
(Martin & Cerdin, 2014). Through this, organisations need
to apply marketing principles to manage their organisation’s
tangible and intangible employment offerings. Five initiatives
drive the creation of an employer brand: (1) identifying a unique
identity/brand and translating this into an employee value
proposition; (2) designing all talent acquisition content around
this identity; (3) ensuring employees champion this brand; (4)
understanding what competitors are doing and ensuring that the
organisation is offering something distinct and distinctive; and
(5) measuring and tracking key performance indicators.
This area of talent acquisition is one of the areas that Maltese
organisations have invested in heavily. Most local organisations
possess a careers page on their website or a separate careers
website that aims to highlight the organisations’ employer brand

and employee value proposition. Table 1 identifies some of these
sites.
Table 1: A random selection of career-related websites connected to
Malta based employers.
Company Career’s Page/Website
Vassallo Group https://www.lifeatvassallogroup.com/
PWC https://www.pwc.com/mt/en/careers.html
Casumo https://www.casumocareers.com/
Corinthia Group https://www.corinthia.com/en/about-us/careers
Sourcing and Recruiting Job Candidates

When sourcing and recruiting job candidates, organisations
must consider the primary purpose of the position, the financial
and operational reasons for creating or refilling a vacant position,
and whether the duties of the job could be absorbed by existing
employees (Sherrie, 2011). This will influence whether the
organisation recruits internally or externally. Normally, internal
recruitments are less expensive and more time effective. It can
also be easier for employees to succeed at a new job as they already
have workplace connections and knowledge of the corporate
culture. Internal recruitment is good for employee engagement
and retention as the organisation is clearly showing employees
that they can expect career progression and development within
the organisation. Succession planning initiatives can also be
deployed as part of an organisation’s internal recruitment drive.
This involves identifying and preparing suitable employees
to fill key positions when current employees either leave the
organisation or move into a different function.
Organisations normally use external recruitment to attract
individuals with the necessary skill sets that are not found in-
house or when seeking to grow the business or take it in a different
direction (Snell, 2016). There are three main types of external
job seekers; active job seekers (actively looking for information
about job openings), semi-passive job seekers (interested in a

new position but only occasionally look actively for one), and
passive job seekers (currently employed and not actively seeking
another job). Organisations should tailor their sourcing and
recruiting strategies to cater for these different types of job
seekers. As a rule of thumb, passive job seekers require more
active recruitment strategies (social media searches, internet
mining, algorithms, job boards, resume databases, networking
sites, employee referrals, employment agencies), whilst active job
seekers require more passive recruitment strategies (promotion
through the organisation’s career page, job posting and social
media advertising).
Traditional job postings, a passive recruitment strategy, used
to be seen as the main way of sourcing and attracting talent.
However, research and practice suggest that the most successful
mode of sourcing top talent is through employee referrals and
internship programs (e.g. Snell, 2016; Bonneton et al., 2017;
Theurer et al., 2018).
Reliance on social media recruiting is also growing, in
particular for recruiting passive job candidates. This recruitment
strategy is also an easy and fast way to increase employer brand
awareness and recognition.
There has also been an increase in the use of third parties
for sourcing and recruiting job candidates for roles that are
hard to fill (Armstrong, 2014). These third parties – normally
recruitment agencies and executive search head-hunters –
approach their own contacts within the industry or tap into
their database of potential candidates for a role. As of January
2019, the department of industrial and employment relations
in Malta listed 96 registered employment agencies. These
agencies work within the sourcing and recruiting consulting
industry.
Selection and Leveraging Recruiting Technology
Once an organisation has a short-list of potential candidates

for a role, selection comes into play. The purpose of selection
is to assess the suitability of candidates through predicting
their performance within the role. It involves deciding on the
degree to which the profile of the candidate (i.e. competencies,
experience, qualifications, education and training) matches the
job requirements. The most common methods utilised, often
concurrently, in the selection process are: application forms,
interviews, references, assessment centres and selection tests
(Taylor, 2008).
1. Application forms
An application form is a standardised means to collect candidate
information and draw up a short-list for interviews. Pioro and
Baum (2005) suggest that, in order to make the best use of
application forms in the selection process, organisations should
decide their selection criteria and how these will be assessed by
use of the application form in advance. They should also keep
their questions clear, relevant and non-discriminatory; and ask
for only the bare minimum of personal details.
2. Interviews
Generally, the nature of the job and how much time an
organisation can afford to allot to the interview process will
determine how many applicants get chosen for interviews
(Taylor, 2008). Put simply, an interview is a verbal test for the
candidate. However, there is no clear right or wrong answer to
the questions asked, as the answers given by the candidate are
subject to interpretation by the interviewer (thus leading to high
levels of subjectivity).
An interview is meant to find out how specific individuals are
expected to behave on the job. Thus, successful interviewing is
built on a thorough understanding of the job requirements. In
order to do this, the questions asked in an interview should be

based on a complete and accurate job description that identifies
the critical job competencies. These competencies become the
target list against which each candidate is measured.
The most widely used interview techniques are the structured,
the non-directive, and the situational/problem-solving interview
(Oseghale, Mulyata, & Debrah, 2017). A structured interview
involves a pre-set list of questions that are asked to all candidates.
Utilising the same questions for all candidates ensures that all are
assessed by the same standards. It is implicit that questions are
based on a thorough understanding of the job/role requirements.
The other form of interview type is situational interviewing.
This mode of interviewing is characterised by open-ended
questions that assess what the candidate would do or has done in
specific situations (Armstrong, 2014). This allows the candidate
to speculate on how they would handle a particular job problem.
The candidate would be expected to give specific examples of
past actions and results, when asked about how they handled
specific past situations. This is based on the principle that past
behaviour is a good predictor of future behaviour.
Non-directive interviewing takes the opposite approach of
structured interviews. This comprises open-ended questions
that are not normally planned in advance. Examples of such
questions include; “tell me about the work you do in your field,”
allowing the candidate to express his or her thoughts and feelings
that might be relevant to the job and allowing the interviewer
to follow the direction set by the candidate. Whilst these
interviews may reveal information that may never arise through
structured interviews, organisations must proceed with caution
when making selection decisions based on these interviews.
Interviews without structure may focus solely on getting to
know the candidate, rather than predicting future performance
within the role.
3. References
References are used in order to validate and confirm the
information given by a candidate. It involves confirming the
nature of the candidate’s previous job, the period of time in
employment, the reason for leaving (if relevant), and the salary
(Armstrong, 2014). In some instances, organisations request
character, competence, performance and suitability references.
However these include a high level of subjectivity and potential
bias.
Whilst the above are quite popular methods of selecting
candidates, organisations should also consider the use of selection
tests and assessment centres in their selection processes.
4. Assessment centres
Assessment centres assemble a group of candidates and use a
range of assessment techniques over a concentrated period (one
or two days) with the aim of providing a more comprehensive
and balanced view of the suitability of individual members of
the group. A well-structured and planned assessment centre will
give organisations the opportunity to observe actual behaviour in
work-related situations. The main characteristics of assessment
centres include: exercises directed as capturing and simulating
the key dimensions of the job (such as; one-to-one role-plays and
group exercises); measuring performance in several dimensions
in terms of the competencies required; and assessing candidates
together to allow for interaction and to make the experience
more open and participative. Using several trained assessors or
observers increases the objectivity of assessments.
Assessment centres also provide the opportunity for
organisations to gauge whether a candidate matches the culture
of their organisation, and the candidate to discover whether they
like the values and culture of the organisation. It is important to
note that assessment centres are expensive and time-consuming
and their use tends to be restricted to large organisations for
managerial positions or for graduates.
5. Selection tests
Selection tests provide valid and reliable evidence of levels of
abilities, intelligence, personality characteristics, aptitudes and
attainments (Armstrong, 2014). They typically supplement the
information obtained from an interview.
There are two main types of selection tests. Those that
measure typical performance, such as personality inventories,
and those that measure maximum performance i.e. measures
that assess how well people can do things, how much they know
and the level of their ability (these assessments focus on what
people are capable of knowing or doing (ability tests) or what
they actually know or can do (aptitude or attainment tests))
(Armstrong, 2014).
When choosing which selection method or methods to
adopt, their predictive validity is critical. Research suggests that
intelligence tests (cognitive ability tests) and structured situational
interviews are the best predictors of future performance.
As the demand for talented employees increases, the
demand on the individuals responsible for recruitment within
an organisation increases as well. These individuals are faced
with extreme pressures to manage large volumes of recruitment
mandates in short timeframes. Organisations should support
and enhance their recruitment process through automation
tools that can source candidates, schedule interviews, screen
applicants and conduct background checks.
Organisations would do well to invest in applicant tracker
systems that have more intuitive user interfaces, improved
candidate experiences, high-tech social recruiting, increased
automation and integration capability. For organisations facing
a competitive job market where too many irrelevant applicants
are coming forward, using algorithms can prove useful as they
can aid the identification of the right talent, remove a level of
human error and reduce the risk of recruiters missing qualified
candidates. However, organisations must act with caution
and use algorithms to inform but not take hiring decisions:
algorithms may create biases in filtering processes.
Induction: Developing an Effective On-Boarding Programme

Traditionally, organisations have treated on-boarding as a single
event rather than a process (Armstrong, 2014). Through these
processes new recruits attend a one or two day orientation
programme. This is a passive process where they receive
information about policies and procedures, and are introduced
to the rest of the organisation. Such on-boarding processes do
not truly ensure that employees integrate with the organisational
culture and are truly supported in settling into the organisation.
Employees who are not on-boarded properly have a higher
tendency to leave the organisation within 3-6 months. The
early stages of on-boarding are crucial towards establishing a
lasting bond between employees and the organisation. Thus,
effective on-boarding is key to effective retention (Snell, 2016).
Bradt & Vonnegut (2009) describe how a full on-boarding
programme can dramatically improve the performance, fit, and
readiness for the job of every employee who takes on a new
role within an organisation (be it through internal or external
recruitment). Effective on-boarding will assist in building,
sustaining and supporting the creation of high-performing
teams. On-boarding initiatives also support the organisation
in shaping its culture and sustaining a competitive advantage.
On-boarding can be seen as a process involving: (1) acquisition:
the identification, recruitment and selection of talent; (2)
accommodation: giving the new recruits the tools and resources
required to do their job properly; (3) assimilation: teaming up
the new recruits with other employees so that they can work
together; and (4) acceleration: supporting the new recruits in
achieving enhanced performance faster.
Organisations are smart to think of on-boarding from a long-
term and strategic perspective. On-boarding does not commence
on a new recruit’s first day on the job. It is something that must
fit into the whole acquisition process: true on-boarding begins
through ensuring that the organisation agrees on the need for a
new team member and the description of the role that needs to
be filled. The organisation must then ensure that this information
is relayed during all aspects of the acquisition process. This

will ensure that: (1) recruiting, hiring, and assimilation time
is shortened; (2) hiring mistakes are reduced by ensuring that
everyone, including potential hires, are fully aware of what the
job requires and what the organisation can offer the employee;
(3) new employee “buyer’s remorse” (regret at choosing to accept
the new position/role) is reduced; and (4) new employees are
aligned with key business strategies (Bradt & Vonnegut, 2009).
Conclusion
Organisations need to mainstream talent as a strategic priority.

Today, an organisation cannot expect to survive and thrive unless
it creates and sustains an environment where it has a strong talent
pool that is willing to invest in, create value for, and commit to the
organisation. To do this, the organisation must also create value
for its employees. Hence the focus on strategic talent management
in order to ensure that the organisation is capable of building a
sustainable future through, but also for, its people.
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Performance Management:
Processes and Practices
Caroline Buhagiar Klass
This chapter zooms on performance management at work. This

widely used process has become key to the way organisations
measure employees’ output. It encompasses different steps, each
one contributing to different aspects of business and employee
growth. This is followed by a detailed description of the different
parts of performance management and how these are applied
in practice. The application of performance management and
some of its pros and cons in today’s working environment is
also discussed. Next is a review of performance management
information systems and their use in today’s business context. This
chapter focuses throughout on the application of performance
management in the Maltese working environment, drawing also
on research and practices coming from the south of Italy due to
its proximity, influence on local cultures and similarities in our
ways of working and lifestyle.
Performance Management
Performance management has been around since the 1960s

when the concept of competitiveness and time to market
started to emerge in the management literature (e.g. Anthony,
1965). Companies used performance management to measure
employee productivity and to analyse how they can improve so
that they could beat their competitors. Since then, performance
management has gone through significant changes where the
custody of such a practice (and now a significant process) lies
in the hands of the human resources (HR) function. In most
medium to large companies, performance management is a
complex mechanism which entails goal setting, ongoing reviews
and feedback to improve performance and the implementation
of development plans that are ultimately linked to rewards.
This system was introduced in Malta in both the public and
private sectors in the 1990s. The aim was to assess the output
of employees against set standards. The objective was also to
strengthen the relationship between employees and their line
managers to ensure that all individual employees understood
what was expected from them. Performance management is
a process that seeks to create an environment where the raw
potential of employees is transformed into great performance.
Today, many organisations in Malta have some form of
performance management system in place. The major challenge
that many local HR professionals face involves the shift in
mindset, whereby they start accepting ownership for employee
performance, and not delegate such a task exclusively to the HR
department. This process introduced the aspect of providing
feedback on performance to employees that was seen as credible
and fair. HR professionals highlight that one of the issues they
face is the lack of capability of their management teams to assess
properly the performance of their teams, mainly because little
training is provided when people move into managerial roles.
Moreover, the HR function itself has its own capability gaps to
address when it comes to performance management.
Performance Management 55
In many organisations, performance management is still

seen as something that HR does when there is a problem.
Another factor that impacts on the effectiveness of performance
management in Malta is an ‘island culture’ where at times who you
know takes over what you know (Trompenaars, 1997). The small
size of the country, with its 200,000 strong workforce, cannot
avoid the challenge of familiarity. It is common to find whole
family members or neighbours working in the same organisation
or even within the same department. Thus, familiarity creates
a challenge when managers need to assess someone who is
well known to them in their private life (Baldacchino, 1997).
Providing feedback on poor performance to someone who is very
familiar adds pressure on the line manager. Local organisations
highlight this issue as one of the factors that at times impedes the
effectiveness of the process.
As mentioned earlier, performance management sets out to
differentiate employee performance. Managers need to ensure
that recognition is given to the right employee who has shown
exceptional results and proper behaviour. Each individual is
unique and has different capabilities, therefore it is unfair to
give the same recognition to different employees. Performance
management works well when the culture of the organisation
values diversity of thought and recognizes that each individual
brings different strengths and capabilities to the work place
(Carrel, Elbert, & Hatfield, 1995; Fernandez, 1991). Providing
the same exact rewards where jobs are similar, especially in
the professional services, will defeat the whole purpose of
performance management. The key here is that organisations
create a culture of continuous improvement with respect to
performance. Growth happens on two levels: the individual
and the business. One is not to be sacrificed at the expense of
another. If business is doing well generally, this is also due to
the employees that are contributing to the overall results; and
the opposite applies as well. During different discussions in
local fora and seminars, HR leaders have outlined some tips that
will help local organisations to implement and drive successful
performance management processes. What follows are some

guidelines to help employees and managers drive an effective
performance management system.
Guidelines: Six Steps
The process of performance management starts when an

employee joins an organisation and finishes when the employee
resigns or retires. This process is the foundation of business
performance. One can look at it as a framework which drives
superior performance because it allows organisations to define
what they are doing well and what needs to be improved. The
process is an integrated approach that defines what success
looks like and what capabilities are needed by the organisation
to achieve success (Armstrong and Baron, 1984). From a local
perspective, performance management is in many cases seen as
an additional task on top of the day-to-day work of a ‘manager’.
Local managers share a tacit understanding that this is something
that their firm’s Human Resources department should and must
manage. There needs to be a mindset shift in our local working
practices; managers are responsible for the performance of their
teams. That is why they are called managers and that is what is
normally written in their job descriptions as part of their day to
day responsibilities.
At least six steps encompass the process of performance
management. One is linked to the other, so if one step is missed,
a dysfunction in the whole process of performance management
framework is created.
Writing clear job descriptions, which explain the role and
responsibilities of the incumbent, is an important first step.
This defines the critical skills required by the role and the
expected outcomes and behaviours that the employee needs to
demonstrate. An important aspect in this area is that companies
must ensure that the right person is chosen during the selection
process. The candidate needs to fit the requirements of the role
and not the other way around. Various conversations with local
companies suggest that compromising is common and the job
description starts to take shape to accommodate the person
that has been referred to by someone we know or someone
who has approached us to highly consider a person that needs
a job. There is nothing wrong with referrals and creating a good
network, however this should not jeopardise the selection of the
right and rightful candidate. In a small island society, as is ours,
it is quite common that relationships have a significant influence
on the selection of candidates for a particular role, or for the
outright creation of specific vacancies to accommodate distinct
candidates (Bennell and Oxenham, 1983). Many admit that
such a practice creates problems in the future where the initial
requirements of the role cannot be achieved because the person
chosen never had the requisite skill set in the first place.
The second step is to define clear outcomes, both tangible
and intangible. Objective setting is about planning what you
need to achieve, and how and when to achieve it (White, 1995).
Objectives should be regularly reviewed throughout the year
and may change to reflect developments within the business,
the individual roles or working patterns, policies or regulations.
Managers should discuss and agree with objectives, and record
them in an HR information system (HRIS). Objective setting is
key to the overall strategy of an organisation. Each objective has
to be linked to the strategy of the company; otherwise, employees
may be working very hard but going in different directions; they
would end up exhausted but ineffective.
Another key element in objective setting is defining the
intangibles. Managers often share their difficulties when trying
to write objectives that are related to behaviours or attitudes at
work. This step requires strong capabilities from the managers
that rely on good strategic thinking and a translation of that
strategy into individual goals. One way to support the definition
of intangible objectives is to use the ‘values and behaviours’
normally defined by many organisations today. In most local
organisations, however, this is rarely referred to; or, if it is, it is
done in a way that it cannot be measured at the end of the year.

The starting point here should be that managers identify three to
four behaviours and explain to the employee that they need to
see these demonstrated as part of their day to day performance,
providing some examples to help the employee understand
these expectations. When setting objectives, managers need
to consider how these will directly contribute to achieving the
organisation’s strategy.
Once the objectives are set, another important step kicks in:
development and capabilities planning. The manager and the
employee define together the skills, knowledge and behaviours that
the employee needs to work on, so that they achieve those objectives
and preferably over achieve. The intent here is to allow the employees
to increase their capabilities which will contribute to career growth.
This discussion is normally split into two areas. The first is related
to the capabilities that are needed now; and the second is related to
the capabilities that are needed in the longer term and linked to the
career ambitions and aspirations of the individual employee. This
latter discussion is normally linked to another two components of
the performance management process: talent management and
succession planning (Berger and Berger, 2011).
Continuous improvement and people development is a
characteristic of high-performing organisations. Ongoing review
of the objectives and development plans with employees needs
to happen consistently and frequently. One to one meetings
between the manager and the individual assess progress and
identify the challenges encountered by the employee that may
require additional support from their manager. A manager
needs to identify good performance and provide recognition
to the employee. These ongoing discussions are critical and
every manager needs to be equipped with skills to hold effective
conversations with their employees. Many performance
problems boil down to the fact that these important reviews and
feedback sessions rarely happen, or break down into accusation
and acrimony, resulting in poor performance, demotivation and
disengagement.
The sixth and final step in the process is rewards. Once

performance is reviewed and the employee has achieved all
objectives and demonstrated the right values and behaviours,
managers need to ensure that their people are rewarded in a
fair and meritocratic manner. If employees do not achieve their
objectives or demonstrate the wrong behaviours and attitude
over time, there need to be conversations of how improvement
will be achieved. If there is no improvement, other actions may
follow; these can result into a transfer to another role, reprimand
or dismissal.
The objective of performance management is to provide
employees with the right capabilities that will create commitment
and engagement aimed at creating meaning and purpose for
performing a specific role in the organisation (Lockett, 1992).
Performance management is a process that strives for a ‘high
performance culture’ within the organisation. Both the individual
and the teams take responsibility to contribute towards great
business performance. The concept behind this is that every
employee is accountable for the success or failure of their
business performance. In a context like Malta, employment law is
complex and it often favours the employee over the organisation.
This means that, in some cases, it can take up to three years to
fire an employee who under-performs. This brings with it many
challenges for the organisation which has to carry the expense
of under performance; while colleagues have to make up for the
absence of those who do not achieve the performance required.
More often than not, those employees who are doing a good job
end up the worst. Most under performance issues end up in front
of industrial tribunals or local courts, which can be a lengthy and
costly process of litigation. Throughout this process, employers
must pay employees their full salary, which goes against the
concept of meritocracy and fair assessment of performance.
Such practices impact on the employability, profitability and
sustainability of the business.
In a context like Malta, introducing concepts like talent
management and succession planning are important outcomes of
performance management. These aspects will help the employee

gain skills and competencies that will fulfil their potential and
bring organisational success with individual growth. Succession
Planning is the practice of identifying critical positions within
the company, identifying the capabilities and experience
required to be successful in those positions and then identifying
potential successors. Today we are seeing a surge in demand for
high profile jobs which, more often than not, require companies
scouting and sourcing talent from abroad due to the lack of
local supply. On one hand, it is great to have diverse teams and
diversity of thought, however, we must ensure that those expert
skills are passed on to the local workforce so that we continue
nurturing our competencies as well. We cannot rely solely on
imported talent; we need to make sure we build our own talent
as well. This practice helps de-risk critical positions and enables
the organisation to develop employees who have the potential,
aspiration and capability to perform these roles in the future.
Succession plans are especially needed for critical positions
which, compared to other positions at the same level, are
strategically important and/or high risk. Those positons require
a critical capability or skill for which there is a limited market
supply internally and externally. These include positions which
are expected to grow in scope and importance in the future and
those that are required by law: those involving engineering,
logistics, legal counsel, accounting and auditing.
Time and resources are required to drive a proper succession
planning exercise. If the identified employees in the succession
plan are not prepared or equipped with the necessary skills, then
the organisation needs to invest to develop these individuals.
There needs to be a more structured approach in the way we
train our workforce locally. It needs to be fully embedded in the
ways of working and managing our businesses. More importance
needs to be given to personal, so-called ‘soft’ skills, such as
projection, negotiation, communication and assertiveness. The
ability to project oneself with confidence and communicate
clearly within a professional context is just as important as the
technical expertise. Interpersonal skills need to be harnessed

as these will define the opportunities of employees within any
organisation.
Succession planning also provides employees with career
opportunities and personal growth and can be the subject
of a discussion that falls within the development planning
component of performance management. Individuals can
discuss their aspirations and dreams within the organisation
wit their manager. Factors to review during these types of
discussions include (1) individual employee’s aspirations, skills,
capability, experience and mobility to meet the requirements
of the new position, together with (2) the potential individual’s
readiness for the new role; and (3) current and past performance
and behaviour ratings, in order to ensure that the individual has
the right track record and attitude.
Implementing an effective performance management system
A good performance management system requires careful

planning and thought. This starts with a conversation between
the employee and the manager to define targets for the year.
The targets need to reflect the business strategy that is normally
set by the senior leadership team of the organisation and then
is communicated down to the rank and file. Each department
then defines its goals for the year and in turn each manager sits
down with their employees to define individual objectives for
that year. Objective setting is crucial because, if not done well,
it becomes a challenge later on in the year. Objectives have to
be clearly set and they need to be measurable so that at the end
of the review period, there is an objective discussion of whether
the targets were met or not. Many organisations have also a set
of values and behaviours that their employees are expected to
demonstrate during their tenure. These behaviours are normally
defined and included in the objective scorecard, which are then
discussed during the year.
Ongoing discussions and feedback are key to effective

performance management (Diener, McGee, & Miguel, 2009).
Indeed, it is a crucial skill that each manager needs to master if
organisations aim to have high performing employees. During
these conversations, the employee and the manager review
where they are vis-a-vis the objectives and how the employee
is driving their performance from a values and behavioural
perspective. Many companies include development plans as part
of their performance management system. These plans have two
main aims. First, to define the skills and behavioural sets that the
employee may need to learn in order to achieve the objectives
for that year; and, second, to discuss the medium to long term
aspirations of the employee, so that specific skills and abilities
are listed and followed up by actions to allow the employee to
gain these skills and abilities in preparation for the next role. This
exercise is vital to ensure employees are clear about their future.
During the performance review discussions, managers need
to highlight strengths and areas to improve. On the other hand,
the employee needs to discuss their ambitions and challenges
so that these are addressed and a way forward is agreed. These
discussions are also recorded in the HR System or some other
form of platform. Locally, we have seen challenges where the
process is captured on paper and it becomes laborious and
lengthy to complete. Companies need to invest in an automated
system so that it facilitates the process and it is easy to follow
up both for the employees and the organisation itself. It is an
investment that will pay off because it provides good insight
into the performance of the organisation. Normally, a mid-year
review and end-of-year review are planned between manager
and employee. Some companies encourage their managers and
employees to have ongoing monthly review sessions. Having
frequent performance discussions helps keep performance
on track and avoids surprises at the end of the year when a
performance rating is given.
An important component of performance review is
performance improvement plans (PIPs). These seek to address
under performance issues which can be related to inefficiencies

or deviant behaviour that are not aligned with organisational
values (Rummler & Brache, 1995). Discussing a PIP with an
employee can be a challenge, especially when the employee does
not accept the feedback, is cynical of the organisational ethos, or
does not agree that improvement is needed. The manager needs
to provide objective data and facts during this conversation. Such
instances in our local context end up in a tribunal or become
an internal dispute. In most cases, the root cause of the issues
can be traced to a lack of clear and consistent communication
between employee and manager. Providing fact-based evidence
in these situations is critical and therefore the implementation of
an automated system to capture performance reviews is key to
the overall success of the process.
The next phase of performance management is rewarding
good performance. This is normally done in different forms
and at different stages. During the annual cycle, managers need
to recognize their employees for achieving specific results or
demonstrating great behaviour. Most companies have various
recognition schemes, awards ceremonies and specific tokens
or initiatives to reward good performance. When employees
achieve good or excellent performance a set of sub steps are
triggered. Employees who are rated as top or strong performers
get higher rewards. These come in the form of higher variable
pay, share schemes and development opportunities that
companies provide for their top talent. The variable pay is mostly
discretionary and is linked to the financial health of the business
and the individual’s performance. Top performers are normally
put on a talent path which links their career progression with
specific talent programs and initiatives. Many organisations
provide ‘potential ratings’. These ratings are linked to succession
planning. This is an annual exercise which identifies individuals
that are selected as future leaders within the organisation. To
date, in Malta few companies drive the recognition process in
line with succession planning. This is mainly due to the lack of
evidence-based data that is needed during this process.
Moreover, the concept of variable pay is at times mismanaged.

There is an expectation that, if an employee has worked hard,
there is an automatic fixed pay increase. Fixed pay is not related
to the annual performance cycle. Fixed pay is linked to the job
scope and responsibilities in line with the local salary market
index and standard of living. Performance fluctuates and is
dynamic. Therefore, to address different levels of performance,
companies use discretionary variable pay to recognise different
levels of performance. This rationale is not yet fully embedded
in most organisations locally or, at best, it is not as effective as it
should be.
The pros and cons of a performance management system
Significant research has been conducted on performance

management, providing mixed reviews about its effectiveness
(Allan, 2010). Performance management, when applied properly,
can be beneficial both to the organisation and the employees.
The system provides an objective view on the performance of
individuals where managers reward good performance and
highlight poor performance. It aligns the aspirations of employees
with the strategy of the organisation, as long as performance
discussions happen regularly and are conducted in a constructive
manner. Performance driven organisations implement this
process with the aim of providing a vision that will form the basis
of their departmental goals. Performance management works
well when targets are clearly set. Some of the challenges start
when objectives are vaguely set and cascaded to the individual.
At the end of the year, it will be difficult to measure whether
these objectives were met or not. Targets related to behaviours
are at times difficult to formulate on a score card and discussions
become a ping pong conversation between the manager and the
employee that may have differing views on the matter.
The difficulty that some companies raise with the
performance management process is that it lacks consistency
during execution because of an insufficiently competent

and capable line management. If and when implemented
poorly, performance management can lead to poor output,
employee disengagement, lack of transparency and employee
grievances.
An important aspect in performance management is the
ability to give and ask for feedback from multiple stakeholders
in the organisation. Many companies admit that their line
managers find the process of providing feedback difficult,
especially when it entails giving tough feedback (Allan, 2010).
To address the latter challenge companies have introduced 360
degrees feedback. This entails having multiple ‘raters’ providing
feedback to reduce a bias that may be critical if feedback is
coming from one person only. 360 degrees feedback has been
found effective and insightful, shedding new and fresh light on
the performance of employees. This process is normally done
through a sophisticated method using psychometric tests on an
online system.
The process of 360 degree feedback requires the identification
of multiple stakeholders for an employee; they can be invited
to an online system to give feedback on different aspects of
the employee’s performance, including skills, abilities and
behaviour at work. This process is also used to develop leaders
in organisations and managers can be asked to go through a 360
degree assessment as part of their development plan. Nowadays,
this tool has become popular in many global organisations and
it is implemented for different levels of employees, and not
only for those in leadership positions. The employee is asked to
rate themselves first, then their manager, peers and customers/
vendors are invited to provide their additional feedback. The
outcome of this exercise is a snapshot of scores on different
traits and abilities normally plotted on a grid. This grid normally
demonstrates whether there is alignment between scores and
highlights any gaps that the employee may need to work on. 360
degrees feedback has helped to minimise bias on the process
of performance management. However, managers have the
ultimate responsibility to drive the process effectively. They need

to ensure proper follow up and maintain proper documentation
so that it is shared with their employees. As previously
mentioned, in our local work context, managers may feel that
this is an HR responsibility and the process ends up in neglect
triggering different people issues. The HR department may
indeed be the custodian of the process but that does not mean
that it owns it. The responsibility of employee performance relies
on the line manager and the employee because they have clear
visibility of the day-to-day and not HR. This can causefriction
in organisations because it demonstrates the maturity level of
the HR function within the organisation. HR professionals need
to coach and support the line managers so that the process is
effective and efficient.
Finally, HR must ensure that line managers are equipped with
the proper skills to manage the process and are able to provide
effective feedback to their employees.
Performance Management Systems: Four Tips
Performance management software helps the organisation

to create an efficient process. Trying to manage performance
management without proper automation could prove daunting.
Automation in performance management is key: trying to
do this manually can result in a cumbersome and ineffective
process. Many systems are available and the choice will depend
on the size and scope of performance management within the
organisation.
Some of the systems one finds on the market come as a stand-
alone product; others come as part of an HRIS package which
would incorporate the whole life cycle of an employee. The best
performance management systems are those that score high on
the customer index. There are various websites today that gather
data constantly to determine which is the best software or which
system is ranking the highest. Here are four tips to guide what to
look out for when choosing performance management software:

First, ensure that the system can reflect the structure and
processes of the organisation for which it is intended. This is
crucial because one does not buy a system and then spend many
months customizing it to fit a particular company profile. This is
a mistake that many have done and the result is a hefty bill at the
end of the implementation phase.
Second, make sure that the system is user-friendly and
intuitive. This will enable employees to use the system easily and
confidently, with minimal training. Choosing a system that few
can handle is another no-go advice.
Third is to assure that the chosen system can generate
reports and people insights: here is where HR expertise is
crucial. In medium to large organisations, generating reports is
a key function which allows the business to look at its data and
make those decisions or changes needed to increase or improve
performance. A system that does not have the possibility to
provide strong insights and analytics is a waste of time. The
software needs to allow the organisation to retrieve standard
information (such as workforce data) and subject this to more
sophisticated analytics (like talent pipelines and succession
plans) which are an output of performance management.
Without proper performance data, it will be hard to quantify
what has been achieved or missed. The organisation needs people
insights because these will have an impact on their pay increases
and on their career aspirations which are key motivating factors
(Herzberg, 1959/2017).
Fourth, is concern with data security. Hosting sensitive
personal data brings a whole new regulation in place with
respect to data protection. Choosing a reputable company that
is ISO 27001 certified can provide the needed confidence level,
ensuring it is aligned with the law. When data is hosted on a
cloud platform, it is important to know who is hosting the data
and where are they based: if domiciled in certain ill-reputed
jurisdictions, you may expect a rough ride if obliged to take legal
action.
During the ‘request for proposal’ (RFP) process, all

stakeholders should be involved and the decision on which
system is chosen needs to consider the needs of the organisation
that will provide the outcomes established at the beginning of
the journey.
Employees making the best of performance management
Development planning is the opportunity to consider strengths,

opportunities for further development and to take action:
reviewing what was discussed so far during the year as part of
the regular performance and development conversations. When
preparing for a development discussion, consider the following
battery of seven questions: (1) Where am I now in terms of
career development and aspirations?; (2) What are my strengths
and developmental areas? (consider asking for feedback from
colleagues to help your thinking); (3) What are my most recent
performance objectives and what kind of feedback has been
received to date?; (4) What are my existing development plans
and progress?; (5) Where do I want to be and how do I get there?;
(6) what are my immediate development aims (short term); and
(7) what are my career aspirations (long term)?
When writing a development plan, less is more. Aim for
one to three goals per timeframe i.e. short term and long term
(six maximum). Focus on manageable goals to improve your
performance. Consider how to measure your success. The best
development happens through new experiences. Make sure
your development actions are realistic, based on your personal
situation and the resources available. Stretch yourself. Set goals
that build on your strengths as well as improvement areas. For
example, think about how you could build your existing skills
through a new or more challenging situation. The difference
between short-term and long-term development is simple:
short term actions will help you achieve your current objectives
while long term actions will be linked to your career aspirations
one to three years down the line. Consider the following nine
questions: (1) How do you make the greatest impact?; (2) What
are the strengths that help you to do this?; (3) What inspires and
motivates you, and why?; (4) What are your personal goals?;
(5) What do you aspire to learn/do within your career?; (6)
How can you progress in your current role?; (7) Describe the
characteristics of the role you would like to have in one to three
years?; (8) How does this compare to your manager’s view of
your natural progression route?; and (9) What skills, knowledge,
capabilities and experiences do you need to develop to ensure
that you are preparing properly for your future aspirational roles?
Creating maximum benefit for all stakeholders
The best development happens when learning from new

experiences is supported by active manager involvement. This
is typically ‘on-the-job’ but may also be outside of work (e.g.
community-based activities). This should be supported with
learning from others: typically through coaching or mentoring.
Formal learning (e.g. academic programs of study) may also
be appropriate for some development areas. At times, the
most common development action is a list of formal training
programs which may be good but will not be sufficient.
Learning and development in organisations happens in different
ways and needs different interventions. Managers must help
employees reflect on achievements, strengths and development
areas. Cover short- and long-term development. Short-term
discussions should focus on role requirements and objectives.
Long-term discussions should focus on building skills/
experience to achieve career and future business goals. Adapt
your conversation to the individual. For employees who have
performance (and behaviour) improvement areas, focus more
on short-term development, which can be sustained over time.
For employees who are on track to achieve their goals, focus
on long-term development and career aspirations. Managers
should use this opportunity to listen, ask for feedback and find
out what support the employee needs from them. Helping their
employees focus on taking action. The discussion and their
development plan will not help increase performance unless
there are actions that are locked into clear timelines. Managers
should reflect on the effectiveness of the actions taken. Did the
activity meet the development need? What learning points is
the employee applying day-to-day? What are the employee’s
next steps? An organisation has a lot of responsibility, especially
in a small country like Malta. It needs to create a compelling
story that will benefit their customers, employees, shareholders
and the community in which they operate. Only when all of the
stakeholders’ interests are considered can any business flourish
and grow. Performance management is a process that enables
long-term sustainability through fact-based management.
Conclusion
This chapter has reviewed the life cycle of performance

management. The process aims at creating a dynamic culture
of high performance and driving more coaching conversations
between managers and employees, for both evaluative and
developmental purposes. Many managers admit that they have
many conversations with their employees; however, many of those
who manage people know that a lot of work and preparation is
required to ensure that such conversations translate into great
people performance. Managing people can be one of the most
rewarding roles that exist in organisations today. Having the ability
to support employees grow and fulfil their potential provides a
great sense of achievement. Being able to contribute to the success
of others is something that many aspire to while managing people.
Great leaders are not afraid that their employees outperform
them, but thrive on the fact that they somehow contributed to the
growth of their peers and subordinates.
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Motivation, commitment
and control
Gottfried Catania
Work motivation has been defined as “a set of energetic forces

that originate both within as well as beyond an individual’s
being, to initiate work-related behaviour and to determine its
form, direction, intensity, and duration” (Pinder, 1998, p. 11).
Motivating workers is essential for the healthy functioning of
an organisation, with a large number of research studies linking
worker motivation with increased engagement, performance
and organisational citizenship behaviour (e.g. Cerasoli, Nicklin,
& Ford, 2014; Christian, Garza, & Slaughter, 2011; Dalal,
2005; Halbesleben, 2010). Most definitions of organisational
commitment reflect three general themes: (1) an affective
attachment to the organisation; (2) a perception of the costs
associated with leaving the organisation; and (3) a sense of
obligation to remain in and with the organisation (Meyer &
Allen, 1991). These components have been called the affective,
continuance and normative components respectively (Dunham,
Grube, & Castañeda, 1994). Control refers to the perceived sense
of empowerment that workers, in particular managers, have
over various aspects of the decision making process (Parker &
Price, 1994).
This chapter opens by highlighting key features of the current

Malta labour market. It will then summarise some of the main
theories of motivation, introducing their core concepts and main
criticisms. These theories will be applied to the Maltese situation,
currently exhibiting various positive indicators, including:
the largest number of employed persons ever, a very low
unemployment rate, and rising female employment (NSO, 2018).
Possible effects of the current local context on organisational
engagement, loyalty and commitment are considered next. The
conclusion will review some of the limitations arising from the
research presented in this chapter.
The Current Maltese Labour Market
The latest quarterly labour survey published by the National

Statistics Office paints a very rosy picture of the labour market
in the Maltese Islands in 2018. The number of employed persons
in the first quarter, at 217,259, accounts for more than half of
the population aged 15 and over, and represents the highest
number of employed persons on the islands since records
began. The unemployment rate, at 2.5%, is also one of the lowest
ever recorded and hints at the full employment situation in
the country. Note that this rate is substantially lower than the
rate of 3.5% prevailing in the United States in 1969 and which
Hall, Gordon and Holt (1970) classified as “full employment”.
For the past few years, Malta has been importing workers, with
few Maltese workers willing to work in certain high intensity
manual jobs with limited upward mobility (e.g. quarry workers,
construction workers, dishwashers) as they find other, more
convenient options available (Azzopardi, 2012). The number
of employed foreign nationals in Malta and Gozo at the end of
2017 amounted to some 44,560 persons, compared to almost
4,000 persons in 2002 (Jobsplus, 2018). The female employment
rate has also been rising steadily, although it is still one of the
lowest in the European Union (Azzopardi & Bezzina, 2014),
Motivation, commitment and control 77
and the economy has diversified from one depending mainly on

labour intensive manufacturing to one comprising various other
industries, including more modern ones such as e-gaming and
innovative financial services.
Invariably, such changes over a relatively short period of time
bring about a number of challenges. One of the largest increases
in employment opportunities is with gaming companies and
similar industries, which tend to attract a large percentage of
foreign workers. Since these jobs tend to be highly paid, and
these workers tend to rent rather than buy property, rental
prices have risen by about 47% between 2013 and 2016 (Malta
Chamber, 2017), and it is common knowledge that prices have
continued their upward trend since. As a result, lower income
workers are being priced out of renting.
Theories of Motivation and their Application to the Current

Maltese Context
A number of models have been put forward to understand what

motivates human beings at the workplace. Some of the best-
known theories will now be introduced, and their relevance to
human resource professionals in the current Maltese scenario
discussed.
Maslow’s Hierarchy of Needs

Maslow (1943) proposed that human activity is motivated
by unmet needs. These needs are organised in a hierarchical
fashion, in such a way that higher level needs do not become
motivators until lower level needs are met. This theory seems to
make sense intuitively, but it is very difficult to verify empirically.
Despite this, it is still one of the most popular motivation theories
amongst human resource professionals (Jerome, 2013).
Maslow’s theory would suggest that, in a full-employment
situation, such as the current one in Malta, most workers would
have satisfied their lower level needs, such as food, drink and
shelter, and thus would expect their work to satisfy higher-level

needs such as self-esteem and self-actualisation. This in turn
might lead to an increase in job mobility, with workers not being
averse to change jobs if their current job is not meeting these
needs. Full employment would suggest that other jobs would be
available on the market, especially when situations arise enabling
employees to work in jobs with better conditions. Consequently,
lower level jobs with limited upward mobility will be difficult for
employers to fill. These jobs are usually filled by workers who
still have to satisfy their lower level needs according to Maslow’s
hierarchy, and are therefore willing to work for the money rather
than favourable conditions, status or career aspirations; this may
prove ideal for immigrants (Azzopardi, 2012; Massey et al., 1993).
This reasoning seems to describe the current local situation
well. It is also clear that the current situation provides particular
challenges for workplaces, and more specifically human
resource managers in these workplaces. In order to keep their
best employees in a situation of high job mobility, organisations
need to make sure that their employees remain motivated by
appealing to their higher-level needs. Thus, while motivators
such as salary and job security remain important in most cases,
other factors such as a comfortable working environment and
the opportunity for personality development need to be present
in order to make sure that higher level needs are also satisfied.
Herzberg’s Dual Factor Theory

Herzberg (1966; 1982) developed Maslow’s theory by dividing
motivational factors into two types. Genuine motivators (e.g.
bonuses and recognition awards) enhance job satisfaction when
present. Hygiene factors, on the other hand, (e.g. adequate lighting
and a comfortable ambient temperature) do not motivate when
present, but act as sources of dissatisfaction when absent. This
theory has not been well supported by empirical evidence; and
the distinction between motivators and hygiene factors is not
self-evident (Reiss, 1992). A recent meta-analysis by Cerasoli
et al. (2014) considered data from over 200,000 participants in
aggregate, and found that intrinsic motivators were medium

to strong predictors of performance. In those situations where
extrinsic motivators were also present, intrinsic motivators
remained important. When extrinsic motivators were directly
linked to performance, they seem to diminish the importance
of intrinsic motivators. Conversely, the more indirect the link
between the extrinsic motivators and performance, the more
important intrinsic motivators seem to be. Finally, intrinsic
motivators seem to mostly predict the quality of performance,
while extrinsic incentives mostly predict its quantity.
Using similar reasoning, one would expect that, in a full
employment situation workers would be more motivated by
the intrinsic factors associated with specific jobs, rather than
the extrinsic ones. This in turn would lead to better quality of
performance across most types of workplaces, which of course
would be desirable. In fact, in a study carried out in a local
financial services company, Catania and Randall (2013) found
that Maltese workers were more motivated by the intrinsic
factors of their job rather than by the extrinsic ones. Age was
also negatively correlated to extrinsic motivation, implying that,
the older workers get, the less likely they are to be motivated
by extrinsic factors. This finding implies that older workers
ascribe less importance to factors such as status and salary,
presumably because these needs would already have been
satisfied. In the case of younger workers, the increasingly high
costs of purchasing or renting property, as well as the higher
standard of living expected because of the relative affluence of
the economy, mean that financial considerations are crucial, at
times even to the extent of being considered more motivating
than other issues. One must keep in mind however that the
sample in this study was made up of employees from one
organisation in a particular industry, and thus the results
might not be easily generalisable to other organisations and
industries.
Rewards can also be considered as extrinsic motivators.
A yearly monetary bonus depending on performance and a
promotion, and the resulting increase in responsibilities, can

both be motivating. In a recent dissertation (Mercieca, 2016),
200 workers from the general working population answered a
questionnaire about motivators and rewards. Predictably, in line
with most other research, a significant correlation between levels
of motivation and quality and quantity of rewards was found.
Mercieca (2016) also found that motivation was influenced
significantly more by intrinsic factors rather than extrinsic
rewards, confirming the results of Catania and Randall (2013).
These results are consistent with other findings: in a study
including over 100,000 employees from 49 countries, Huang
and Van de Vliert (2003) found that the link between intrinsic
motivators and rewards and job satisfaction was stronger in richer
countries, those which had strong social welfare programmes,
and those high in individualism and low in power distance in
Hofsetede’s (2001) classification. This profile is roughly similar
to the local one (Catania, 2014; Catania & Randall, 2013). On
the other hand, in two other dissertations, Brincat Peplow
(2015) found that MaltaPost employees were more motivated by
extrinsic, rather than intrinsic factors; while Attard (2013) found
that VAT department employees preferred financial incentives.
Overall, it seems therefore that there is a difference in effective
motivators depending on the type of job. It appears that workers
in higher level and more complex jobs, as well as those older in
age, are more motivated by intrinsic factors, while those younger
and/or in less complex jobs are more motivated by extrinsic ones.
Both Mercieca (2016) and Brincat Peplow (2015) point out that
differences exist amongst workers even at the individual level,
emphasising the difficulty organisations and human resource
professionals face when designing appropriate motivation
systems to reward employees. Finally, with respect to reward
systems (extrinsic motivators), Baldacchino, Camilleri, Grima,
and Bezzina (2017) used a qualitative methodology to assess
how Maltese co-operatives implement incentive schemes. They
found that, in most cases, the emphasis on cost-effectiveness
meant that few such schemes were being implemented in these
organisations. While these results seem to be specific to co-
operatives and not necessarily generalisable to other types of

organisations, the lack of interest in providing incentive schemes
can be considered worrying in the current job mobility situation
given the full employment on the Islands.
An important observation at this point is that males and females
seem to be motivated by different types of extrinsic and intrinsic
job factor, as was pointed out by Camilleri (2017) in his study of
Maltese civil servants from the Department of Social Security.
The availability of family friendly measures at the workplace, for
example, was considered to be a much more motivating factor
for women than it was for men, reflecting traditional gender
roles which indicate that women prioritise the family over work
more than men do. Similar differences were found by Azzopardi
and Bezzina (2014) and Bezzina, Azzopardi and Vella (2013), in
their investigations of female homemakers; and by Borg, Vella
and Borg (2007) who looked at various types of female workers.
Organisations and human resource professionals would do well to
note such gendered behavioural differences when designing their
motivational and reward systems.
McClelland’s Theory and Achievement Motivation

McClelland (1961; 1971) also developed a theory linking
motivation to needs. According to this theory, human beings are
motivated by three needs: (1) that for power; (2) for affiliation,
and (3) for achievement. All three are present in individuals
to varying degrees, with one motive being usually dominant.
McClelland (1971) also states that individuals with high
achievement needs are likely to be more successful and satisfied
at work. Longitudinal studies have found that the need for
achievement also predicts future workplace success (e.g. Stein,
Smith, Guy, & Bentler, 1993). The major problem with this theory
is that McClelland conceived of these needs as unconscious in
nature, and thus only able to be revealed by means of projective
tests. This is a situation which not all are comfortable with, as
many researchers question the reliability and validity of these
types of tests (Boddy, 2005).
There does not seem to be any recent local research testing

the main tenets of McClelland’s theory. However, the current
situation of increased job mobility due to the full employment
situation might imply that achievement is considered less
important in order to advance in one’s career: one can advance
by moving to a better job, without necessarily demonstrating
achievement in one’s current one. In other words, it might be
easier to advance in one’s career by changing jobs, rather than on
merit within the same job, in the current local climate. Human
resource professionals would do well to consider the possible
effects of this situation in their attempt to retain the best talent
in their organisations. At times, it might be worth offering
valued employees a pay rise, promotion, or other type of reward,
depending on whether they are motivated more by intrinsic or
extrinsic factors, rather than risk losing them to a competitor.
McGregor’s Theory X and Theory Y: Autonomy and Control

McGregor (1960) is credited with classifying the attitudes
and implicit theories of workplace managers towards their
employees into two types. On the one hand, some managers
believe that employees dislike working, are irresponsible and
lack ambition. It follows therefore that these employees need
to be led and controlled through extrinsic rewards and negative
sanctions (punishments). McGregor called this approach theory
X. On the other hand, managers subscribing to the theory Y
approach believe that employees primarily strive for meaning at
work and are by nature responsible, willing to work, and capable
of self-direction. Furthermore, McGregor believes that the way
in which managers manage can induce complementary attitudes
in employees. Directive managers using a theory X approach,
based on controlling their employees, lead to employees
becoming passive and dependent. On the other hand, managers
using a theory Y approach encourage participation, autonomy
and creativity among their employees. McGregor opined
that managers should adopt a more theory Y-oriented style of
management in order to be more effective. A major criticism
of McGregor’s theory is that it is relatively simplistic and

undeveloped. However, it has left a lasting mark on the study of
human resource management (Şahin, 2012).
Once again, little local research seems to have addressed
the issue of which management style is better suited, although
one may imagine that the context, as in the type of organisation
or industry, may be important here. In their study of Maltese
co-operatives, Baldacchino et al. (2017) found that monitoring
schemes (suggesting a more controlling, theory X approach)
were rarely implemented in these organisations, as they were
perceived as undermining trust. This result could however be
particular to this type of organisation, given that trust is critical
amongst workers in a co-operative. Most organisations nowadays
incorporate some sort of reward system as a motivator, and
this can be seen as a more subtle form of control. It might be
hypothesised that many employees would be reluctant to work
under more controlling and authoritative managers embracing
theory X views, especially given that the current labour
market situation enables job mobility. These workers should be
relatively willing to move to a new job should they not like the
management style in their current one. However, the situation
might be different in lower status jobs, such as construction and
manufacturing, where more traditional theory X management
models are still the norm. One must also keep in mind that the
country scores high on power distance in Hofstede’s model
of cultural difference (Hoppe, 1990). This type of culture has
been linked with workers expecting managers to be more
authoritarian and directive and thus more oriented towards
theory X (Hofstede, 1980). More local research in this area is
warranted.
Hofstede and the Consequences of Culture

Culture has been linked to motivation in various studies (e.g.
Brislin, Kabigting, MacNab, Zukis, & Worthley, 2005; Sledge,
Miles, & Coppage 2008) and various studies have shown
differences in what motivates workforces in different cultures
(e.g. Bu & McKeen, 2001). One of the most comprehensive and

widely cited studies of the influence of culture on workplace
values was conducted by Hofstede (2001). Given the extent of
Hofstede’s research programme and the number of studies
confirming his hypotheses and extending his theories (Hofstede,
Hofstede, & Minkov, 2010), there seems to be consensus that the
factors uncovered by Hofstede (power distance, individualism
vs collectivism, masculinity vs femininity, and uncertainty
avoidance) account for most of the variance underlying
differences between cultures. Nevertheless, some of his concepts
and gross generalisations have been criticised (e.g. Oyserman,
Coon, & Kemmelmeier, 2002).
Hofstede et al. (2010) have estimated the scores on the first
four dimensions for Malta, using data from an unpublished
doctoral dissertation (Hoppe, 1990). One must however keep
in mind that these scores were reported almost 30 years ago,
and Maltese culture has changed significantly in the meantime.
Malta’s profile on Hofstede’s dimensions suggests that the
Maltese are more likely to be motivated intrinsically rather than
extrinsically (see Catania & Randall, 2013), and that goal setting is
more likely to lead to unethical behaviour in Maltese employees
than in those from other cultures (Catania, 2014; 2018).
Locke and Latham’s Goal-Setting Theory

Locke and Latham’s goal-setting theory (Latham & Locke,
1991; Locke, 1968; Locke & Latham, 1990) is one of the most
empirically validated theories in the field of workplace motivation
(e.g. Wofford, Goodwin, & Premack, 1992; Zetik & Stuhlmacher,
2002). In essence, this theory consists of two basic tenets: (1) that
specific and challenging goals lead to better performance than
specific easy goals, general goals such as “do your best,” or no goals
at all; and (2) that goal-setting is most effective when accompanied
by feedback, monitoring progress towards the goal.
Goal-setting has been influential in motivational practice
within organisations: many firms use its principles to manage
human resources more effectively. Research attempting to
validate its tenets continues. Recent research has focused on

situations where goal-setting theory does not seem to work so
well. This includes research into the possible increase in risk-
taking behaviour associated with goal-setting (e.g. Larrick,
Heath, & Wu, 2009) as well as the potential of goal-setting
to lead to an increase in unethical behaviour (e.g. Welsh &
Ordóñez, 2014). The relationship between goal-setting and
unethical behaviour in Malta was also investigated by Catania
(2014): five employees at managerial level or higher in a local
financial services organisation were interviewed and asked
about the way goal-setting principles are implemented in their
workplace. The application of goal-setting principles in this
organisation, while conforming in general to the propositions of
goal-setting theory, also hinted at the possibility of unwittingly
encouraging employees to partake in unethical behaviour. The
reasons for this potential link included the fact that employees
did not participate in the setting of their own goals, and the
way rewards were tied to goal achievement. The Maltese
cultural context seems to suggest the possibility of employees
acting unethically to a greater extent than in other cultures
(Catania, 2014; 2018); so, it seems that the use of goal-setting
should be handled with caution. This is particularly important
in industries like financial services and the gaming industry,
where the consequences of unethical behaviour can be severe
(Catania, 2014; 2018). Since the Maltese Islands have been
promoting themselves as ideal for these types of businesses to
flourish in, human resource professionals would do well to keep
in mind the possible pitfalls of goal-setting, and make sure that
the goal-setting processes they implement do not encourage
behaviour which could do more harm than good. This is
particularly relevant in the current labour market situation, as
organisations might easily be tempted to use rewards tied to
set goals in order to keep their best employees, given the job
mobility brought about by full employment.
Adams’ Equity Theory and Organisational Justice

Adams (1965) applied equity theory to organisational systems,
describing how employees in organisations feel motivated as
long as they perceive that their inputs into the organisation are
similar to the inputs of their fellow employees. In other words,
employees use a process of social comparison in order to assess
whether the organisation is being fair in its distribution of
rewards. If they feel the organisation was being unfair, this would
affect their motivation, and they would use the various means
at their disposal (e.g. working slower, reporting sick, sticking
rigidly to one’s job description, or involving trade unions) to try
and redress the balance (Adams, 1965). This theory has been
criticised for seeming to work well when employees feel they
are being treated worse than their colleagues, but not when
employees feel they are being treated better – would an employee
still want to redress the balance in such cases? (Arnold, Randall,
et al., 2016). This theory has been important in the development
of theories of organisational justice (Greenberg, 1990).
An important construct related to organisational justice
is that of the psychological contract (Rousseau, 1989): the
employees’ beliefs in a reciprocal obligation between them and
the organisation. This belief is based on trust and, if employees
believe that the contract has been breached, trust between them
and the organisation will be eroded. Robinson and Rousseau
(1994) have claimed that such perceived violations of the
psychological contract are relatively common.
The relationship between psychological contract breaches
and aspects of organisational functioning has been investigated
locally in a number of studies. In a study amongst salespersons,
Cassar and Briner (2011) found that the size of the perceived
imbalance has an effect on the employees’ commitment to the
organisation: the more serious the perceived contract violation,
the greater the effect on the individual’s commitment. In another
qualitative study using 22 semi-structured interviews, Cassar
and Briner (2009) explore the significance of the context in
which the breach of the psychological contract occurs, pointing
out that the understanding and effects of such breaches may

vary according to the context. More recently, Cassar, Buttigieg,
and Briner (2015) studied 180 specific episodes of psychological
contract breach supplied by 94 participants using the critical
incident technique. This study showed that explanations for the
contract breach differed according to the type of breach, and the
type of breach was not directly related to the employee response.
In a more recent study, the same authors empirically determine
that psychological contract breach is a unitary construct
composed of different aspects, rather than there being multiple
types of breaches (Cassar, Briner, & Buttigieg, 2016). Once
again, these results suggest that the reaction to psychological
contract breach depends on various factors, including individual
employee characteristics. As a result, such a reaction is difficult
to predict, making the job of the human resource professional
dealing with such issues complex and, at times, frustrating.
Cassar and Buttigieg (2015) investigated the relationships
between psychological contract breach, organisational justice and
employee well-being amongst 420 employees of an automobile
parts company in Malta. Their major finding was that psychological
contract breach partially mediated the result between
organisational justice and emotional well-being. The current local
situation of high job mobility indicates that psychological contract
breaches perceived by employees may result in employees leaving
an organisation, given that it is relatively easy to do so and find
a job elsewhere. This situation becomes even more salient if
employees perceive such breaches as affecting their well-being, as
suggested by Cassar and Buttigieg (2015).
Organisational Commitment, Engagement and Loyalty

Meyer & Allen (1991) describe organisational commitment as
consisting of three components: namely, affective, normative and
continuance components. Meta-analytical evidence (e.g. Meyer,
Stanley, Herscovitch, & Topolnytsky, 2002) confirms this model,
and notes that all three components are related to employee
loyalty, as well as other positive organisational outcomes.
Studying employees in a local state owned IT company,

Camilleri (2002) investigated a number of possible links between
demographic variables and organisational commitment. Females
were found to have significantly higher levels of organisational
commitment than males. Employees with lower levels of
education and those with higher positions in the company also
demonstrated significantly higher levels than their counterparts.
Finally, some personality types were shown to be more prone to
commit to the organisation than others. Camilleri and Van der
Heijden (2007) surveyed 1,217 local public service employees,
and found that quality of management and certain job
characteristics were both related to organisational commitment,
and subsequently to increased employee motivation. The latter
result was similar to the one found by Camilleri (2006). Finally,
flexible work arrangements have been shown to be important
motivators, particularly for females (Camilleri, 2017). However,
there does not seem to be a correlation between flexible
work arrangements and organisational commitment in bank
employees (Muscat, 2017).
The construct of work engagement is distinct from
organisational commitment, although similar in some aspects
(Maslach, Schaufeli, & Leiter, 2001). Christian et al. (2011) found
that work engagement is related to both employee performance
and employee wellbeing. Falzon (2018) studied the relationships
between job demands and resources and engagement in a
financial services institution, and found that, when resources
were seen to be low compared to demands, engagement could
not be maintained over time.
Conclusion
An appreciation of context is crucial in determining

relationships between organisational variables and the outcomes
of organisational interventions (Johns, 2006; Rousseau & Fried,
2001). This chapter has attempted to understand the effects of
context, both in the sense of Maltese culture and in the particular

current labour market situation, on employee motivation,
commitment and control. Implications for human resource
professionals were presented and discussed. Some limitations
which hinder our understanding in the current situation
must also be pointed out. First, recent local research on these
constructs remains scant. Second, the results of available studies
can only be considered indicative, at best. Third, most research
has been carried out in larger organisations, and with particular
emphasis on financial institutions; any generalisations to other
contexts are not advisable.
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Wellbeing, quality of life
and rewards
Luke Anthony Fiorini
Reward management has traditionally been regarded as a means

of financially compensating employees in order to encourage
them to achieve, to thank them for having achieved, or for having
contributed to the achievement, of predetermined individual,
group or company objectives. Owing to developments in the
scientific study of what motivates humans, as well as to gain
a strategic and competitive advantage on other businesses,
but without endlessly increasing salary and other financial
perks, management professionals no longer speak solely of
compensation, but now offer rewards. Rewards continue to
include such financial aspects as salary, allowances, bonus pay
and benefits; but they also include non-cash elements such as
offering a welcoming workplace, intrinsically interesting jobs, and
opportunities for personal growth (Heneman & Coyne, 2007).
In fact, Armstrong (2012, p. 6) describes reward management
as the “strategies, policies and processes” that allow individuals’
contribution and value to be recognised and rewarded – and not
just those involving money.
For reward systems to be of value to both the employees
and their organisation, the rewards offered must appeal to that
organisation’s workforce and lead to positive organisational

outcomes. Such outcomes should include improved employee
motivation and performance levels, but also employee attraction
and retention. Human resource (HR) and management
professionals sometimes fail to associate measures designed to
improve worker wellbeing and quality of life (QoL) with either
reward management, or positive organisational outcomes such
as work performance. Instead, these are often side-lined as a
health and safety cost. This chapter will however illustrate that
such measures can aid in boosting human motivation and work
performance, whilst also fitting within a comprehensive reward
strategy.
Little agreement exists regarding how to define QoL.
Various studies that have focused on this notion have ended
up measuring very different concepts (Gill & Feinstein, 1994).
Felce and Perry (1995) acknowledged this lack of agreement and
brought together the main QoL approaches at the time. They
identified five facets of QoL:
(1) physical wellbeing, which included aspects such as
health, fitness, safety and mobility;
(2) material wellbeing, which included finance and income,
quality of housing, possessions, food and transport;
(3) social wellbeing, which included both interpersonal-
relationships and involvement in the community;
(4) development and activity, which included education, job,
competence and activities at home and private life; and
(5) emotional wellbeing, which included positive feelings,
status and respect, satisfaction, fulfilment, faith and self-
esteem.
Whilst highlighting how vast and holistic QoL is, the

authors also established the interrelationship between QoL and
wellbeing. This link was confirmed by Costanza et al. (2007) who
focused on human needs. Costanza et al. (2007, p. 269) defined
QoL as the “extent to which objective human needs are fulfilled
in relation to personal or group perceptions of subjective well-
Wellbeing, quality of life and rewards 97
being.” The authors listed various needs including: subsistence,

reproduction, security, affection, understanding, participation,
leisure, spirituality, creativity, identity and freedom. Notably,
Costanza et al. (2007) stated that the degree to which each need
is considered important is likely to vary between individuals and
groups. Finally, Gasper (2010) noted that QoL and wellbeing had
a broad range of meanings which almost completely overlap.
However, he noted that wellbeing was often used to speak of
individuals, whereas QoL was used to discuss communities and
societies. This may be reflective of their origins, with wellbeing
emerging from psychology and QoL from sociology. For the
purpose of this chapter, therefore, wellbeing and QoL will be
discussed as one; in practice, they include satisfaction with
factors such as wealth, safety, health status, mental wellbeing,
work-life balance, education and skills, social connections,
inclusion and environmental quality (Eurofound, 2017a; OECD,
2018).
The next section discusses human motivation and rewards
and, in so doing, makes a case for providing workers with a
rewarding and healthy workplace. This is followed by a review of
the wellbeing of the Maltese workforce. Measures which are, or
can be, implemented by Maltese companies to boost wellbeing
are next discussed. A conclusion wraps up the main argument.
Rewards, human motivation, wellbeing and work

performance
Organisations offer rewards in the hope of motivating

employees. This is a priority for those in management, given the
positive links between motivation and human behaviour. Reeve
(2014) identifies six such links between motivation and human
behaviour.
(1) choice: when presented with several courses of action,
unmotivated employees may avoid their allocated tasks,
instead focusing on something which is less critical to
the organisation (if at all). The motivated, on the other

hand, are more likely to focus on the needed tasks;
(2) latency. This refers to how long it takes individuals to
begin working on a task, given the opportunity to start
doing so. Whereas the unmotivated may procrastinate,
more motivated employees are likely to work on the task
with more immediacy;
(3) the level of effort. This suggests that the motivated are
likely to produce work of a better quality;
(4) persistence. Thus, motivated individuals may take less
time to complete a task, whereas unmotivated individuals
are more likely to lose focus. Furthermore, many work
tasks can be challenging: while a motivated worker may
persist in the face of difficulties, the unmotivated are
more likely to give up;
(5) probability of response: this refers to the percentage of
times a person reacts in a similar manner. Generally,
motivated individuals are likely to respond in a similarly
positive manner more often than those who are less
motivated; and
(6) emotional and cognitive reactions: The motivated
are more likely to experience positive work-related
feelings and thoughts; this is likely to affect the way they
communicate about their jobs, their facial expressions
and their postures, amongst others.
Zammit (1984) develops a typology based on Merton

(1938) and his ‘strain theory’ to explore choices tackled by
workers when faced with situations of relative powerlessness.
These choices are based on a combination of workers’ views
on organisational goals and on the means to be followed in
pursuit of such goals. Conformists are those workers who would
wholeheartedly embrace their organisation’s mission as well as
the actions to be followed in pursuit of such a mission: their
levels of motivation can be expected to be high. Innovators would
also adopt the organisational goals as their own; but they may,
intrapreneurially, seek alternative and unconventional ways of

achieving those goals: a pursuit from which the organisation can
benefit handsomely. They may send contradictory signals about
the extent to which they appear motivated at work. Ritualists
would give the impression of being conformists: they also do
what they are supposed to do; but they do so mechanically, out
of compliance and not consent or commitment, lacking meaning
and emotional engagement. They play by the rules and stick to
a safe work routine, strategically calibrating levels of motivation
so as not to arouse managerial concerns. Retreatists lack self-
esteem, feel alienated and do not see themselves as a good fit
with the organisational goals, or with the means expected for
the fulfilment of those goals: these are likely to be seriously
demotivated. Rebels, finally, would reject both the organisational
objectives and the protocols in place. Such an oppositional stance
may see them becoming active as trade union representatives at
the workplace; or else seek to disconnect from the firm and look
for alternative employment.
The benefit of motivated employees is thus evident. The
bigger challenge is: how can such levels of motivation, and
thus performance, be fostered and nurtured? One of the first
individuals to study this topic was Taylor (1914) who, apart
from redesigning tasks and tools to make these more simple and
efficient, regularly linked the attainment of the needed level of
performance with higher wages (also Locke, 1982). Financial
rewards remain a major method to entice better performance
from workers. Studies indicate that such rewards can lead to
improved performance but have also received criticism for
having a negative impact upon workers’ internal motivation,
amongst others (Marshall & Harrison, 2005).
In a quest to understand human motivation, theorists have
also focused on human needs and how the process of motivation
occurs and sustains itself (Armstrong, 2012). Amongst others,
this has led to the realisation that humans are motivated by
different things, such as affiliation, achievement and power
(McClelland, 1967), rewards are only motivating when considered
achievable and valuable by the employees themselves (Porter &

Lawler, 1968; Vroom, 1964), and the work itself can be a source
of motivation (Hackman & Oldham, 1980). In fact, goals that
are clear, challenging but realistic, require commitment, provide
feedback, and have manageable task complexity, appear to boost
motivation (Locke & Latham, 1990).
Whilst work can be a source of motivation, it can also be a
source of stress and ill health. This is probably best illustrated
by the Job Demands and Resources (JD-R) model (Bakker &
Demerouti, 2007; Demerouti, Bakker, Nachreiner, & Schaufeli,
2001). The model states that the level of stress or motivation
an employee experiences depends on two categories of factors;
job demands and resources. Job demands are those aspects of
the job that require sustained physical, psychological and/or
cognitive effort. Examples include workload, time demands
and emotional demands. Conversely job resources are factors
that assist employees in achieving their work goals, reduce
demands and stimulate growth (Bakker & Demerouti, 2007).
Examples include support from colleagues and management,
autonomy, and development opportunities. The model
postulates that, when faced with excessive job demands,
workers are stressed and their personal mental and physical
resources are diminished. This results in exhaustion, the
development of health issues and poorer levels of wellbeing.
On the other hand, job resources can result in improved
motivation, work engagement and work performance.
Furthermore, JD-R notes that the presence of work resources
can reduce the negative effect of demands: job motivation and
engagement are expected to be highest when both demands
and resources are high (Bakker & Demerouti, 2007). Various
published studies have provided support for the JD-R model.
They have also confirmed the negative impact of excessive
demands on worker strain and their harmful impact upon
health, as well as the positive impact of work resources on job
motivation (Bakker, Demerouti, De Boer, & Schaufeli, 2003;
Schaufeli, Bakker, & van Rhenen, 2009).
For rewards to impact upon work performance, it would

therefore be beneficial for employees to be equipped with the
resources required to cope with work demands. The negative
impact of excessive demands upon health however, also has
performance consequences. The most apparent is that burnt
out employees and those with poor levels of health engage in
greater sickness absenteeism (Bakker et al., 2003). Sickness
absenteeism, whilst often necessary to foster recovery, is costly
for organisations. Apart from the costs linked with the absent
workers’ on-going salary, relief staff may have to be compensated
for replacing absent workers. Absence can also place greater
demands on other workers, demotivating them and damaging
their own health. Overtime payments may also occur should
the remaining workers fail to cope with their added demands in
time.
Whilst absenteeism can be reduced by the provision of a
healthier workplace, some employers in Malta try to tackle this
by implementing policies designed to restrict absenteeism: this
may involve tightly policing absenteeism use, or policies that
indirectly reward individuals for not being absent. The purpose
behind such policies is generally to limit absenteeism to when
it is really needed. This originates from beliefs that employees
frequently engage in sickness absence for reasons perceived
as illegitimate. These include ‘self-inflicted’ illnesses such as
hangover following a night of partying, sports injuries, sunburn
and cosmetic surgery (Malta Employers Association, 2014).
The risk of such employer strategies is that they can encourage
workers who are in fact sick, be it with a physical or psychological
illness, to attend work: a behaviour known as presenteeism
(Johns, 2010). In fact, strict policies designed to limit
absenteeism not only increase presenteeism, but they frequently
result in longer absenteeism episodes, as workers are fearful of
returning to work too soon should it result that they need to
revert to sick leave (Grinyer & Singleton, 2000; Munir, Yarker,
& Haslam, 2008). Presenteeism is costlier to organisations than
absenteeism (Collins et al., 2005; Goetzel et al., 2004): a multitude
of expenses have been associated with ill individuals attending

work (e.g., Lohaus & Habermann, 2018), many of which are
associated with the productivity losses that unwell individuals
cause or experience, and which have various negative knock-
on effects for the organisation. These may include: increased
errors and accidents, damaged work equipment, defects in
products, missed deadlines, disgruntled clients and damage to
an organisation’s reputation and its attractiveness as a potential
employer. High levels of presenteeism can also erode employee
morale, attraction and retention. Presenteeism can also lead to
the transmission of illness to co-workers, clients and products
when the disease is contagious. Finally, presenteeism has negative
effects on workers’ health and exacerbates future absence due
to sickness (Gustafsson & Marklund, 2011). Managers in Malta
should be as concerned about managing presenteeism as they
are about tackling absenteeism.
This section has therefore illustrated that rewards which aid
employees cope with their work demands should be prioritised
because the ensuing demotivation and reduced wellbeing will
impact badly on organisational performance. However, is the
wellbeing of workers in Malta an issue? This is explored in the
next section.
The health and wellbeing of the Maltese workforce
The most ubiquitous health-related measures of the Maltese

workforce are statistics on occupational deaths and injuries.
Injuries appear to have decreased steadily over the years until
2011. Since then, injury rates have remained relatively steady,
with the number of injured males declining slowly, whereas
injuries among females appear to be slowly rising. These trends
are likely due to increasing employment rates, particularly of
women (Fiorini, 2018). In fact, the Occupational Health and
Safety Authority (OHSA, 2017) notes that when corrected per
capita, injury rates have declined from 2,912 per 100,000 workers
in 2002 to 1,261 per 100,000 in 2016, a marked improvement.

Injuries are not spread equally across industries; in 2017, 80% of
injuries occurred among males, often because they work in more
dangerous sectors and perform more dangerous jobs, mainly in
manufacturing (19.5%), construction (18.8%) and transport and
storage (14.5%). Among females, in contrast, most injuries occur
in human health and social work activities (28%), administrative
and support service activities (13.6%) and transport and storage
(12.4%) (NSO, 2018). The statistics therefore indicate that the
different sexes have different levels of injury when assessed
against specific occupational sectors.
For each reported injury, workers contract considerably more
illnesses and diseases. The Sixth European Working Conditions
Survey (EWCS), conducted in 2015, reported that health levels in
Malta were above the EU-28 average (around 78%), with around
82% of Maltese workers reporting that they had good levels of
health (Eurofound, 2017b). This is corroborated by findings from
the European Quality of Life Survey (EQLS) (Eurofound, 2017a)
and Eurostat (2017) statistics: these suggest that health levels are
reduced among those with lower levels of education or income.
Little information is available on specific occupational
diseases in Malta. The EWCS found that, at a European level,
the most reported health problem are backache (43%), muscular
pains in the neck and upper limbs (42%), headache and eyestrain
(35%), fatigue (35%), muscular pain in the hip or lower limbs
(29%), anxiety (15%), skin problems (8%), injuries (8%) and
hearing problems (6%) (Eurofound, 2017b). Unlike injuries, all
these health problem are more frequent among women than
men, except injuries and hearing problems. The statistics appear
reflective of the situation in Malta: a study of Maltese nurses found
that the most common health problems were musculoskeletal
disorders (MSDs), respiratory problems, common mental health
disorders (CMHDs), headache and fatigue (Fiorini, Houdmont,
& Griffiths, 2018a). The frequency of illness and disease however,
may be lower in Malta. Long-standing (or chronic) illnesses,
along with the percentage of individuals experiencing bodily pain,
appear less common in Malta than in the EU (Eurofound, 2017a;

Eurostat, 2017). Limitations in daily activities due to physical or
mental health problems or disability (Eurofound, 2017a), and
frequencies of chronic depression in Malta (Eurostat, 2015a)
also appear to be below the EU average. Finally, the Maltese have
above EU-average life expectancy and are amongst the most
likely to experience healthy life years (also known as disability-
free life expectancy) (Eurostat, 2015b, 2017).
Other facets of wellbeing and quality of life also appear to
be positive in Malta. The EQLS (Eurofound, 2017a) determined
that, compared to the EU-28 average, workers in Malta recorded
higher levels of satisfaction regarding their life overall, job,
present standard of living, accommodation and family life.
Furthermore, the Maltese samples showed above average scores
in happiness, optimism about the future, and feeling that what
they do in life is worthwhile.
Not all findings, however, have been positive. The Maltese are
the most overweight and obese in Europe and report amongst
the lowest levels of physical activity in EU. Prevalence of chronic
diabetes in Malta is amongst the highest in the EU. High blood
pressure in Maltese men is slightly higher than the EU average;
women, however, report average levels. Conversely, whilst tobacco
use among Maltese males is just below the EU average, among
females it is just above the average. Alcohol consumption in Malta
appears to be below EU average levels (Eurostat, 2014). Mental
wellbeing levels in Malta appear to be below EU average levels
(Eurofound, 2017a, 2017b). In fact, the EQLS (Eurofound, 2016)
found that the Maltese were less likely to: have felt cheerful and in
good spirits; have felt calm and relaxed; have woken up fresh and
rested; and scored amongst the lowest scores in the EU regarding
feeling active and vigorous. The Maltese sample was also more
likely to feel: particularly tense; downhearted and depressed; and
that their daily life was not filled with things that interested them.
Almost all of these negative findings were worse among females.
The EWCS also places Malta as the country with the highest
rate of both absenteeism and presenteeism in the EU (Eurofound,
2017b). This is particularly relevant as high rates of absenteeism

alone could be interpreted as workers possibly abusing of
absenteeism. As workers also need to attend work while feeling
ill at very high frequencies, this is indicative of poor overall
levels of health (Gerich, 2015). This is curious, considering that
the same survey rated the health of Maltese workers as above
the EU average. This may be reflective of poorer rates of mental
health. After all, health is not merely the absence of illness. For
example, individuals who consider themselves as healthy can
still suffer from bouts of back pain or depression a few times
a year, resulting in episodes of presenteeism and absenteeism.
These findings may also reflect poor levels of work-life balance
and time demands. These issues are explored in the next section.
Rewards
Reward approaches encourage practitioners to consider both

financial and non-financial rewards and to package these together
as a comprehensive rewards package (Armstrong, 2012). This
can be beneficial since different individuals are motivated by
different rewards. It is also of value in view of the broad factors
that influence wellbeing. The following section will focus on
rewards that are related to wellbeing and will also review levels
of wellbeing in Malta.
Financial rewards
Financial rewards – such as base pay, contingent pay, employee
benefits and allowances – play a major role in reward approaches
by firms in Malta. Financial rewards are linked to better work
performance, particularly when these are equitably distributed
(Garbers, & Konradt, 2014). Workers with better incomes in
Malta also report various other benefits, including better life
satisfaction and happiness, better levels of health, suffer from
less chronic diseases, experience better mental wellbeing, and
appear to be more resilient (Eurofound, 2017a). Among Maltese
women, achieving financial independence is a primary motivator

for seeking and remaining in employment (Bezzina, Azzopardi,
& Vella, 2013). Workers in Malta however, record pay satisfaction
for work done at levels below the EU average (Eurofound, 2015).
A healthy working environment, health promotion and cure

Physical and mental wellbeing are essential facets of the
quality of life; therefore, organisations should strive to reward
employees with a working environment which fosters both of
these. Many health issues – such as MSDs and CMHDs – are
triggered by workplace dynamics and, unless these are tackled,
such issues are likely to become chronic or recurrent. Aiming
for healthy workplaces appears to be a needed priority in Malta:
workers are more likely than the EU average to appraise their
workplace as harmful to their health and are amongst the least
well-informed about health and safety risks related to their job
in the EU (Eurofound, 2015). A healthy environment can also
aid workers to stay in their jobs longer, and foster inclusion of
disabled workers. Currently, the Maltese are less likely than the
EU average to think that they can continue in their current job at
age 60 and beyond (Eurofound, 2015).
Throughout Europe, the most frequent risk factors present in
establishments are those that precipitate MSDs and CMHDs (EU-
OSHA, 2016). In the case of MSDs, these include tiring and painful
positions, including prolonged sitting, repetitive hand or arm
movements, and lifting and moving heavy loads, including people.
In the case of CMHDs, the most common risk factors include
dealing with difficult customers, patients and pupils, as well as time
pressure. With the exception of lifting heavy loads, the physical
risk factors appear to be less frequent in Maltese establishments
than the EU average. However, the prevalence of psycho-social risk
factors appears to be much higher in Malta than in Europe, with
Malta found to have the highest prevalence of dealing with difficult
customers in the entire EU (EU-OSHA, 2016).
Occupational health and safety (OHS) issues need to
be identified and controlled through risk assessment. And
yet, regular risk assessment appears to be carried out less

frequently in Malta than in Europe (EU-OSHA, 2016). Risk
assessments must also include factors that precipitate mental
issues (discussed below). Notably, employers in Malta rank last
in the EU in believing they have sufficient information on how
to include psycho-social risks in their risk assessments (EU-
OSHA, 2016). Employers who lack competence in health and
safety matters among their staff should consider contracting
the services of a relevant professional. Currently, employers in
Malta use the services of health and safety generalists, experts
in accident prevention, and ergonomic experts less than the EU
average (EU-OHSA, 2016). When seeking to identify an OHS
generalist, employers should be aware that the University of
Malta offers diploma and degree courses in occupational health
and safety; whilst the OHSA maintains a ‘competent persons
register’ (OHSA, 2018). The OHSA’s website also contains
useful resources, including a framework for effectively tackling
workplace stress.
Employers can also reward workers, whilst providing them
with the personal resources to cope with their job, by conducting
health-promotion initiatives. Healthier workers require less sick
leave (Rasmussen et al., 2015), whilst health promotion initiatives
reduce health-related performance losses at work (Chen et al.,
2015). Maltese organisations appear to be quite proactive in this
area, with above EU-average prevalence in raising awareness on:
healthy eating; the prevention of addiction to substances such
as tobacco, alcohol, and drugs; and the promotion of sports
activities outside working hours. Maltese firms however lag
behind in promoting physical exercise within the workplace
(EU-OSHA, 2016). Examples of steps taken within Maltese
enterprises in these respects include: having a swimming pool
and/or games rooms that are available for use during working
hours; providing healthy meal options; offering standing desks to
reduce time spent sitting down; investing in an in-house gym or
offering free gym memberships; setting up after-hours football
and running clubs; organising exercise-oriented extra-curricular
activities such as sport days and hiking; offering exercise balls

which can be sat on at one’s desk; promoting short ‘stretch-
breaks’ where workers stop from their tasks for a few minutes
to carry out specific exercises; setting up exercise classes at the
workplace, including yoga, tai-chi, Pilates and circuit training;
and participating in national sporting events such as marathons
or charity runs.
A final consideration is the early identification, treatment
and support of workers who are suffering from physical and
mental health problems. Unsupported workers are likely to
report more absenteeism, presenteeism, performance loss, and
may potentially drop out of the workforce. Some establishments
offer workers free or subsidised medical health insurance. This
can allow workers to access private healthcare which they may
otherwise be unable to afford; a valuable resource. Return-to-
work programmes, which assist those struggling to re-access
the workplace following extended sick leave via treatment
and the modification of work, are still lacking in Malta (Belin,
Dupont, Oules, Kuipers, & Fries-Tersch, 2016). Providing such
rewards for those struggling to remain at work remains equally
relevant. Statistics, however, suggest that about half of Maltese
organisations routinely analyse sickness absence with a view to
improving the working conditions (EU-OSHA, 2016).
The engagement of occupational doctors, ergonomists,
physiotherapists and psychologists can aid with such matters;
however, their involvement in Maltese firms remains below
the EU average (EU-OSHA, 2016). One area that appears to be
developing is the provision of Employee Assistance Programmes
(EAPs). The focus of EAPs tends to vary: most often, they
provide employees with support for mental and personal issues,
often via the provision of training and counselling services. They
also appear to be welcomed by Maltese employees (Campbell,
2015). The Government of Malta provides such a service to its
public employees (Government of Malta, 2018), whereas private
companies often outsource such services from providers including
the Richmond Foundation (Richmond Foundation Malta, 2018).
Job demands, hours and work-life balance

Measures that aid employees to achieve better work-life balance
are another valuable category of rewards and resources. Most
frequently, these are framed as ‘family-friendly measures’ and are
designed to facilitate juggling work and caring responsibilities
related to children and other dependants. Such measures are
increasingly relevant as the number of females in the workforce
increases, more males take on parental responsibilities,
and Malta’s population ages; resulting in increased caring
responsibilities of elderly relatives. Popular measures include:
reduced hours, flexible working hours, remote working, the
provision of childcare services, extended parental leave and
allowing individuals to bring children to work when necessary.
Working parents also often face a challenge when children are
sick. A proposed legal measure to allow a portion of sick leave
to be utilised for caring for ill dependents was shot down by
employers (Xuereb, 2018); however, some Maltese firms have
acknowledged that this measure may suit them in attracting and
retaining female employees. They have thus implemented this
measure at their workplaces.
Work-life balance however, should not be solely
conceptualised as family-friendly measures. Work-life balance is
often challenged by excessive work demands, including excessive
workloads and long working hours that compromise workers’
private life (Deery & Jago, 2015). In several instances, flexible
and remote working can result in working beyond one’s agreed
weekly working hours. This often occurs because of unrealistic
workloads, with much work going unseen as it occurs outside
the workplace. Such workers can also experience expectations
that they need to be available around the clock. Such situations
encroach on free time and prevent workers from ‘switching off ’
(McDowall, Kinman, & Grant, 2015). Such a culture is likely to
have a more negative impact on workers, particularly women,
impacting their attraction and retention (Deery & Jago, 2015),
whilst resulting in employee burnout, morbidity and impaired
performance. Conversely, a positive work-life balance is a
valuable resource that allows workers to cope with workplace

and personal demands, whilst being associated with better
health and wellbeing (Lunau, Bambra, Eikemo, van der Wel,
& Dragano, 2014). Workloads and working hours need to be
realistic, and firms can consider implementing policies where
workers are not expected to reply to communications (such as
emails) outside agreed hours.
Work-life balance measures appear to be badly needed
in Malta. Work-life balance declined in Malta between 2007
and 2011, and has since remained steady at this poorer level
(Eurofound, 2017a). The Maltese work longer hours, and are less
likely to have the time to do the things they really enjoy, than
their EU counterparts (Eurofound, 2016; 2017a; 2017b). This is
compounded by spending more hours caring for dependants
over the age of 75. The Maltese have found it more difficult to
combine paid work with caring responsibilities, and believe that
their working hours fit their family and social commitments less
well than the EU average (Eurofound, 2016). There also appears
to be a desire for better work-life balance amongst the Maltese.
Rizzo (2004, 2009) determined that around three quarters of
Maltese workers would rather have a lower paid job with normal
hours, than a highly paid job with longer hours. Rizzo (2004)
also determined that those in the youngest age group in the
workforce (16-24) were most likely to change their job for one
with better hours.
Maltese enterprises are amongst the most likely in Europe to
reorganise work to reduce job demands, and to intervene when
excessively long or irregular hours were worked (EU-OSHA,
2015). Where workload and working hours cannot be reduced,
workers need to be provided with the resources to cope. Workers
require a healthy environment, the necessary tools and skills, as
well as a culture of support from managers and co-workers; this
results in a more pleasant workplace and can also assist older and
injured workers to cope (Fiorini, Griffiths, & Houdmont, 2018b).
Positively, Maltese workers appear to experience less adverse
social behaviour than the EU average, whilst also reporting
amongst the best levels of support from both colleagues and

managers in Europe (Eurofound, 2015). Other positive measures
that Maltese firms deploy in order to tackle various work
demands include: action plans to handle work-related stress;
procedures to tackle bullying and harassment; procedures to
confront threats, abuse and assaults by clients, and having
conflict resolution procedures in place (EU-OSHA, 2015).
Intrinsically rewarding jobs and development

The Job Characteristics Model (Hackman & Oldham, 1980)
recommends enriching monotonous, alienating and meaningless
jobs to create ones that are intrinsically motivating. The model
thus suggests ensuring that jobs are meaningful, and that workers
enjoy considerable autonomy and benefit from useful, constructive
and regular performance feedback. The latter occurs when jobs
require various skills, lead to an identifiable piece of work, and
positively impact the lives of individuals inside or outside the
firm. Depending on the job, enrichment can therefore require
substantial job re-design and employee training and development.
The outcome of enrichment has not always been positive: some
early studies suggest that enrichment was better received by
white-collar workers than blue collar ones; the latter were less
interested in having challenging jobs that encouraged personal
development: perhaps a fatalistic expectation, in resignation
to a work predicament which they did not expect could be
changed for the better? (Terkel, 2011). As enrichment generally
involves learning new skills, it can also complicate remuneration
(Giancola, 2011). However, meaningful work has been linked with
better levels of work engagement (Steger, Littman-Ovadia, Miller,
Menger, & Rothmann, 2013), whilst job enrichment has often been
linked to greater satisfaction and reduced turnover (Yang & Lee,
2009). Furthermore, most workers do value autonomy, interesting
and challenging work, receiving feedback and development
opportunities (Giancola, 2011).
Studies of workers in Malta corroborate this (Bezzina et
al., 2013), sometimes highlighting that intrinsic factors can
be considered more motivating than extrinsic factors such as

financial benefits (Camilleri, 2017; Catania & Randall, 2013;
Mercieca, 2016). Designing such jobs may therefore be a useful
way to boost employees’ wellbeing, particularly where workers
desire it. Because of the dynamic nature of many of Malta’s
workplaces and jobs, as well as the current restricted supply
of human resources, a degree of enrichment may occur in an
unintended manner. In fact, workers in Malta are more likely to:
have challenging and enriching work; learn new things at work;
receive on-the-job training; choose or change the order of their
tasks, pace of work, and methods of working; and experience
greater work satisfaction, meaningfulness and engagement than
the EU average (Eurfound, 2015).
Finally, employers often use recognition schemes to reward
and motivate employees. Armstrong (2012) differentiates
between day-to-day recognition, public recognition and tangible
recognition. Day-to-day recognition refers to the monitoring,
feedback, support and the potential ‘pat on the back’ employees
should be receiving from their managers on a regular basis.
Public recognition appears to be gaining in popularity in Malta.
Examples include; employee of the month, employee award
ceremonies, publicly recognising employee achievements on
company media such as newsletters and Facebook pages, and
physical applause and celebration when a team or company
milestone is achieved. Such recognition becomes tangible when
gifts are involved. These include: cash vouchers, gifts, parties
and paid local or foreign trips.
Conclusion
Rewards can boost workers’ quality of life and wellbeing, and

in so doing, lead to improved work performance. They can
also prove to be powerful inducements towards attracting and
retaining workers. Management and HR professionals should
aim to offer holistic rewards that mirror the different facets
of wellbeing and quality of life, placing special emphasis on

rewards that provide employees with the resources to cope
with their work demands. Workplace health and safety should
be viewed as a strategic advantage; risk assessments should
be undertaken, updated when necessary, and also include
risk factors relevant to mental health. Employers should also
measure both absenteeism and presenteeism; if either of these
is highly prevalent, establishments should aim to explore their
causes. Measures meant to tackle physical and mental health
issues, as well as high rates of absenteeism and presenteeism,
include: assuring safe workplaces; supporting health promotion
initiatives, including healthy meal options and fostering physical
activity within the workplace; treating those struggling with
ill health; introducing return-to-work programs and family-
friendly measures; having realistic demands a work, including
realistic workloads and working hours; training on how to deal
with difficult clients; offering peer and management support;
assuring personal development opportunities; and providing
interesting work. Prior to implementing any of these measures,
managers are encouraged to involve employees and/or their
representatives to ensure that such measures are needed and to
foster participation in how these will be implemented.
This chapter has highlighted that wellbeing levels in Malta are
generally better than the EU average; still, certain shortcomings
are evident. Injury statistics indicate that the construction,
manufacturing and the transport and storage industries remain
hazardous and warrant special attention from both employers
and the labour inspectorate. This also applies to the healthcare
industry where most females appear to be injured. Statistics on
occupational illnesses and diseases are not being collected and
efforts should be made to remedy this situation. Occupational
doctors, physiotherapists and ergonomists should work inter-
professionally to introduce return-to-work programmes for
injured workers, supported by the state. Mental health also
requires greater attention; the government EAP and the OHSA’s
framework for tackling work-related stress are good starting
points, and more can be done to ensure that the topic receives
the attention it deserves. Relevant government departments could
address stigmas regarding mental health; while employers need to
be better informed about the relevance of mental health at work
and how to tackle it. Finally, the levels of obesity and the lack of
physical activity in Malta are alarming; and more needs to be done.
Whilst individuals should be taught to live a healthy life from a
young age, workplace health promotion initiatives should also be
encouraged by human resource professionals and state entities.
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Equality, Diversity and
Inclusion
Anna Borg
This chapter focuses on the diversified work force and the

challenges this raises in tackling discrimination and promoting
equality for an inclusive workforce. The chapter starts by
discussing the key concepts surrounding the issue of equality
and the different grounds of discrimination covered by law.
Equality, diversity and inclusion remain unreachable goals if
discrimination is not well understood; hence the chapter seeks to
give a better understanding of the root causes of discrimination
and its manifestation. After discussing the key concepts, the
chapter then moves to offer a more detailed picture of the
state of equality – or lack thereof – in relation to two grounds
for discrimination: gender and race. The chapter concludes by
discussing the complexities and the difficulties that are typically
encountered in tackling inequalities and discrimination at work,
and how these issues go beyond the workplace.
The ‘ideal’ worker in an evolving and diversified labour

market
For many years, the norm for an ‘ideal worker’ in many parts of
the Western world was generally held to be: a white, able bodied,
heterosexual male of prime age who forms part of the dominant
culture and religion (Christian faith), and for whom paid work
takes precedence over unpaid family care work. This notion builds
upon, but extends, the theory of gendered organisations (Acker,
1990) which focuses largely on gender. In harbouring these
assumptions, by implication it may be assumed that: women, but
especially mothers with young children; people with mental or
physical disabilities; people with a different sexual orientation or
gender expression; older and young inexperienced workers; and
foreign workers – especially if assumed to be Muslims – do not
fall into the category of the ‘typical ideal’ workers in the Maltese
context. In itself, the notion of the typical and non-typical worker
facilitates and restricts the access of specific workers into the
labour market and affects the positions they will occupy within
the job hierarchy and economic segments (Acker, 1990). The
notion also impacts on the extra hurdles and adversities some
are likely to face because of the added layers of discrimination
(Cook, 2016; Kumra, & Manfredi, 2012).
Whilst taking note of the assumptions, it must be noted that
the Maltese labour market is being diversified at a very fast pace
and progress has been made on many grounds. For example, more
and better educated women are remaining in larger numbers in
the Maltese labour market and the female employment rate has
reached an all-time high of 56.5% (NSO, LFS, Q1, 2018). The
diversification process has been accelerated with the inflow of
some 44,560 foreign workers which were absorbed in the growing
labour market (Jobs Plus, 2018). Older workers and people with
different abilities and disabilities are being constantly urged and
encouraged to enter and remain active in the labour market
(Budget, 2017; Budget, 2015). Furthermore, attitudes concerning
the LGBTIQ community have improved considerably (Leone
Equality, Diversity and Inclusion 121
Ganado, 2015) and Malta’s legislation in relation to their rights

is amongst the most avant-garde across the EU (ILGA Europe,
2018). Whilst positively noting the progress made on these
grounds, does this mean that we have eradicated discrimination
and achieved equality in the Maltese labour market?
Equality: demystifying the concepts
Before trying to answer the question raised above, it becomes

essential to clarify the concept surrounding the notion of equality.
Equality, in principle, can be framed around issues of social justice.
It serves to remind us of our common humanity despite any
differences that we notice between us (Stanford Encyclopaedia of
Philosophy, 2007). Article 1 of the Universal Declaration of Human
Rights asserts that “All human beings are born free and equal in
dignity and rights” (United Nations, 1948). On the aspect of work,
Article 23 of the same declaration enshrines the right to work, with
just and favourable conditions and the right to fair remuneration,
including equal pay for equal work. These rights also guarantee
the right to join, or to form, a trade union and the right to rest and
leisure. The European Convention on Human Rights (ECHR, 1950)
also prohibits discrimination, and makes explicit reference to the
prohibition of slavery and forced labour, which may be considered
as the ultimate forms of discrimination and inequality.
Sociologists, economists, lawyers, employers and managers
generally struggle with this word because equality can mean
different things to different people (McCrudden & Prechal, 2009;
Stanford Encyclopaedia of Philosophy, 2007). Understanding
equality, or the lack of it, is crucial if we want an inclusive
workforce that looks at diversity as a gain rather than a threat.
Diversity and inclusion will remain empty words if people are
not treated fairly and equally and if discrimination is allowed to
fester in organisations. But what does equality mean and how do
you determine that a worker is not being treated equally when
compared to another worker?
Equality does not mean that we should treat everyone in the

same way at the place of work. Not all differences in treatment
are unlawful. One can make distinctions between workers if an
objective and reasonable justification exists (ECHR, 1950). In
the labour market, these generally refer to distinctions based on
skills or effort, the length of service, the level of education, and
the numbers of hours worked, amongst others. There are also
a few examples where the actual exigencies of a job entail the
selection of, say, a woman over a man, or vice versa: examples
include body searches, or washing patients in hospitals, or the
selection of a younger worker over an older one in the case of
jet pilot training (Kumra & Manfredi, 2012). Differences are also
acceptable when we accommodate and adopt special measures,
as in the case of protecting pregnant workers or when making
special arrangements for disabled or impaired workers.
It is often assumed that working towards a fair and inclusive
workforce is a chore or at best a duty to avoid costly legal action. Yet,
there are win-win benefits for managers who take extra measures
to prevent discrimination and to promote fair treatment and equal
opportunities for all. Companies who tackle discrimination and
promote equality, diversity and inclusion over time gain a good
reputation. This is critical when trying to attract rare skills and
talent in specific sectors (Kumra & Manfredi, 2012). Furthermore,
if an organisation does not discriminate at the recruiting stage, it
stands a better chance of attracting the best candidate, rather than
recruit a worker who fits the traditional mould. People of different
genders, different ages, different cultures and different abilities,
can deliver fresh perspectives that can challenge old ways of
working and open up ideas to tap new markets (Hunt, Layton, &
Prince, 2015). Diversified groups are also better at problem solving
(Larson, 2017) and the collective intelligence in groups improves
with the proportion of females in the group (Williams, Woolley,
Chabris, Pentland, Hashmi, & Malone, 2010). When workers are
treated fairly, absenteeism decreases and commitment increases,
and employees are less likely to seek work elsewhere (Patrick &
Raj Kumar, 2012).
Hence, equality, diversity and inclusion are ideals that we

should strive for. However, these ideals remain unreachable
if workers are subjected to discriminatory treatment at the
workplace. This makes it essential to look at the issue of
discrimination in more depth in order to understand its root
causes and its implicit and explicit manifestations.
Discrimination
Until the 17th century in the West, it was largely assumed

that human beings were not born equal and that nature itself
establishes a human hierarchy. With time, this idea was
challenged and the Enlightenment period stimulated the
great modern social movements which eventually led to the
declaration of human rights in the 20th century (Stanford
Encyclopaedia of Philosophy, 2007). In 1919, the International
Labour Organisation (ILO) was established with the specific aim
of overseeing treaties that protect worker rights and their health
and safety (ILO, 2007). The principles of equality of treatment
and non-discrimination were first officially enshrined in the
Maltese Constitution in 1964
Discrimination is not an exceptional or rare occurrence, and
the ILO (2007, p. 9) claims that it is a “systemic phenomenon
frequently embedded in the way in which workplaces operate
[and it is] rooted in prevalent cultural and social values and
norms”. Assuming that all workers are able to access the same
opportunities at work is a myth. At times, discrimination may
be so ingrained in work processes and work environments that it
may not even be noticed.
The lack of equality may be more easily determined by
establishing that discrimination has actually taken place. Legally
speaking, certain elements must be present in order to prove it.
To start with, a discriminatory treatment must be unfavourable
in relation to another worker in a comparable situation
(comparator). To be considered as discriminatory, the treatment
must be of an unjustified nature and so, is neither considered

objective, nor proportionally reasonable in its deliverance on a
protected ground. Proving that a person has been discriminated
(not treated equally and fairly) at work is not a straightforward
task either, and the discussion on equality and discrimination,
“in general is characterised by considerable conceptual and
methodological confusion” (McCrudden, & Prechal, 2009, p.1).
Managers have a legal and moral duty to ensure that
discrimination is not tolerated at the workplace and lack of
action to avoid it or stop it, can be viewed unfavourably in any
legal case. Recognising discrimination is a first important step.
However if the buck stops there, nothing much will be gained
unless corrective steps are taken in order to move toward the
concept of substantive equality which not only ensures equality
of opportunities but leads to equality of results (IWRAR, 2001).
The different grounds of Discrimination
Discrimination has many facets and targets many groups that

fall outside the ‘ideal worker’ or the mainstream typical worker,
in a given time and place.
For example, women generally suffer more because of sexism
and are more regularly discriminated at the workplace when
compared to men, due to the fact that they can, or potentially can,
get pregnant and have children. Likewise they are discriminated
in that society still assumes that women, but especially mothers,
will carry the biggest share of family responsibilities which
may conflict with their paid work (Correll, Bernard, & Paik,
2007; Williams, 2001; Acker, 1990). As a result mothers suffer
a ‘motherhood penalty’ that brings systemic disadvantages that
affects their pay level (Magro, 2018; Harkness, & Waldfogel,
1999), their perceived competence (Kahn, García-Manglano, &
Bianchi, 2014); their benefits (Crittenden, 2001), and their career
progression (Kunze, 2014) in comparison to men and women
without children. In direct contrast, the process of fatherhood
renders men to be more stable and responsible (Corell et al.,

2007) in the eyes of recruiters, and brings them more benefits
when compared to mothers.
Racism and xenophobia typically affect foreign workers who

are considered to be different to the mainstream ideal worker.
However, it has been noted that migrant women seem to face
more challenges because of their race (Chana Merino, 2017).
Discrimination on the basis of race can be based on external
factors like the colour of the skin or because a group is considered
to be inferior to another because they belong to a specific race or
ethnicity (Taran, 2002). Closely related to the issue of racism is
discrimination based on religion. This happens when people are
treated and valued differently because of their religious beliefs
and how they exhibit it at the place of work (Kumra & Manfredi,
2012).
The grounds for protection from discrimination covered by
Maltese law extend to other areas which go beyond gender and
race. However for the sake of brevity, these will not be discussed
in detail. These include protection on the grounds of: disability
(physical, intellectual sensory and/or mental impairment);
political opinion, membership in a trade union or employers’
association; age; marital status and pregnancy or potential
pregnancy. Since 2015, a new law also covers discrimination
on the basis of gender identity, gender expression and sex
characteristics. There are several other grounds on which people
are subtly, or at times overtly, discriminated which however are
not protected by law. For example, ex-convicts and ex-drug users
typically face more problems in finding work (Martin, 2015).
People who are obese, especially if they are women (Nickson,
Timming, Re, & Perrett, 2016) and people with visible tattoos
(Brincat, 2016) may also face more hurdles in accessing work.
Unfortunately, people who feel they are being discriminated on
any of these grounds have no means of redress in court.
Root causes of discrimination

The root causes of discrimination are complex and are the
result of prejudices we develop about certain categories of
people as we are growing up. Prejudices are socially constructed
and are influenced by our socialisation process and through
the interactions we have with our parents, relatives, friends,
teachers and through the media, including social media.
Prejudices are based on generalised assumptions or sweeping
statements, which tend to be negative, about those people whom
we consider to be different or incompatible with us, or with our
group (Kumra, & Manfredi, 2012). When this happens, we tend
to stop evaluating such persons on their own merits and instead
jump to quick conclusions about them. These assumptions are
not always based on facts and may be totally irrational; yet, they
are often used to justify prejudice (Crandall, Bahns, Warner, &
Schaller, 2011). Prejudices may also be driven by ignorance or
fear (Thompson, 2007), and by perceived competition for limited
resources (Baumeister, & Vohs, 2007). This often leads us to treat
people less positively than we treat those whom we consider to
be like us, and those who do not pose any threat to us.
Discrimination is often inflicted by the dominant group on
those who fall outside the ‘created’ and socially constructed
norm. Typically, the dominant group enjoys greater access to
decision making and wields more power and privileges. These
unearned privileges are embedded in our social system and give
unfair advantages over others. In the context of explaining white
male privilege, McIntosh (1990, p. 1) argues that white men are
the recipients of an “invisible, weightless backpack of special
provisions, maps, passports, codebooks, visas, clothes, tools and
blank cheques” that helps them move forward more smoothly
during their life journey. The rest start their journey without
these tools and with clear disadvantages.
Some people suffer from multiple or intersectional forms of
discrimination (Crenshaw, 1989) due to interrelating systems of
social class, race, gender, sexual orientation, age and disability,
amongst others. For example a Sub Saharan migrant woman

of Muslim faith trying to find work in Malta may find more
difficulties in accessing work due to the fact that she is a woman,
she is black, and she is a Muslim.
Direct and Indirect discrimination and its impact
Discrimination can be direct or indirect and may happen at the

entry stage into the labour market, whilst people are on the job
and even after they leave. Direct discrimination happens when
rules, work practices and policies give preference, or exclude,
certain individuals because they belong to a particular group.
For example, due to fear of increased absenteeism after having
children, fathers are generally preferred for the post of managers
over mothers (Rice, 2011). Likewise, people with names linked
to a certain race or religion, may be more likely to be sifted
out during the early short-listing phase and are less likely to be
called for an interview (Derous, Nguyen & Ryan, 2011). Indirect
discrimination is less obvious but this happens when apparently
neutral norms and work practices have a more negative effect on
one or more identifiable groups without justification (Kumra, &
Manfredi, 2012). For example, organising staff training over the
weekend or after work may exclude workers who may want to
attend, but who cannot do so, because of family responsibilities.
Discrimination may also come in a disguised form, like making
jokes about particular groups of people because of their religion,
or when making sexual innuendos about a colleague who is gay
(Di Marco, Arenas, & Munduate, 2018).
In order to avoid discrimination and to encourage equality,
inclusion and diversity, it is essential to adapt the work
environment for the different needs of people, ensuring that all
can work in spite of their differences. For example, employers are
expected to reasonably accommodate persons with disabilities
by facilitating their mobility or arranging their workspace in
ways that enable them to work better. Workers, especially those
with young children, may need more flexibility in relation to

time (reduced hours or job sharing) and space (working from
home or partly from work and from home at certain times). This
also applies to people caring for the elderly or those with long
term care needs. Flexibility is also important for older persons
and for people who are studying whilst working and for anyone
who is trying to combine paid work with other commitments.
Not doing so may mean that these categories of workers are
indirectly being discriminated.
Discrimination is never cost neutral: it leaves a negative
mark on the person and on society at large by hampering social
cohesion and solidarity. Discrimination is likely also to affect the
organisation in the long run and may result in expensive lawsuits.
For example, a Maltese woman was awarded €800,000 over
gender discrimination in 2012 (Times of Malta, 2012), whilst
the heirs of a former bank employee were awarded €603,000 for
unjust disciplinary action in 2016 (Times of Malta, 2016).
In the next sections I will use the grounds of gender and race
to highlight how discrimination is manifested within the local
labour market and will show how sexism and racism and the lack
of equality are hampering diversity and inclusion.
Gender (in)equality at work
Gender equality between women and men in Malta remains

elusive on many fronts and many gender gaps can be specifically
noted in relation to the participation, advancement and the
remuneration of women in the local labour market (World
Economic Forum, 2017).
Blatant discrimination against women has long historical
roots that cannot be erased overnight. For example, a law
enacted in Malta during the 1974 economic crisis, prohibited
women from filling posts vacated by men, and until 1976 it was
still legal to pay women less than men, even if they did the same
job. Furthermore, right up to 1980, the Maltese government
forced women working in the public sector (such as teachers,

clerical workers, nurses) to resign from their job once they got
married (Callus, 1992). Fast forward to the 21st century and the
legislator is still making gendered laws that treat women and
men differently. For example, mothers are allowed 18 weeks
of maternity leave whilst fathers are granted just two days of
paid paternity leave. Whilst acknowledging the health aspect
of childbirth linked to mothers, the disparity in maternity and
paternity leave, automatically diminishes the father’s caring role
in the family and reinforces the mother’s caring role. McIntosh
(2006) described this as an ‘interventionist approach’ which
directly perpetuates gender roles and gender stereotypes and
affects the participation rate of women and men differently.
The participation gap between the male and female
employment rates is 22.7% (NSO, LFS, Q1, 2018) and there are
clear indicators that traditional gender roles are still affecting
the decisions that women and men make in relation to paid
and unpaid work. For example, NSO, Labour Force Survey data
(NSO, LFS Q.1, 2018) shows that fewer than 20 men from the
whole inactive male population indicated that they cannot work
due to personal or family responsibilities. In contrast, 30,671
women (28.4%) claim that they are unable to take up paid work
because of these reasons (NSO, LFS, Q1, Table 20).
When looking at the different economic sectors,
these continue to be dominated by men except for Public
Administration, defence, education, human health and social
work, which are dominated by women (F=32,101; M=24,114).
The gendered career choices can also, to a large extent be
noted in the course choices being made by university students.
For example, the faculties of engineering, (F=23; M=88),
information communication technology (F=21, M=91) and the
built environment (F=77; M=122) are still largely dominated by
males. On the other hand and in line with traditional gendered
stereotypes, education (F=273; M=55) and health sciences
(F=260, M=93) are dominated by females (University of Malta,
2018). Progress can be noted in the faculty of medicine and surgery
where the number of female graduates has now superseded that

of males (F=135; M=111). England (2010, p. 149) argues that,
whilst women have “strong incentives to enter male jobs”, like
those in ICT and engineering, men have fewer motivations to
take on female-related work, especially those related to caring,
because they tend to be less valued and are paid at lower rates.
Hence getting more men to enter into the caring field may be
more difficult as things currently stand.
When assessing the vertical advancement of women in
the labour market by looking at the board composition of
both private and public sector organisations, big gaps can be
noted (Reljic, 2018). This is happening in spite of the larger
number of females who graduate from university, which may
indirectly suggest educational preparedness for such top posts.
For example, in private companies listed in the Malta Stock
Exchange (MSE), 91.5% of the board members are males. The
situation is slightly better in public and state boards, where
women occupy 32.2% of board memberships (Reljic, 2018).
However, on taking a closer look, these boards are also largely
gendered, in that where a majority of women on a specific
board predominate, these are largely linked to issues related to
children’s affairs: for example, the children and young persons
advisory board (10 women; 1 man), and the adoption board of
appeal (3 women; 0 men). This suggests that the ‘think manager
– think male’ (Schein, Mueller, & Lituchy, 1996) remains
pervasive when it comes to top posts in the boardroom. On
the other hand, women are still largely associated with family
and caring roles. This was confirmed by a study conducted
with people who occupy top posts in the private sector in
Malta (KPMG, 2015). The quantitative study revealed that both
women and men believe that the main factor contributing to
the underrepresentation of women in high positions is that they
assume more family commitments than men and secondly that
such posts are likely to be filled through informal networks,
which are more likely to advantage males due to the prevailing
old boys’ networks.
When focusing on the remuneration gap, women in Malta

are not only paid less because of entering certain specific sectors
linked to caring and education, but they also suffer a wage gap
when doing exactly the same job as men across all sectors.
This is called the gender pay gap (GPG) and is calculated on
the difference between the average gross hourly earnings of
male and female paid employees as a percentage of average
gross hourly earnings of male paid employees (NSO, 2018).
Based on 2014 data (Magro, 2018), the GPG across all different
sectors and occupations in Malta in 2016 amounted to 10.6%. In
certain sectors, the GPG is higher: for example, the difference
in wage between women and men working in the finance and
insurance sectors, jumps to 28.3%. To make matters worse, the
gap increases with education: women with a tertiary level of
education suffer a bigger pay gap than the average (18.7%) when
compared to men with the same level of education. Mothers also
suffer a motherhood penalty of 16.6% when compared to fathers
with dependent children (Magro, 2018).
A study by the European Institute for Gender Equality (2015)
shows an increasing unequal division of time spent by women
and men on unpaid work. This includes care work, domestic
tasks, chores and social activities. Since 2005, a sharp drop of
10.6 percentage points was reported in available free time,
meaning that women are now spending more time on care
activities and less on leisure, sporting or voluntary activities than
men do. This indicates bigger challenges for women to balance
their work with their personal life. This can also seriously affect
their career progression in that they may decline to go up the
career ladder for fear that they may not be able to cope with their
(assumed) heavier work load at home. Business ownership and
self-employment is also largely dominated by men and there
are fewer than 20 Self-employed women with employees in the
formal labour market (NSO, LFS, Q1, 2018).
These gender gaps in the Maltese labour market are not always
easy to explain and some appear more difficult to eradicate.
Some are the result of blatant sexism and discrimination against
women which seems to be widely tolerated, if not overlooked.

For example, a recent study (Carabott, 2018) suggests that
three quarters of female respondents had experienced sexual
harassment at the work place. Other gaps stem from the
gendered contract and the gendered division of work at home
which allows ‘unencumbered males’ (Acker, 1990) to invest more
in their careers and in paid work whilst mothers struggle with
both paid and unpaid work. Whilst some things are changing, it
is clear that overall men in the Maltese labour market continue
to enjoy occupational privileges that continue being denied to
women.
Discrimination is not restricted to the grounds of gender,
and in the next section I will delve into the issue of racial
discrimination in the local labour market.
Racial Discrimination in the Maltese Labour Market?
Since 2002, there has been a tenfold increase (1074 %) in the

number of foreign workers. The vast majority of workers (around
70%) come from EU member states and EFTA countries (F=41%;
M=59%) while 30% are Third Country Nationals (TCNs) (F=39%;
M=61%) (Jobs Plus, 2018). In the last decade, there has also
been a seven fold increase in the number of employed ‘irregular’
migrants (F=10%; M=90%). However, in spite of the increase,
overall their numbers are still relatively small and as at December
2017, there were fewer than 2,000 ‘irregular’ migrants, officially
working in Malta (Jobsplus, 2018).
Workers coming from the EU and EFTA countries are working
across a variety of sectors and are also taking up important posts
as professionals (17%); technical and associate professional
groups (14%) and even managerial grades (13%) (Jobs Plus, 2018).
This suggests that they are somewhat managing to integrate at all
levels of the labour market without many difficulties. The largest
cohorts of TCNs come from the Philippines, Serbia, Montenegro
and India: a third of these work in elementary occupations, such

as quarrying and construction (Jobs Plus, 2018). This raises
concern on their ability to fully integrate in the local labour
market and maybe indicate that they face more hurdles to do so
when compared to EU and EFTA workers.
The biggest problems however seem to be linked to migrant
workers and asylum seekers. Migrants coming from Africa
seem to suffer from the most evident forms of discrimination
on a regular basis, mostly because of their skin colour and
their religious beliefs (Pace, 2018). A Eurobarometer survey
carried out in 2015, found that 71% of the Maltese believed that
discrimination on the basis of ethnic origin was the highest
when compared to discrimination on the basis of gender (33%).
Nearly half of the Maltese (48%) believed that discrimination
on the basis of ethnic origin would place someone of a different
race at a disadvantage even if they had equivalent qualifications
(European Commission, Special Eurobarometer, 2015).
Discrimination to this category of persons comes in many
forms including verbal abuse, bad working conditions and lower
pay. Wage disparities were noted and a report by the Department
of Industrial and Employment Relations (2014) found that over
88% of Sub-Saharan African respondents said that their wages
were lower than those paid to Maltese nationals.
A study conducted with Asylum seekers in Malta found out
that only 54.2% of asylum seekers were gainfully employed for
at least six months of the year between January and December
2015. Furthermore, less than a quarter (23.6%) of the heads of
household, were employed full-time during the same period
(Caruana, 2016). This indicates clear problems in accessing work.
The African Media Association, which is an NGO representing
the migrant community in Malta, claimed that some migrants
were living here for more than 10 years “in poverty and in
limbo” (Martin, 2016). This is happening in spite of the fact that
employers are struggling to find enough workers.
A high 84% of the Maltese, linked immigrants with ‘dirty jobs’
and the fact that they were taking up this unwanted work, was
seen as positive. Concurrently, 75% thought that migrants were a

burden on the Maltese welfare state (Martin, 2018). Sub-Saharan
Africans who do not enjoy any form of protection do not have a
right to work and often have no option but to accept whatever
work they can find. They stand at the mercy of whoever offers
them work and they rely on the goodwill of the ‘casual employer’
to get paid. African migrants are often seen doing work which
the Maltese do not want to do. These include garbage collection,
road cleaning, construction work, dish washing, tending the
fields and setting up umbrellas on the beach in summer.
The Trafficking in Person Report (2018) suggests that
“approximately 5,000 irregular migrants from African countries
residing in Malta are vulnerable to trafficking in the country’s
informal labour market, including within the construction,
hospitality, and domestic sectors.” (Trafficking in Person Report,
2018). Severe forms of discrimination are not restricted to
African migrants, and in 2017, the police in Malta, “identified
30 foreign trafficking victims (35 in 2016) which included 24
Ukrainian labour trafficking victims (all from a single case) and
six female victims (four Chinese nationals and two Hungarian
nationals) (Trafficking in Person Report, 2018).
When it comes to Sub-Saharan migrants, it is evident that
they fall outside the ideal worker template and there is still a
lot to be done to break the mould of the white privileged, ideal
worker, who forms part of the dominant culture and religion.
Conclusion: Working towards an inclusive and fair labour

market
As argued earlier, a fair, inclusive and diversified workforce brings

several benefits to the workers, to the organisation and to society
at large. However this is more challenging than we think and will
not happen on its own unless the root causes of discrimination
are addressed at the micro and macro level. Discrimination needs
to be tackled by changes in law and changes to organisational
policies and work practices. More importantly there also needs

to be a change in culture. The challenge, of course, remains how
and from where do we start the change process.
A good place to start is by addressing our own outdated
assumptions we make on people who do not fit in the ‘ideal
worker’ template. Challenging norms and the status quo is
never an easy task. On the contrary resistance to change is
to be expected because of our biases and the prejudices we
have accumulated over time which are influenced by what is
happening around us and due to our past experiences.
For example, linking mothers to caring roles and men to
positions of power cannot be easily erased. This is likely to
continue to condition the way we look at women and men in
the labour market. In turn this will affect who between women
and men is more likely to make it to the top of the hierarchy
and to get a promotion or a better pay. We need to recognise
that challenging gender discrimination at work does not only
depend on what happens at the place of work, but is intrinsically
affected by what happens at home and on the type of gendered
contract agreed between the couple within the family. For
example, if men continue to refuse the share of burdens that
comes in the form of house chores and caring work, women
will always be disadvantaged. Or if the obligations of caring
are not legally imposed on both parents, let us say through the
creation of a fully paid parental leave quota for both fathers and
mothers, employers will continue to judge mothers and fathers
differently. Hence, change has to happen at multiple levels for it
to be effective enough to challenge the status quo and for people
to start changing their attitudes and assumptions about gender
roles at work and at home.
Much, also needs to be done on how we look at migrants
especially sub-Saharan migrants. Discrimination against
these people stems from multiple factors, and like gender
discrimination, goes beyond the work place. For example, the
fact that Malta is part of the EU immediately puts European
workers in a privileged position when compared to the rest.
This can be compared to McIntosh’s (1990) invisible backpack

of special provisions which make things easier for some whilst
creating inequality for those who are deprived of a European
citizenship. People do not get to choose on which continent they
are born and probably would travel through regular channels
if they could do so. So the mere fact that they are labelled as
‘irregular’ migrants puts them in a position of vulnerability. Not
giving them the basic right to travel and the right to work legally,
creates an ‘us’ and ‘them’ mentality and makes inclusion and
fairness a much more difficult goal to achieve.
Equality, diversity and inclusion will remain hallow words if
we do not understand the underlying reasons that lead us to look
and treat people differently. Understanding how easy it is to be
biased and discriminatory in our thoughts and in our actions
is just the first step. Change has to happen at the personal,
family, organisational and community levels for it to be effective.
Legislative changes also need to be made at the national and even
on the broader international level. Recognising and refusing to
tolerate abuse, discrimination and harassment around us is one
small step in honouring the fact that we are all born free and
equal in dignity and in rights.
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Education, Training and
Development
Joseph G. Azzopardi
Malta’s accession to the European Union in 2004 posed an

unprecedented challenge to the islands’ economic and industrial
base that involved a “shift from a labour intensive, highly
protected manufacturing industry to a knowledge-based capital
intensive industry, open to fierce global market competition”
(Azzopardi, 1995, p. 54). The human resource development
(HRD) implications of this challenge for policy-makers and
business leaders were presented while Malta was immersed in
intense negotiation processes meant to convince the European
Commission that it was a valid candidate, ready for full
membership in the EU (Azzopardi, 1995).
Explicit human resource challenges for Maltese business
leaders and policy-makers were both positive and negative.
The main positive challenge was that Malta and its economy
would be presented with fresh opportunities for growth because
of the easier access to a bigger market and to a free and open
competitive environment. The negative challenge posed a
problem that involved the development and provision of the
right human resource required for Malta’s economy to be able to
compete and to proactively exploit the opportunities for growth
and development in order to be able to compete in an open and

free market economy.
The implication of these two challenges for policy makers
involved the rethinking of the whole national education system
to be transformed from one that is geared to develop industrial
workers to one that is geared to develop knowledge workers. This
would involve a fundamental shift in the mind-sets of educators
and in the teaching methods used from being organisation or
teacher-centred to becoming learner-centred, enabling learning
approaches that provide for the development of creative thinking,
innovation and an entrepreneurial attitude towards work.
The inference for business leaders was the responsibility to
start investing in their own people and to provide the learning
climate needed for the development of a human resource that is
multi-skilled, flexible and able to pro-act in a fast changing and
fiercely competitive business environment.
This chapter revisits the extant literature and practices in
the field of HRD with a view to elicit lessons that can be learnt
from its evolution over the past 100 years. It is organised in three
sections. The first sets the scene and looks into past and extant
literature on HRD within the context of changing economic
and organisational realities. The second section presents the
author’s analysis of the changing business realities over time and
proposes his contribution to the HRD field in the form of the
Bureaucratic-Learning continuum. The third section places the
Maltese experience in this context.
Setting the Scene
In order to place human resource challenges and their

implications in context, we need to understand what is happening
around us: the realities of the wider environment within which
businesses and their work organisations are expected to perform
successfully through their people. One major reality is that
societies and their economies have changed drastically during
Education, Training and Development 143
the past four decades; and so has Malta’s social and economic
profile. We are witnessing the emergence of a knowledge society
that is fundamentally different from traditional industrial society.
Newstrom & Davies (1993, p. 333) describe the knowledge
society as one where
... the use of knowledge and information dominates work
and employs the largest proportion of the labour force.
The distinguishing feature of a knowledge society is that it
emphasizes intellectual work more than manual work; the mind
more than the hands.
Industrial society is characterised by large, mostly

multinational, corporations using tall and hierarchical
structures and rigid processes and procedures to ensure control
and compliance, mainly involved in producing standardised
products and services for the masses and employing industrial
workers. The knowledge society relies more on small-scale
product and service provision through the organisation of flatter
and leaner structures, emphasising flexibility and teamwork and
promoting commitment and a challenging mind-set, to ensure
creativity and innovation and thriving on diversity through the
contribution of knowledge workers.
An overview of the historical development of work
organisations and people management and development helps
us to better understand the roles of education, training and
development.
Ever since the inception of scientific management (Taylor,
1914), at the turn of the twentieth century, managers’ main
concern was how to ensure efficiency and high productivity by
capitalising on the power of the industrial worker and finding
the ‘one best way’ of doing a job. The organisation was seen as
a machine and managers or foremen were cast as the brains
seeing to the efficient organisation of simple and repetitive
tasks that would simplify and facilitate the duties of the workers
who were seen as just a pair of hands. Training was limited to
prepare workers to perform simple and repetitive tasks that
were easily measured and that therefore guaranteed a ‘fair day’s

pay’ to all. Weber (1922) further idealised this approach and
method through his concept of a legal-rational bureaucracy
that emphasised rules and competences within a hierarchy of
offices, recruitment based upon qualifications and office holding
and supported by expert training and a career ladder based
upon seniority and/or ability. This resulted in speed, precision,
predictability and impersonality. Figure 1 below presents the
main internal characteristics of the bureaucratic organisation
and the accompanying external market conditions.
Figure 1: Bureaucracy
Source: the author
Cities expanded because the growing business ventures

needed more human power to thrive. With the arrival of masses
of labourers and their families, apart from the development
and strengthening of the urban infrastructure, such as roads
and drainage systems, a number of social institutions also had
to be expanded and developed. Bigger hospitals needed to
be constructed to take care of the health of a growing urban
population; and more and bigger schools had to be built to take
care of the development of a human resource that would fit the
needs of the growing bureaucratic systems that were running
societies in general and work organisations in particular: the
industrial worker.
The main objective of the educational system was to prepare
people for a variety of roles in society by being taught how
to be good and obedient citizens, workers and members of

family groups. The educational system, therefore, focussed
on inculcating and promoting unquestioning and compliant
attitudes with respect to authority. Basic education was seen as
the provider of all the reading, writing and computational skills
people needed for the rest of their working careers. Training was
minimal and generally limited to preparing specialists in one
specific routine task that fitted the machine-like bureaucratic
organisation characterised by a hierarchical structure, rigid rules,
processes and procedures, strict compliance to those rules and
to the directives coming from above and involved in routine and
repetitive processes geared on producing standardised products
for mass consumption.
The first attempt at criticising scientific management and
bureaucracy at work came around in the late 1920s following
Mayo’s (1930) Hawthorne studies and the birth of the Human
Relations School that challenged the idea and the practice of
treating workers as simply a pair of hands or as appendages to
the heartless machine. The most significant outcome of Mayo’s
studies was that workers also have hearts, feelings and emotions
and that the success of an organisation depends on how they are
treated. Organisations started being seen as living organisms:
open systems that are in continuous interaction with the forces
of both their external and internal environment. Output and
productivity also depended on the way workers are treated and
therefore managers needed to learn what and how to motivate
people to work harder and better.
To cope with the changing realities of what was happening
around them - mainly high levels of turbulence and uncertainty
- organisations were forced to rethink themselves and to start
looking for alternative ways of organising and managing. Rigid
processes and procedures needed to be replaced by more flexible
systems supported by a less hierarchical chain of command and
flatter structures. Figure 2 presents the main features of a Learning
Organisation as an open system and the changing conditions of
the external environment within which organisations have to
operate. In order to become more competitive, organisations

needed to react faster and possibly come forward with innovative
ideas that translated into better and more competitive products
and services. The brains of the managers no longer sufficed
and many more workers needed to think and to do. Therefore,
people needed to challenge the established ways of doing things
in order to become more creative, innovative and competitive.
Figure 2: The Learning Organisation
Source: the author
This situation gave rise to a series of motivation theories (e.g.,

Maslow, 1943; Vroom, 1962; Herzberg, 1966) emanating mainly
from social psychologists. In particular, McGregor (1960)
proposed what he called Theory X and Theory Y as guiding
philosophies for managers to decide how best to motivate
their employees. Theory X fits the bureaucratic approach and
suggests that workers are inherently lazy and they need to be
closely supervised and controlled because, for them, work is
the necessary evil that provides them with money. Extrinsic
motivators are therefore needed for such workers to perform their
tasks. Theory Y, on the other hand, proposes a fresh approach
and guiding principle to people management: some people
may very well want and need work because work defines who
they are; managers need to find ways of winning these workers’
commitment to the objectives of their organisations and then the
means to liberate their abilities and to unleash their potential.
Intrinsic motivators are therefore more effective in capitalising

on the human potential and to maximise productivity. Figure 3
presents the two types of organisations responding and reacting to
completely different and opposing environmental conditions with
diametrically opposing internal organisational characteristics.
Figure 3: The bureaucracy versus the learning organisation
Source: The author
The implication of these developments for education is that

educators need to prepare individuals for a lifetime learning
process and equip the nation’s human resources with the ability
to perform and carry out their duties: not because they are
supervised and controlled but because they are committed to
their organisation’s objective. Learner-centred methods are
needed to liberate the individuals’ minds, to encourage them
to challenge existing processes and procedures and to involve
themselves in creative and innovative thinking.
The implication for training is that, as Drucker (1992, p. 269)
argues:
… the most urgent learning and training must reach out to the
adults. Thus the focus of learning will shift from schools to
employers. Every employing institution will have to become a
teacher.
A major shift was taking place: from a business world operating

within conditions of low competition and low change and,
therefore, stability and certainty, to conditions of high competition
and fast changes and, therefore, turbulence and uncertainty.
Businesses were obliged to transition from operating within the
comfort of an industrial society to the unknown realities of the
emerging knowledge society. More than ever before, organisations
started to feel the need to invest in training because their success
depended considerably on the knowledge and the abilities of their
workers to compete by adapting to fast changing conditions. But:
organisations may not know whether the money and resources
committed to training are indeed an investment.
The post-World War II period witnessed the introduction
of training within organisations (Torraco, 2016) that eventually
evolved into the training cycle that helped managers and
organisations design and implement training interventions in a
systematic manner. This training model addressed the effects of
scientific management that manifested themselves in a deskilled
workforce and dehumanising work practices that persisted for
at least two decades. The new orthodoxy obliged organisations
to identify their training needs, then design and implement, and
finally evaluate their training provision to ensure that they were
doing the right thing (ibid.).
In the 1980s, however, practitioners and researchers started to
question the validity and effectiveness of the systematic training
cycle which started to be seen as too simplistic and linear to
provide for the skills, competencies and abilities needed in a
world of business that was becoming even more complex and
sophisticated (Kenney & Reid, 1986; Taylor, 1991). Armstrong
(1993) warned that, in times of fast changing and uncertain
business realities, over-reliance on the systematic training cycle
might trap managers into a deficiency mode, always trying to fill in
the gaps by reacting to changing circumstances. Notwithstanding
these doubts about the effectiveness of the systematic training
cycle Salas et al. (2016, p. 74) propose what they call ‘the science
of training and development’ claiming that: “(1) properly designed
training works; and (2) the way training is designed, delivered,

and implemented can greatly influence its effectiveness.” Their
proposed scientific model of training and development is, however,
a more refined and sophisticated version of, but fundamentally
similar to, the systematic training cycle. This raises the question:
what and who is right? Should systematic training be retained; or
should it be discarded? Malone (2003, p. 76) distinguishes training
from development as follows:
Training is a planned and systematic way of improving a person’s
knowledge, skills and attitudes so that he or she can perform the
current job more competently … Development is the process of
preparing a person to take on more onerous responsibilities or
equip him or her for future promotion within the organisation.
The definition of development, however, is more complex

than that. The 1970s and the 1980s witnessed the advent of
organisational learning and action science (Argyris & Schon,
1978) as central to the development of people in organisations
and key to successful implementation of Human Resource
Development (HRD). McLagan (1989, p. 52) defined HRD as:
… the process of increasing the capacity of the human resource
through development. It is thus a process of adding value to
individuals, teams or an organisation as a human system. So
HRD is something that everyone does.
Learning was becoming more significant and central to

successful organisational performance in fast changing and
increasingly unpredictable business realities.
Recent decades have been dominated by the ‘learning-
approach’ to organisational development and HRD, promoted
by the advent of the ‘learning organisation’ (Senge 1991) in the
US and the ‘learning company’ (Pedler, Boydell & Burgoyne,
1989, p. 2; Pedler, Burgoyne, & Boydell, 1991) in the UK. The
latter defined the Learning Company as “an organisation which
facilitates the learning of all of its members and continuously
transforms itself ” (Pedler, Boydell & Burgoyne, 1989, p. 2).
“As early as 1969 … [Reg Revans] was arguing for the learning
organisation” (Kippenberger, 1997, p. 23) and proposing how
‘institutions learn’ in the context of unprecedented, fast changing,
market conditions:
We are trying to live with these rates of change, like runners
in a race trying to reach a finishing post that moves away from
them at an ever-increasing speed. If we say that we must adapt
to change of any kind by learning, then if our rate of learning, L,
exceeds our rate of change C we adapt; if it does not we fail. How
then do we learn? On what does L depend? (Revans, 1969, p. 10)
According to Revans (1977, p. 3): “Action learning is … a

social process, in which managers learn with and from each
other by supportive attacks upon real and menacing problems.”
In the same article, Revans emphasises the importance of using
managers’ experience as a source of learning. This net contributor
to organisational learning was popularised by David Kolb through
the publication of the learning styles inventory technical manual
(Kolb, 1976). Another important contribution - this time, on the
educational front – was Malcolm Knowles’ adult learning processes
or the andragogical model of HRD (Knowles, 1973). Knowles
challenged the traditional pedagogical processes used to teach
children and proposed alternative processes that are more effective
for adults ‘to learn’ rather than being ‘taught’. His contribution
to learning and HRD remains valid, as evidenced by the revised
editions of his work (Knowles, Holton & Swanson, 2015).
The discussion of the role of the training function in
work organisations is not complete without referring to the
contribution made by two Norwegian researchers in the early
1990s (Gooderham & Lund, 1992). In their attempt to confirm
or otherwise whether money spent on training was actually an
investment, they found out that the organisations researched by
them involved themselves in four main types of training: random
training, training for survival, training for improvement and
training for development. Only those organisations that trained
for development were considered as investing in their people.
Pedler, Boydell and Burgoyne (1989) proposed what they

called a ‘problem-solution-problem’ sequence of historical
events to explain the development of the role of training from
the 1950s through the 1990s (Figure 4).
Figure 4: A possible P-S-P sequence.
Source: Pedler et al. (1989, p. 5).
They further condense the realities of the late 1980s as follows:

… traditional approaches to increasing productivity and
effectiveness are no longer seen as adequate. Leaner staffing,
simpler structures, getting close to the customer, encouraging
autonomy and entrepreneurship, and the rest of the recent
prescriptions for corporate excellence, require the active
collaboration and involvement of the people in that organisation
as the key resource. No longer can these people be thought of
just as ’human resources’, they must increasingly be seen and
treated as ‘resourceful humans’ (Morris & Burgoyne, 1973).
To be resourceful humans, we need opportunities for learning
and developing, for extending ourselves, for increasing our
intelligence and capability. As Bob Garratt has recently pointed
out in The Learning Organisation (1987, p. 10): “Central to the
new ideas… is the notion that learning has become the key
developable and tradable commodity of an organisation” (Pedler
et al., 1989, pp. 4-5).
I prefer to reproduce the above citation in its original entirety

because it is central to the discussion so far and to the whole
debate on the present and the future of education, training and
development and to the strategic management and development
of people in work organisations today and in the future.
The 20 th century concluded the debate on training and
development with the emergence of knowledge management
triggered by Nonaka and Tackeuchi’s (1995) proposal of
‘the knowledge-creating company’. The term ‘knowledge
work’ had been coined by Peter Drucker way back in 1959
(Drucker, 1959); but knowledge management per se started
to gain popularity more recently. Jacobs (2017, p. 177)
describes how, during the past forty years, the scholarly
and the popular literature has reported the developments
associated with knowledge work and the concomitant issues
that relate to management and organisational behaviour.
These include:
the advent of the knowledge economy in the postindustrial
age … the emergence of knowledge intensive organisations …
the management and transfer of knowledge in organisations …
and the unique challenges of managing individuals known as
knowledge workers.
Along with knowledge management, the turn of the 21st

century witnessed the introduction of talent management,
defined by the Chartered Institute of Personnel and Development
(2016, p. 1) as follows:
Talent management seeks to attract, identify, develop, engage,
retain and deploy individuals who are considered particularly
valuable to an organisation. By managing talent strategically,
organisations can build a high performance workplace,
encourage a learning organisation, add value to their branding
agenda, and contribute to diversity management.
Another intangible resource that has gained popularity during

the past two decades is intellectual capital (IC). The origins of the
concept, just as in the case of knowledge management, can be

traced back to the second half of the 20th century (e.g. Penrose,
1959; Polanyi, 1966; Romer, 1990).
… [intellectual capital] is becoming corporate America’s most
valuable asset and can be its sharpest competitive weapon …
These ‘assets’ are hidden because they do not show up on the
balance sheet of companies. At the same time … many senior
executives realise that successful companies will be those who
do the best job of capturing, nurturing and leveraging what
employees know (Roos & Roos, 1997, p. 3).
In spite of the emphasis on intellectual capital as a ‘valuable

asset’, there is still no universally accepted clear definition.
Ulrich (1998) suggested the equation ‘competence times
commitment’ to define IC and Burr (2005) added control as
another key ingredient. Gupta and Azzopardi (2013, p. 183) have
proposed adding two other dimensions – creativity and culture
– “to develop a framework to help companies assess, build and
leverage their IC.” More recently, Gupta, Massa and Azzopardi
(2016, p. 438) developed a conceptual framework, arguing that
… the more volatile the industry is, the greater the need to
secure and capitalize on IC, and the more critical it is for firms
to adopt a flexible and adaptive organic culture that encourages
the creation and leveraging of IC.
These developments indicate that there is no one single and

universally applicable approach to the development of human
resources in work organisations. Choosing or prioritising between
systematic training, knowledge management, talent management,
intellectual capital and more recently psychological capital (Avey,
Luthans & Jensen, 2009) feels too impulsive and unscientific.
Managers would appreciate pointers towards the kind of
organisational structure that is best fit to promote the management
and the development of the right human resource. The hunt is on for
those established standards in HRD and methods of measurement
that can guide managers in the right direction.
Fitz-Enz (1984, 2009, p. 9), the father of HR metrics, argues

that
… the problem is lack of standards. … As metrics and analytics
grow, so does the need for standard definitions similar to
accounting’s generally accepted accounting principles (GAAP)
system.
Anderson (2017) presents a critical ‘insider’ account of the

developments in HR standardisation covering the UK’s Investors
in People (IiP), British Standards Institute (BSI), International
Standardisation Organisation (ISO) and American National
Standards Institute (ANSI). She highlights the dilemmas that
emerge when standardisation provides:
… a basis for efficient and consistent operational management
practices grounded in common, generally applicable institutional
norms…[but then] critics of standardisation suggest that
meta-standards serve to inhibit organisational flexibility and
innovativeness (Anderson, 2017, p. 330).
She therefore proposes a distinction between the traditional

‘rules-based’ HRD standardisation processes and ‘principles-
based’ processes (Figure 5).
She critiques the rules-based approach and challenges its
“predictive assumptions … [identifying] potential ‘decoupling
effects’ that can occur when ‘symbolic adoption’ of standards
leads to simultaneous non-adherence or ‘token adoption’”
(Anderson, 2017, p. 341).
The debate continues: there is a general acceptance of the
applicability of HR or people metrics; but human resources
cannot and should not be treated and measured like assets in
accounting. According to Tootell et al. (2009, pp. 386-387; 390):
HR measurement is about intangibles, and such disciplines

as HR accounting have attempted to measure HR in financial
terms with limited degrees of success (Pfeffer, 1997). These
findings indicate a lack of any generally accepted way of
accounting for HR, unlike other physical resources … What
this research indicates is the importance of developing relevant
HR measurement models while accepting variance between
industries and organisations rather than the strict adherence of
a universal model as occurs in accounting practices.
Figure 5: Rules-based and principles-based standards
Source: Anderson (2017, p. 334).
The challenge here is for managers to be aware of the internal

dynamics of their respective organisations; as well as of the
external environmental conditions and realities in order to
proactively place themselves in a position to construct their own
model of measurement. Like the people who constitute them,
organisations are unique and what works for one organisation
does not necessarily work for another.
The Bureaucratic-Learning Continuum
Changes in the economic and business environment have led

to a shift in managers’ mind-set; from seeing workers as parts
of the machine, to appreciating workers as active contributors
to the success of the organisation. Workers need to be happy
and fulfilled on and with their jobs in order to give their utmost,
perform efficiently and be dedicated to the demands of fast-
changing environmental conditions and increasingly fiercer
competition.
In reality, what is being managed are not human resources;
one simply does not manage people. What one tries to manage
is what workers can and are willing to do for the organisation.
What needs to be managed, therefore, is ‘human resourcefulness’.
Figure 6: The Bureaucratic – Learning Continuum
Source: the author

Figure 6 summarises the discussion and proposes a way

forward by presenting what I have come to call the ‘bureaucratic
– learning continuum’. The bureaucracy and the learning
organisation are seen as the extreme ends of a continuum. The
managers’ wise decision on how to approach the development
of the human resourcefulness of their company depends on the
nature of the company and the forces of the environment with
which they are interacting. The bureaucracy and the learning
organisation are not mutually exclusive. The wise manager needs
to strike the right balance along that continuum.
The real life situation of a particular company or organisation
may lie anywhere along this continuum depending on the unique
nature of the organisation itself and on the levels of competition
and change and their concomitant levels of turbulence and
uncertainty. Otherwise, as highlighted long ago by Burns &
Stalker (1961), different departments and/or functions of the
same company at any point in time may involve industrial
workers and knowledge workers.
Figure 6 provides a practical framework for managers and
business leaders to strike the right balance in managing and
developing their people’s resourcefulness. Not all organisations
need to capitalise on their human resourcefulness to the same
extent. Those that fall close to the bureaucratic end of the
continuum can afford to provide only basic training in routine
and repetitive jobs and generally can also afford high levels of
labour turnover. McDonalds is often cited as a typical employer
of this kind. Other organisations that operate in the gig economy,
for instance, are completely absolved from providing any kind of
training at all. Such organisations can be found along the whole
range of the continuum employing gig workers:
… in coffee shops and university lecture halls, farms, factories,
and as janitors cleaning offices at night. They work for low wages
as personal care attendants, dog walkers, and day labourers for
landscapers, and for high wages as managers of IT installations,
accountants, editors, lawyers, and business consultants
(Friedman, 2014. p. 172).
The same applies to precarious employment and to

organisations that are highly protected or monopolistic.
However, the higher the competition and the faster the rate of
change and, therefore, the stronger the reliance on knowledge
work and intellectual capital, the more critical the need to invest
in the development of the organisation’s human resourcefulness.
The main implication of this proposal for the management and
the development of people and organisations, however small or
large, is that there is no one right way of managing and developing
people and organisations that is universally applicable. HRM is
both art and science. Managers and business leaders need to
exercise discretion, and learn how to proactively create their own
home-made and home-grown model of people and organisation
management and development, guided by extant and distinct
environmental realities, given the uniqueness of each work
organisation. Such models may range from traditional personnel
administration and management (as practised for more than a
century since the inception of scientific management) to human
resource management (as proposed since the last four decades
or so) to a new approach to managing ‘human resourcefulness’
that nurtures talent, competencies, skills, capabilities (physical
and intellectual) and knowledge.
The Maltese context
How does Malta feature in this scenario? Zammit (2003,

pp. 244-248) presents an accurate historical account of the
development of vocational education and employee training
in Malta. He traces the beginning of formal employee training
through vocational education to the early days of British rule
when, in 1807, apprentices were hired by the Naval Commission
to develop skills related to the ship-repair and ship-building
industry in order to meet the specific requirements of the British
Navy. The formal regulation of the employment and training of
apprentices, however, had to wait until 1952 when the Industrial
Training Act “placed a new responsibility on employers to

invest in the training of their workers” (Zammit, 2003, p. 245).
Apprenticeships in Malta remained geared to provide for the
skills needed by HM Admiralty’s Dockyard and “[i]t was only
just before the looming departure from Malta of the British
Forces, that some locals started to realise that the future of the
Maltese economy would depend considerably on the ability of
the Maltese workers to learn new, marketable skills” (Zammit,
2003, p. 247). Baldacchino (1988, p. 64) explains how economic
activity in Malta (from the beginning of the 19th century through
to the two World Wars and up to independence in 1964) centred
largely on the needs of the British colonial administration and
how “employment opportunities fluctuated with the effect, not
of market forces, but of the exigencies of the military services.”
Baldacchino (1998, p. 275) further explains how Malta, like
other micro-states, “appear[s] better suited to, first, leapfrog
directly from an agrarian/subsistence to a service economy and
only then to industrialise as a consequence of tertiarisation.” The
implication here is that Malta has skipped the industrialisation
process as experienced by most of the industrialised world
and therefore also forfeited on the need to train and develop
its workforce in its repetitive ways. This further explains why
systematic training was not introduced in Malta in the 1950s and
the 1960s, as was the case of more developed and industrialised
countries (see Figure 4) as a response to skill shortages and
mismatches. Indeed, in the 1950/60s, Malta’s main response to
the challenges of decolonisation and the concomitant rebuilding
of its economy was mass emigration (Azzopardi, 2011, 2012).
The European Commission has described the situation in Malta
in 2018 thus:
Labour shortages are growing and skills mismatches persist.
A substantial share of the Maltese labour force still has low
qualifications, while the reliance on foreign labour to address
the labour skills shortages is increasing (European Commission,
2018, p. 7).
The European Commission had already drawn the attention

of the Maltese authorities in this respect in 2016. This assessment
triggered a survey on employee skills on a national level:
Ensuring that education is responsive to labour market needs,
reducing skills mismatches and labour shortages are key policy
priorities in the National Reform Programme of Malta for 2016.
… [which] highlights the need for a more structured approach
towards the analysis of skills gaps and skills shortages (Employee
Skills Survey, 2017, p. 4).
Does this take us back to the systematic training model of

the 1950/60s? The evidence shows that we may not even be
there yet. The survey gives us more insight into training and
development in Malta. One section is dedicated to ‘hard to fill
vacancies’. The employers’ reaction to this occurrence is very
indicative. Their first preference is to recruit workers who
are non-Maltese nationals (39.6%); the second is to increase
advertising and recruitment costs (24.7%); the third is to
increase salaries (23.3%); the fourth is to use new recruitment
methods or channels (22.6%); while increasing training for
existing staff comes fifth (22.1%) (Employee Skills Survey,
2017, p.41). Such a battery of responses suggests that training
and development are still not placing top on our employers’
agenda as a proactive approach to the management and
development of people. In the 1950/60s, we solved our
employment problem by resorting to mass emigration; in
2018, we are solving the problem by resorting to recruiting
foreign labour.
Research or statistics on adult learning or learner-centred
processes to develop our much needed knowledge workers
(Knowles, Holton & Swanson, 2018) in Malta is practically
inexistent. Much of what exists may deal with ‘adult education’
rather than ‘adult learning’; indeed, the two terms are used
interchangeably (Borg, Mayo & Raykov, 2016). The Adult
Education Survey (National Statistics Office, 2016) offers
statistics in terms of numbers of participants in formal
education, non-formal education and informal education; but
no information about andragogical learning processes to ensure

that the learning is effective.
It is encouraging, however, to note that the Ministry for Education
and Employment (2014, p. 2) has committed itself to recognise:
the challenges of an ever-evolving and competitive world …
[and to position] itself at the forefront to provide present and
future generations with the necessary skills and talents for
employability and citizenship in the 21st century.
To achieve this, a student-centred approach to learning and

education is being proposed:
In the next ten years, the Ministry will carefully update the
existing learning programmes and modes of assessment in both
general and vocational and training education. It will continue to
support the modernisation of our vocational system, particularly
in mainstream education, as well as support apprenticeship,
traineeship, work-based and work-placed learning initiatives,
in the context of lifelong learning (Ministry for Education and
Employment, 2014, p. 5).
Also encouraging is the establishment of the National Skills
Council in 2016, whose aim is “to first review the past and
present available skills within our labour work force and evaluate
the changes required to meet current and future need” (Ministry
for Education and Employment, 2016).
Conclusion
Effective education, training and development cannot be

achieved unless those responsible for the delivery are fully aware
of the realities of the wider environment.
The bureaucratic-learning continuum presented in this
chapter (Figure 6) provides a framework for managers and policy-
makers to contextualise their strategies and tactics, in order to
ensure that the provision of education, training and development
are congruent with the realities that surround them. In an ever
more complex world, there is no universally applicable model.
While keeping in step with EU recommendations and directives,

we need to pro-actively shape a locally constructed model that
works best for us. This is achieved by nurturing and capitalising
on our human resourcefulness.
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Industrial Relations and
Collective Bargaining:
Working with Trade Unions
Manwel Debono
In order to understand industrial relations in Malta, it is useful to

delineate their roots and the forces that shaped them into their
current form. Malta’s industrial relations system emerged under
the colonial rule of Britain and it was largely modelled after the
British tradition, in line with other important institutions such as
the civil service and the educational system. Indeed, “the earliest
Maltese trade unions date back to the late 19th Century when
the influence of the British Trade Union movement and the
Industrial Relations model started to dissipate in other countries”
(Grech, 2018). The first attempts at unionisation in Malta can be
traced to 1884, with the setting up of the first benevolent society,
the Società Mutuo Soccorso, which was originally called “Fitters’
Union”, and inspired by contemporary British trade union
activism (Baldacchino, 1990, p. 64; Campbell, 1992, p. 571). This
and subsequent societies aimed at creating funds to assist ill
or injured members and their families in case of the members’
death (Attard, 1984). While providing social assistance, these
societies, which were not supported by legislation, did not aim
to bring about changes in the conditions of employment or in
society at large at the time.
The oldest surviving union, the Malta Union of Teachers,

was set up in 1919. However, the establishment of the General
Workers’ Union (GWU), during wartime, in 1943, is credited to
be the start of modern/contemporary industrial relations, and
since its inception it established itself as the largest and most
powerful union in Malta (Fino, 1983). The union was formed
in the dockyard, which used to be Malta’s largest employer;
it was born in the context of the country’s transition from a
fortress economy supporting the British Empire to an industrial
and eventually self-sustaining country (Zammit, 1984). It
was a period characterised by considerable unemployment,
widespread unskilled work and cheap labour, and intermittent
social conflict (Attard, 1984).
The GWU was the major union that “pushed the need of proper
industrial relations machinery to the fore” (Attard, 1984, p. 16). Such
pressure contributed to the enactment of the Trade Unions and
Trade Disputes Ordinance in 1945, which included the registration
of trade unions and provided them with “immunity from actions
of tort in respect of any offence committed in contemplation or
furtherance of a trade dispute” (Grech, 2018). Subsequently, the
Conditions of Employment (Regulation) Act (CERA) was enacted
in 1952. While CERA was a labour law rather than an industrial
relations law, it provided a basic structure in which industrial relations
could take place over the following half a century, by providing,
among other details, a legal standing to collective agreements. It
also regulated a range of working conditions such as the protection
of wages, leave and unfair dismissal (Grech, 2018). Over the years,
the growth of employment in Malta led to more complex industrial
relations, increasing numbers of industrial actions, and questions
about workers’ rights and employers’ dues, indicating the need for a
new law (Attard, 1984). This led to the enactment of the Industrial
Relations Act (IRA, 1976), which consolidated the Trade Unions
and Trade Disputes Ordinance (1945) and the Conciliation and
Arbitration Act (1948), and provided a better framework to settle
disputes through the establishment of an Industrial Tribunal,
among others.
Industrial Relations and Collective Bargaining 167
Contemporary industrial relations takes place within the

general legal framework of the Employment and Industrial
Relations Act (EIRA, Government of Malta, 2002), which
replaced both CERA (1952) and IRA (1976). The act regulates
the setting up and conduct of trade unions and employers
associations. It also deals with the settlement of disputes. In
recent years, the act has increasingly been criticised for its
flaws, lacunae and potential for different interpretations, leading
social partners such as the Malta Employers Association (2014)
to propose changes to improve it. Some important additions to
EIRA have already been implemented, such as the Recognition of
Trade Unions Regulations (Government of Malta, 2016) meant
to facilitate the management of issues and disputes that may
arise in relation to trade union recognition at the place of work.
The generic nature of EIRA leaves considerable space for
trade unions and employers to set specific working conditions
and procedures within collective agreements, which are
legally binding, as long as they do not conflict with or propose
conditions which are lower than the minimum prescribed by
EIRA. The next section explores the changing composition of
trade unionism in Malta.
Trade union trends
The declared membership of Maltese trade unions has more than

doubled since 1977 (from around 39,000 to around 99,000); and
trade union density according to official figures has increased
from 36% in 1977 to 58% in 2017 (see Table 1). One should
note that these figures are not based on a time series and vary
according to which employment statistics one uses. Besides, a
survey carried out by Debono (2015) showed that the recent
membership figures might be grossly inflated, with the real
density being about half of what official data portrays.
Table 1 shows the dominance of the two largest general
unions, namely the General Workers’ Union (GWU) and the
Union Ħaddiema Magħqudin: Voice of the Workers (UHM) in

Malta’s trade union landscape. According to data compiled by
the Registrar of Trade Unions, half of all the unionised workers
in Malta are members of the GWU and a fourth are members of
the UHM. The GWU is a general union, and it has traditionally
focused on blue collar workers rather than white collar ones.
Apart from representing people in the dockyard, its strength grew
through the representation of workers within the manufacturing
sector. As the economy changed and the dockyard shed workers
and was eventually privatised while the manufacturing sector
shrunk, the GWU has managed to infiltrate into previously
non-unionised sectors, including some groups of self-employed
persons, and has continued to grow in membership terms. In
contrast, the UHM emerged from the merger of smaller unions,
mainly covering public employees, and developed into a large
general union as a reaction to the GWU, the latter having been
traditionally closely associated with the Malta Labour Party
(MLP). Many workers who did not wish to align themselves with
the GWU or the MLP, joined the UHM, which branded itself
as a “free trade union”. The UHM established itself as the main
union in Malta catering for the interests of white collar workers
(Baldacchino, 1988).
Despite the obvious dominance of the GWU and UHM, the
smaller unions composed mostly of unions representing specific
occupational or professional groups have been increasing in size
at a faster pace than the two general unions. This trend appears
set to continue as the workforce becomes more qualified and
specialised. Thus, in 2017, the smaller unions officially represented
23% of all unionised workers in Malta when compared to a much
lower 11% in 1987. The largest of the small unions are: the Malta
Union of Teachers (MUT) with 9,509 members; the Malta Union
of Midwives and Nurses (MUMN) with 3,699 members; and the
Malta Union of Bank Employees (MUBE) with 3,050 members.
Table 1: Trade union statistics in Malta, 1977-2017.
1977 1987 1997 2007 2017

109,707 117,362 137,719 143,578 152,265
Total employment
(June) (June)
Total 39,0921 60,8721 80,9721 88,7861 99,076
membership
(39,092) (59,568) (76,235) (79,656) (87,695)
(Excluding
pensioners)
Trade Density2 36% 51% 55% 55% 58%
Unions
Number of 37 21 34 31 30
unions
GWU 26,364 36,095 46,075 45,993 50,235
UHM 3,712 3
17,956 23,785 26,231 25,607
Share of GWU & 77% 89% 86% 81% 77%
UHM out of total
union membership
Sources: Grech (2003); National Statistics Office (2007, 2018); Department of Industrial
and Employment Relations (1978-2018)
1
Data includes additions by late returns
2
Excluding pensioners
3
Then known as Malta Government Employees Union (MGEU).
The trade union movement in Malta is divided into three blocks.

The largest one is the GWU which is sometimes categorised as a
confederation in itself, and has one recognised union affiliated to
it, namely the Police Officers’ Union. Together with the smaller
union, the GWU represented 52% of all unionised persons in
Malta in 2017. The second block is the Confederation of Malta
Trade Unions (CMTU) which was set up in 1959 and acts as an
umbrella organisation for the UHM and six other smaller unions.
CMTU represented around 30% of all unionised persons. Set
up in 2004, Forum Unjons Maltin (FORUM) is the smallest and
most recently formed confederation. It includes 12 unions and
represented 15% of unionised persons.
Young persons, persons in non-traditional employment
sectors, those working in small enterprises, in elementary
occupations (such as fisheries, quarrying, construction, waste

collection), persons with non-standard employment contracts
(including part-timers, those on definite and time-sensitive
contracts, and the self-employed dependent on a single
contactor), as well as foreigners are less likely to be unionised
than other workers in regular employment (Debono, 2017;
Debono & Marmarà, 2017). It is clear that in order to maintain
or increase their membership levels in the years to come, trade
unions need to pursue these groups of workers more diligently.
However, as highlighted by Zammit and Rizzo (2003), in their
efforts to update and renew themselves, trade unions need to be
careful not to alienate their core and loyal members who might
uphold more traditional values and an idealised vision of trade
unionism.
Having reviewed the major players in trade unionism in
Malta, the next two sections examine their roles.
The significance of collective agreements
The raison d’etre of Maltese unions has always been that of

protecting the interests of their members through collective
bargaining, leading to collective agreements and individual
assistance. This section investigates collective agreements in
Malta.
In most EU countries, collective bargaining takes place at
various levels, resulting in company, sectoral, multi-sectoral and
industry-wide agreements. In contrast, all collective agreements
in the private sector in Malta are carried out at company level.
Extension mechanisms of collective agreements which make
these applicable beyond the immediate contracting parties do
not exist. Social partners tend to be satisfied with this simple
system as, in general, they feel that the competitiveness of
individual enterprises would be under threat if whole sectors
are bound by the same wages and working conditions. The
only sectoral agreement in Malta is the Collective Agreement
for Employees in the Public Service, which was most recently

signed by government and seven unions in 2017 (Public Service
Malta, 2017). Such an agreement is complemented by a number
of sectoral agreements signed with trade unions representing
specific occupations in the public service, such as teachers,
pharmacists and medical doctors. The Industrial Relations Unit
forming part of the People and Standards Division within the
Office of the Prime Minister assists government ministries, state
departments and public sector entities in the bargaining process,
“to ensure that collective bargaining processes take into account
policies that reflect the industrial and employee relations
framework for government” (Public Administration Human
Resource Office, 2014, p. 94). Employer associations are not
directly involved in collective bargaining and are not signatories
to such agreements.
The structure of collective agreements in Malta is based
on a model agreement developed by the General Workers’
Union and the Malta Employers’ Association back in 1967
(Greenland, 2011). Collective agreements aim to provide stable
employee relations that are conducive to effective organisational
performance. Their objective is to maintain industrial peace
by providing good working conditions for employees and
regulating important procedural aspects in the management
of employees. Indeed, agreements normally include both
substantive and procedural aspects. The most important and
contentious substantive aspect has traditionally been wages and
other monetary benefits. The annual Cost of Living Allowance
(COLA), mandated by government since 1990, needs to be
factored into collective bargaining, as it further increases wages.
One should note that, over time and especially since the 2008
global financial crisis, trade unions have moderated their wage
demands, and increasingly focused on other work-related but
non-remunerated aspects in collective bargaining. Collective
agreements habitually cover important procedural aspects such
as discipline, career progression, absence from work, dispute
resolution and redundancies. However, collective agreements
covering the public service exclude such procedural details
which are found in the Public Service Management Code

(PSMC). Despite the stability of core topics within collective
agreements, other topics (such as work-life balance, medical
benefits, provisions for teleworking, and health and safety) are
increasingly finding their way in the more recent collective
agreements.
Whereas collective agreements in the private sector normally
last three years, those in the public sector have become longer,
culminating in the Collective Agreement for Employees in
the Public Service spanning eight years, from 2017 to 2024.
The different duration of agreements reflects the varying
realities and needs of the respective organisations and sectors.
Employers and trade unions normally refrain from trying to
change working conditions or employment procedures affecting
employees during the duration of collective agreements. Thus,
the slower rate of change experienced in the public sector
facilitates collective agreements with a longer duration, since
these may promote continuity and reduce the potential for
industrial disputes. On the other hand, employers in the private
sector may prefer to keep agreements spanning three years, as
longer agreements might increase their difficulties to adapt to
fast changing organisational needs. Note that, when collective
agreements are not renewed, they remain valid beyond their
expiry date.
Collective agreements are the result of the most important
system of employee participation in Malta, which takes place
through the representation of trade unions. “Maltese industrial
relations are based on the British model where shop stewards
are the main link between trade unions and management.
Shop stewards are thus the core element of the Maltese idea
of employee participation in the workplace” (Debono, 2004,
“Commentary”, para. 2). There is no tradition of representative
bodies at the workplace such as works councils, and due to the
small size of Maltese organisations, European Work Councils
(EWCs) are virtually non-existent; the only known case of a
Maltese-owned firm with overseas subsidiaries that operates an
EWC is the Corinthia Group of Companies (Baldacchino, 2009).

Other types of participation such as employee representation on
company boards, are rare: after a spurt of ‘worker directors’ in
the 1970s (Zammit & Baldacchino, 1989), only three employee
directors appear to be still in place: one each on the boards of
two companies owned by the GWU, and one on the board of
a company owned by the Labour Party (Fulton, 2015). Thus,
apart from setting the rules for the proper conduct of both
employees and management, collective agreements are also
the major tool of democratisation of workplaces in the country.
Considering the importance of collective agreements, it is of
concern that research into such agreements is scarce: Greenland
(2011) and Montebello (2003a) are notable exceptions. Such
agreements are private contracts between parties and might
contain commercially sensitive information; and so, access to
collective agreements held at the Department of Industrial
and Employment Relations (DIER) has to-date been restricted.
Thus, unlike what happens in other EU countries, researchers
in Malta are unable to clearly capture emerging trends in such
agreements, and good practice is rarely made public.
The coverage of collective agreements in Malta is strong but
on the decline. Given that practically all employees in the public
sector are covered by a collective agreement, half of the Maltese
workforce has its working conditions secured by collective
bargaining. All these workers earn more than the statutory
minimum wage. However, Baldacchino and Gatt (2009) report
that, over a 13-year period (1995-2008), the number of private
sector collective agreements has shrunk by a fifth, from 212
to 168, while the coverage rate decreased by 6.2 percentage
points, from 32.9% to 26.7%. In line with such findings, the
number of collective agreements registered annually with the
DIER (including new agreements, renewals, extensions, side
agreements and amendments) decreased from 47 between 2001
and 2009 to 34 between 2010 and 2017 (DIER, 2002-16; Ministry
for Social Dialogue, Consumer Affairs and Civil Liberties, 2017;
Ministry for European Affairs and Equality, 2018).
The overall decline in collective agreement coverage can

be attributed to a number of factors. There is the shrinking of
employment in industrial sectors that are traditionally more
unionised, such as ship repair and manufacturing. There is the
growth of service sectors such as financial services and i-gaming
which have adopted a unitarist, strategic human resource
management stance in which trade unions have been unable
to penetrate. And there is the growing number of younger
workers who appear to uphold more liberal and individualistic
world views and are therefore less interested in unionisation or
collective representation (Montebello, 2003b).
Collective agreements in the private sector are also related
to company size. While around 72% of employees in companies
employing 250 persons or more are covered by collective
agreements, the percentage decreases to a mere 4% among those
working in companies with less than 10 employees (Debono,
2015).
Other roles beyond collective bargaining
Apart from carrying out collective bargaining, trade unions often

deliver other services to their members, and sometimes play
other roles at a macro level. The spectrum of services offered
to members and other social engagements vary considerably,
depending on the size of the unions and the specific needs of
their members. As expected, the larger unions, which are better
organised and funded than smaller ones, tend to be more active
at both the micro and macro levels.
Trade union members in Malta often seek their union for
assistance on individual issues (Debono, 2015). Trade unions,
especially through their shop stewards, tend to be actively involved
in facilitating the relations between employees and management.
Several unions offer free legal help when required. Unions are
also often involved in educating, training and raising awareness
of their members. This is done both informally and formally.
Unions often teach their members about their rights and offer
career guidance at an informal level. While most trade unions
also hold conferences and training events for their members,
the larger unions have more organised training programmes.
Thus, the GWU has an educational branch called Reggie Miller
Foundation which organizes training courses in collaboration
with stakeholders such as Malta’s public employment services
organization and the University of Malta. The UHM also
organizes courses through its Salvinu Spiteri Foundation. Most
unions provide information to their members (and sometimes
to the general public) through websites which may include news
archives, press releases, articles, and information about training
opportunities. Among the several publications of the MUT, one
finds an academic journal, called The Educator, running since
2013, which publishes research in the field of education and
promotes critical debate on educational matters (MUT, 2018).
Many trade unions in Malta are very small: a minimum
number of seven members, of whom only the majority need to
be workers, is enough to set up a trade union. Such small unions
tend to carry out their operations through volunteers or part-time
staff. They are mainly funded through memberships and operate
almost exclusively to service the interests of their members at a
company or individual level. A handful of top executives are often
responsible for almost all the operations of such unions, and they
do not have the time or resources to go beyond servicing their
members. Nevertheless, most of these unions are represented
on a number of national and international fora through their
respective national confederation. On the other hand, the larger
unions, a few of which have substantial sources of revenue apart
from membership fees, tend to play a more visible role through
their involvement and affiliation in social dialogue at a sectoral,
national or international level.
Social partners, including trade unions, wield considerable
influence on the design of policies and reforms in Malta,
though they tend not to be involved in their implementation.
Subsequent governments have strengthened the involvement
of social partners in important decisions that affect the country

by setting up tripartite institutions such as the Malta Council
for Economic and Social Development (MCESD). Important
government policies and strategies like the annual budget, which
used to create great concern among social partners, are nowadays
discussed within MCESD: the represented social partners provide
government with suggestions that are sometimes taken on board.
Social partners, including trade unions, are also represented on
other entities such as: the Employment Relations Board (ERB)
which is consulted on matters relating to employment law;
Jobsplus, Malta’s public employment service; the Occupational
Health and Safety Authority; the Gozo Regional Committee; and
the Building Industry Consultative Council.
The GWU and the UHM are the only two trade unions
directly represented on the MCESD, while most of the other
unions are represented through CMTU or FORUM. The GWU
and UHM, operating at a cross-sectoral level, are arguably
better placed to exert pressure on the government than the
other unions. As an example, in 2012, the UHM proposed a
set of policy proposals meant to improve the flexibility and
productivity of the Maltese labour market; this was endorsed
by the major social partners and political parties before the
2013 general election, and later adopted by the new Labour
government. Social partners operating within specific sectors
also visibly influence government strategy in their respective
sectors. Professional unions – such as the Medical Association
of Malta, the Chamber of Pharmacists and the Malta Union of
Teachers – have significantly shaped policy in their respective
fields through their strong presence at a sectoral level.
In the absence of consultation on the initiative of the
government, trade unions, especially the larger ones, use other
methods to influence public opinion and government policy.
This is done through a variety of ways such as policy papers,
research reports, press releases, conferences, seminars and
participation in mass media. The GWU also publishes two
national newspapers, a daily L-Orizzont and the weekly it-
Torca, together with a digital portal called iNEWS, to deliver its

message.
Over the years, trade unions have also been able to mobilise the
public through campaigns and mass activities. Disagreements on
national policy sometimes led unions to organise public protests,
such as the 2008 demonstration against the government’s plans
to increase energy tariffs which included the participation of 20
unions (Debono, 2009). More recently, the GWU organised a
successful campaign against precarious employment (European
Commission, 2016), which led to an increased awareness about
the problems associated with such a phenomenon (Debono
& Marmara, 2016) and may have contributed to a change in
government in 2013. On its part, the UHM was among the social
partners that took part in mass protests against corruption and
in favour of good governance in 2016.
The larger unions also play a role at EU and international
levels. Several unions are affiliated to foreign organisations.
Unions are asked to contribute to the European Semester, a
cycle of economic and fiscal policy coordination within the
EU (European Foundation for the Improvement of Living and
Working Conditions, 2016). However, due to limited resources
and expertise, such participation tends to be contained.
Having given an overview of the various roles of trade unions,
the following section discusses the evolving trends in trade
disputes and their resolution.
Trends in industrial disputes and their resolution
Trade unions have traditionally used the right to strike and carry
out other industrial action as key negotiating tactics, both in
the private and public sector. Since the country’s independence,
industrial action peaked in the early 1970s, with strikes ordered
by the GWU at the Dockyard (Baldacchino, 2009). However, the
longest strike involved medical doctors and lasted 10 years, from
1977 to 1987 (German, 1991). Sympathy strikes are permitted in
Maltese law. Thus, a person who is not a trade union member

may still take part in a lawful strike without incurring any liability
(Zammit, Debono, & Brincat, 2015). However, when sympathy
strikes involve organisations or groups of workers not directly
affected by the cause prompting the strike, they tend to be
viewed particularly negatively by employers and society at large,
as happened in the national public transport strike of 2008 held
in sympathy with hearse operators who were protesting against
the liberalisation of their sector (Malta Independent, 2008).
The annual number of strikes has fallen consistently since the
1970s, with a corresponding decline in the number of days not
worked (see Table 2). Such a decline is more impressive if one
takes cognisance of the fact that the number of employers and
unionised workers has grown considerably over the same period.
Table 2: Strikes and work days lost, 1967-2017.
Annual average
Years
Number of strikes Work days lost per 1,000 employees
1967-1969 15 42
1970-1979 34 42
1980-1989 14 10
1990-1999 11 5
2000-2009 7 3
2010-2017 2 1
Sources: Attard (2010); Department of Industrial and Employment Relations (2002-16);
Ministry for Social Dialogue, Consumer Affairs and Civil Liberties (2017); Ministry
for European Affairs and Equality (2018).
The reduction of strikes over the years appears to have

been influenced by a gradual decline in the so called ‘militant’
attitudes of trade unions, in particular the larger ones which
traditionally set the tone for trade union action in Malta.
Dialogue and cooperation appears to be increasingly preferred
over confrontation. This change in attitudes arguably grows from
a realisation that the past tools to solve the emerging friction

with employers might not be the most effective ones nowadays.
Some notable cases of strikes leading to disastrous outcomes
for trade unions – as with the 1990 Phoenicia Hotel dispute,
with 158 workers dismissed (Baldacchino, 2009; Grixti, 1994)
– increased the awareness of the unintended consequences of
disruptive actions in the private sector, thus contributing to
diminish the number of strikes there. On the other hand, the
public sector continues to be affected by targeted and typically
short-term industrial action (even if often resulting in limited
actions, such as overtime bans); here, trade unions may feel
that they can apply pressure without damaging the interests or
livelihoods of their members.
Over the years, the proactive approach of the DIER has
played a significant role to settle trade disputes before they
escalate in industrial action. Table 3 below shows a constant
highly successful rate of interventions by the DIER, averaging
83% between 2001 and 2017. However, one also notices a general
decline in the mediation and conciliation interventions of the
DIER, in line with the trend of diminishing disputes.
In Malta, over the last 25 years, successive governments
have normally involved social partners and other relevant
stakeholders when taking important policy decisions regulating
employment (European Commission, 2016, p. 25), and in general
have tried to avoid acting unilaterally. While social dialogue at
a national level may not affect industrial relations at company
level directly, its steady improvement over the years has created
a more harmonious industrial relations climate in the country
(Debono & Baldacchino, 2019).
Table 3: Settlement of trade disputes by the Department of Industrial and Employment

Relations, 2001-2017.
Mediation/
Conciliation Agreement Success Rate
Year Interventions reached (%)
2001 68 49 72
2002 102 85 83
2003 70 54 77
2004 55 44 80
2005 59 49 83
2006 72 60 83
2007 56 47 84
2008 62 54 87
2009 62 55 89
2010 54 45 83
2011 78 68 87
2012 56 49 88
2013 57 47 82
2014 37 27 73
2015 37 32 86
2016 34 29 85
2017 25 18 72
Total 984 812 83
Sources: Department of Industrial and Employment Relations (2002-16); Personal
communication with the Department of Industrial and Employment Relations.
Having examined various ways in which trade unions impact

society, also through the use of industrial action, the next section
sheds light on how unions are viewed by the Maltese public,
including trade union members themselves.
The perceived utility of trade unions
While trade unions in Malta do not appear to be suffering from

a crisis of legitimacy, they are experiencing some erosion of
confidence in their image (Debono, 2017). In 2003, 89.7% of
union members believed that unions are still very much needed
in society (Zammit & Rizzo, 2003); in 2017, 79.2% declare that
trade unions play an important role in protecting worker’s rights,
and 75% say that unions play an important role in contributing
to national debates (Debono, 2017).
The work carried out by trade unions at macro and micro
levels elicits different responses. On one hand, trade unions are
still viewed as playing important roles at a macro level in Malta
(Debono, 2015). Their contributions through policy proposals,
demonstrations and other actions that maintain a media presence
are more visible than activities at company level, and appear to
be leaving an overall positive effect on how they are perceived by
the general public. On the other hand, union work at company
level appears not to be well promoted, resulting in a lower level
of confidence about trade unions’ role in offering individual
services to their members. Besides, while 60% of union members
are satisfied with the work undertaken by trade unions, the figure
decreases to 42% among non-unionised employees (Debono,
2017). Women also tend to be significantly less satisfied with
the work of trade unions than men, which might indicate that
unions are not sufficiently geared to provide for their specific
needs. Out of the respondents who are dissatisfied with the work
of trade unions, the majority (53%) believe that unions do not
truly help or provide for the needs of employees, while just over
a fifth (22%) opine that trade unions are untrustworthy because
they are politically partisan (Debono, 2015).
In 2003, most trade union members (70%) believed that
trade unions should look after the interests of their members to
obtain the best working conditions, rather than strive to ensure
that social justice prevails (Zammit & Rizzo, 2003). “The value of
solidarity that traditionally acts as a unifying force among workers
may not be highly esteemed by Maltese trade union members.

Rather than pursued as an intrinsic value, solidarity tends to be
regarded as a means to secure instrumental values” (Zammit &
Rizzo, 2003, p. 151). This attitude appears to have persisted over
the years. Trade unions seem to be mostly valued on instrumental
grounds, on whether individuals may personally benefit out of
them. Thus, according to Debono (2015), the main two reasons
for joining trade unions are: to be protected from discrimination
in relation to dismissal, overtime, promotions and access to
other benefits (reported in 40% of responses); and to maintain or
improve working conditions, including pay (28%). It comes as no
surprise that the majority of unionised employees admit having
sought personal help from trade unions (Debono, 2015).
When non-unionised respondents were asked to give the
reasons for not being a trade union member, the large majority
(62%) stated that they are not interested or that they do not need
a trade union (Debono, 2015). Such rationale aligns with the
earlier discussion about the instrumental utility of trade unions.
These responses are common among young persons. Such a lack
of appreciation (or belief in the utility) of trade unions by young
persons has been documented in different countries (e.g. Bulbeck,
2008; Turner and D’Art, 2012). Another fraction of respondents
state that they are not unionised because they do not have a trade
union at their workplace or because they are unaware of the
benefits of union membership (reported in 8% and 4% of responses
respectively). These responses highlight the significance of trade
union presence at the workplace through shop stewards. The
unions’ presence on mass media does not necessarily translate
into membership if unions are not present within companies.
It is unclear whether the dilution of the traditional adversarial
relationship between unions and employers, which was discussed
earlier and had already started to be observed over a decade ago in
Malta (Zammit, 2006), has negatively affected employees’ interest
in unions. However, “the workers’ instrumental basis for union
membership and their attitudes in favour of unions are inversely
correlated with their working conditions” (Debono, 2017, p. 7).
Thus, if workers value unionisation just for their own individual

benefits, when they have good working conditions they might not
be interested in becoming or remaining unionised.
Conclusion
Trade unions have traditionally been an important social force

in Malta, impacting society in various ways and at various levels.
Such influence has been facilitated by an enabling environment
sustained by governments, high membership figures and a strong
social standing. Indeed, for several decades, collective agreements
provided the framework through which most employee/
management relations took place. Trade union strategies are
also changing, with unions becoming more disenchanted with
the pursuit of strikes in their dealings with employers, while
focusing more on social dialogue at a national policy level. At
the same time, despite their growing membership numbers and
overall density over the past forty years, there appears to be
a gradual erosion in the unions’ ability to carry out collective
bargaining, as shown by the still strong but shrinking coverage
of collective agreements in Malta. The challenges brought about
by widespread socio-economic changes require a thorough
re-examination of the unions’ aims and strategies. Inter-
union collaboration would help them confront such common
challenges via capacity building, but this has not materialised.
Indeed, even employers have been “increasingly concerned
about the aggressive rivalry and conflict that at times borders on
animosity” among trade unions (MEA, 2015, p. 9). The setting up
of a National Forum of Trade Unions in 2014 by the President of
Malta, in collaboration with the Centre for Labour Studies at the
University of Malta, was one attempt at creating an all-inclusive
national platform for trade union dialogue (Times of Malta,
2014). And yet, given their divergent histories and competing
agendas, the different trade union blocks in Malta have much to
improve in their relations with and trust in each other.
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International.
Creativity, Entrepreneurship
and Innovation
Leonie Baldacchino
A more competitive business environment presents top

management with two clear options ... Ride out the storms and
hope for a better tomorrow (or) realise the need to do things
differently (Goodman & Dingli, 2017, p. 86).
In Malta as much as elsewhere, businesses operate in a rapidly

changing environment and face a steady flow of challenges
that include advancements in information and communication
technologies, changing customer needs, unstable markets and
harsh competition. In such an environment, many organisations
are becoming increasingly aware that the route to survival
and success is not about resisting change and hoping for a
better future but about embracing (and often instigating)
change by doing things differently. This requires the adoption
of a “strong entrepreneurial approach to innovative activities
and encouraging employees to become intrapreneurs” (Tidd
& Bessant, 2011, p. 197) by harnessing the creativity of each
member of the organisation and engaging in “a serious and
strategic pursuit of innovation” (Goodman & Dingli, 2017, p.
110).
Maximising creative potential: three reasons
The aim of this chapter is to enable those responsible for

managing people in Malta to adopt such an approach so as to
maximise the creative potential of their workforce and the
innovative capability of their organisation. This is of relevance
for at least three reasons.
First, although it is widely understood that creativity and
innovation are key success factors, most business leaders possess
insufficient understanding of how they occur, and are dissatisfied
with their organisation’s ability to innovate (Silverstein, DeCarlo
& Slocum, 2005).
Second, creativity and innovation ultimately depend on the
individuals and teams involved (Segal, 2006) and on the people
who manage them. As Tidd and Bessant (2011, p. 99) argue:
In a knowledge economy, where creativity is at a premium, people
really are the most important assets which a firm possesses. The
management challenge is how to go about building the kind of
organisations in which such innovative behaviour can flourish.
Third, the absence of natural resources often forces small

states such as Malta to rely heavily on their human resources
to generate wealth (Baldacchino, 1995). Maximising the creative
potential of the local workforce is, therefore, of particular
importance in the Maltese context, where natural resources
are limited to limestone deposits and sea salt. Citizens of small
states must be creative, flexible and adaptable to what is available
in order to survive and prosper (Sultana, 2006). The Maltese
have been described as having a “creativity spirit” coming from
the fact that they “had to survive on a rock without any natural
resources” (Mercieca & Cassar, 2006, p. 9).
Creativity, Entrepreneurship and Innovation 189
This chapter
This chapter is based on the widely-held views that: (1) creativity

is a skill that all humans possess and that can be nurtured and
improved, given the appropriate conditions; (2) employees in
all roles and at all levels of an organisation are a crucial source
of creativity and innovation; (3) innovation is a process that
needs to be managed in an ongoing manner; and (4) creativity
and innovation are closely linked to entrepreneurship and
intrapreneurship, both of which are required for organisational
success.
This chapter proceeds by defining creativity, innovation,
entrepreneurship and intrapreneurship, and elaborating on the
link between them. It then discusses several conditions that are
necessary for creativity, innovation and entre/intrapreneurship to
flourish within an organisation, including acceptance of risk and
failure, trust, time to think, top-down support, communication,
and financial support. The next sections discuss issues related
to motivation and rewards, and managing innovation. A brief
conclusion brings this chapter to a close.
Creativity and Innovation
When you ask a person ... about creativity, she may tell you that
creativity is associated with the arts such as literature, painting,
drama, music, sculpting, cooking, home decorating, and so on.
Question another, and he may say creativity is connected with
new discoveries in science, technology, and medicine. Speak
with their corporate counterparts, you discover that creativity
is involved in entrepreneurial business start-ups, strategy
development, and retooling for greater customer satisfaction,
performance and productivity (Segal, 2006, p. 2).
In general terms, creativity is defined as the generation of ideas

that are new and useful, or the combination of existing ideas
in a new way; it is associated with outcomes that are original

and valuable (Amabile et al., 1996; Goodman & Dingli, 2017).
Creativity is a skill and a “condition of our species” that is “natural
for just about everyone” (Segal, 2006, pp. 1, 4), in the sense that
everyone is born with the potential to be creative (although
to varying degrees). It is prompted by a human desire for the
betterment of one’s life-world, such as making it more beautiful,
meaningful, enjoyable, or comfortable (Segal, 2006). Engaging
in creative activities makes us feel that we are living a happier
and more fulfilling life; not only by removing negative elements
but also by offering positive goals and exciting models for living
(Csikszentmihalyi, 2013).
Different people attribute different meanings to the term
‘creativity’. Many associate it exclusively with the arts and
are surprised when they are told that creativity may be found
in many different domains, including business. Others agree
that creativity is important in business but believe that it is
solely the remit of those who work in the creative industries
or creative departments of organisations, such as design,
marketing or advertising. Creativity does play an important
role in such contexts, even in Malta (Bonello, 2015; Demicoli,
2016; Falzon, 2015); yet creativity is relevant to all kinds of
departments, organisations and industries. An important step in
maximising the creative potential of employees is to clarify their
misconceptions about its nature and role in their organisation.
In business, creativity underlies innovation, which refers
to the practical application or successful implementation of
creative ideas in organisations (Amabile et al., 1996; Lumsdaine
& Binks, 2007). Although the terms creativity and innovation
are often used interchangeably, they refer to related but distinct
phenomena. Creativity is the first stage in a process that may (if the
conditions are right) lead to innovation (Martins & Terblanche,
2003). An important difference between the two relates to their
locus and timing: creativity originates in the mind of individuals
and is required in the early stages for the “initial spark of creative
activity” (Goodman & Dingli, 2017, p. 117) and throughout the
process for ongoing problem solving efforts; innovation takes

place later and usually requires the involvement of a team (for
idea development and implementation), followed by broad
dissemination and acceptance across the whole organisation and
beyond (Lumsdaine & Binks, 2007).
Creative ideas may be implemented in organisations to
introduce innovative products, services, processes, systems,
policies and work spaces. Innovation may also be derived from
changes to the business model: “the who, what, when, where,
why, how and how much of providing goods and services” (Tidd
& Bessant, 2011, p. 184). In business settings, creativity and
innovation are not about being different just for its own sake;
but about being better than current available options. In other
words, innovation is “not an end in itself; it needs to be driving
useful and practical change, of benefit to the community funding
the innovation” (Greene, 2003, p. 86). It must have an impact
on the bottom line and add value in terms of profit, time, cost,
output or effort (Man, 2001).
Some believe that an implemented idea must be new to the
world in order to be considered innovative; but, in general, if
an implemented idea is new to the context (such as a country,
organisation or department) in which it is introduced, it may
also qualify as an innovation (El Murad & West, 2004; Martins
& Terblanche, 2003). The difference would be in the degree of
innovativeness, or whether it would be classified as a radical or
incremental innovation. If a totally new or significantly different
concept is introduced, such as a breakthrough technology or
revolutionary business model, then it is referred to as ‘radical’.
However, if the innovation involves only a minor improvement
or upgrading of something that is already in existence within
a specific context, then it is referred to as ‘incremental’. Both
forms of innovation have their advantages and disadvantages.
Incremental innovation, in the form of “me-too” or “trend-of-
the-moment” products, provides low financial return and has
a short market life; it is only “truly innovative and radically
new products” that offer “totally new perceived benefits” to
customers and have “staying power and profit-making stamina”

(Kuczmarski, 1996, p. 9). In contrast, Silverstein et al. (2005)
argue that innovation could be more valuable in incremental but
widespread and consistent doses, rather than in radical but one-
off instances. Robinson and Schroeder (2006) support this belief
and argue that small, situation-specific ideas are more likely to
remain proprietary and are more difficult to copy. Furthermore,
they add that managing a steady flow of small ideas is the best
way for an organisation to reach a radical innovation.
Creativity is the seed, starting point, or foundation of
innovation. However, although necessary, creativity is not
enough for innovation to occur (Amabile et al., 1996; Segal,
2006). Successful innovation depends on various factors and
conditions, including the physical, social and psychological
work environment and on whether the organisation has an
effective innovation management system in place. These issues
are explored below, after a brief discussion in the next section on
entrepreneurship, intrapreneurship and their link to creativity
and innovation.
Entrepreneurship and Intrapreneurship
If organisations are to become innovative, they need to be

courageous in their business decisions. This requires a new
entrepreneurial thinking approach … Managers will need to
become entrepreneurs if they are to strike the right balance
between the concepts of efficiency and effectiveness in their
targeted markets (Goodman & Dingli, 2017, p. 37).
Entrepreneurs are individuals who set up businesses, recognise

and exploit opportunities, and introduce innovative products
and services to the market. Entrepreneurship involves the
application of creativity and futures thinking to identify
gaps in the market and create methods and offerings that are
perceived by customers as value-adding (Goodman & Dingli,
2017). Entrepreneurship is intricately linked to creativity and

innovation, as “it is creativity that leads to the development of
new products and processes which when innovated replace the
traditional and previous versions” (Lumsdaine & Binks, 2007,
p. 19). Furthermore, entrepreneurs are “important agents of
innovation” (Bosma & Harding, 2007, p. 16), due to the products
and services they provide and the technologies and processes
they utilise. Entrepreneurship is also a major source of job
creation, as setting up businesses creates employment for the
founders as well as for any employees they recruit. With this in
mind, the European Commission (2013) has argued that more
entrepreneurs are needed to bring Europe back to growth and
higher levels of employment.
Yet, there is more to entrepreneurship than starting up
and running a business. Entrepreneurship is essentially a
management style, and an entrepreneur is one who manages in
an entrepreneurial way. Entrepreneurial managers are those who
are willing to “create change and to pursue opportunity rather
than just to maintain the status quo and conserve resources”
(Wickham, 2006, p. 17). Moreover, “a sense of initiative and
entrepreneurship” has been identified as one of eight key
competences for life (The European Parliament and the Council
of the European Union, 2006, p. 13). This refers to the ability
to turn ideas into action and includes creativity, innovation
and risk-taking, as well as planning and managing projects.
Entrepreneurship is therefore a mindset, a way of thinking and
behaving in a creative and self-motivated manner. It involves an
ongoing search for new opportunities in order to change things
for the better. From this perspective, Europe also needs more
entrepreneurs working within organisations as entrepreneurial
employees, also known as intrapreneurs.
Intrapreneurship, also referred to as internal entrepreneurship
or corporate venturing, refers to the development of business
ventures within existing organisations, or possibly in spin-off
companies. Such ventures hold a great deal of potential if they
are effectively managed, as they may tap into the resources
of their mother company while enjoying the entrepreneurial

benefits of small, new enterprises (Tidd & Bessant, 2011). The
personnel who lead such initiatives are known as intrapreneurs,
or innovation champions (Goodman & Dingli, 2017) as they
initiate and implement innovative systems and practices within
their organisation (Maier & Pop Zenovia, 2011). Intrapreneurs
can be found in organisations of all sizes including SMEs, and in a
variety of roles, levels or departments, as long as the organisation
has a culture that enables the generation of new ideas and drives
their implementation (Goodman & Dingli, 2017).
Traditional organisations are often reluctant to recruit
employees with entrepreneurial skills, as such individuals are
perceived as posing the risk of moving to a competitor or setting
up their own company using knowledge adopted from their
employers (Goodman & Dingli, 2017). A recent local study by
Cassar Shaw (2014) among former business owners indicates
that this so-called “fear of incubating competitors” (MacMahon
& Murphy, 1999) may not be entirely unfounded, as most of her
respondents expressed a desire to start up another business one
day. However, she argues that prospective employers should
understand that the entrepreneurial experience of former
business owners could be a great asset to their organisation:
“prospective employers should view former entrepreneurs as
allies rather than threats, and they should capitalise on their
intrapreneurial knowledge and skills for the benefit of all
parties involved” (Cassar Shaw, 2014, p. 19). This also applies to
employees without business ownership experience who have an
entrepreneurial flair:
Organisations are increasingly appreciating the importance of
a strong entrepreneurial approach to innovative activities and
encouraging employees to become intrapreneurs (Goodman &
Dingli, 2017, p. 197).
Organisations therefore have much to gain from harnessing the

entrepreneurial spirit of all their members, including becoming
more creative, productive, competitive and innovative. The rest
of this chapter focuses on how managers can foster creativity and

innovation within their organisation, which implicitly addresses
how they can become more entrepreneurial.
Setting the Stage
The degree to which personal creativity occurs depends on a

complex set of environmental or contextual factors (Goodman
& Dingli, 2017, p. 72).
As outlined above, innovation, entrepreneurship and

intrapreneurship are not automatic outcomes of the creative
potential of individuals. Whether or not employees propose ideas
at work and the likelihood that such ideas will lead to innovative
outcomes depend on a multitude of personal, interpersonal
and contextual factors. It is beyond the scope of this chapter
to discuss ways in which individuals can enhance their own
personal creativity. However, as managers “both inherit and
fashion the attitude that an organisation takes to creativity and
innovation” (Goodman & Dingli, 2017, p. 146), it is relevant to
outline some of the main interpersonal and contextual enablers
that they should consider when setting the stage upon which their
employees are to perform. Although by no means exhaustive,
the following is a synthesis of six of the top factors that make up
a creative culture (shared norms, traditions, beliefs and values)
and climate (behaviours, interactions, policies, processes and
procedures), as discussed by various authors.
Risk Taking and Fear of Failure

Creativity and innovation involve an inherent degree of risk
and uncertainty. There can never be any guarantee that a novel
idea can be successfully developed and implemented, and it is
impossible to predict whether or not it will be well received. An
important element of a creative climate is therefore allowing
members of the organisation to experiment and take calculated
risks without the fear of negative repercussions should their

efforts not have the intended outcomes. Tidd and Bessant (2011,
p. 45) note that:
In a high risk-taking climate, bold new initiatives can be taken
even when the outcomes are unknown. People feel that they can
‘take a gamble’ on some of their ideas. People will often ‘go out
on a limb’ and be first to put an idea forward.
On the other hand, excessive risk taking can be detrimental

as it leads people to feel confused, concerned and frustrated.
In such a scenario, one may find many ideas in circulation, but
few would be authorised for implementation (Tidd & Bessant,
2011). A balance is therefore required in the amount of risk that
is expected and permitted within an organisation. A balanced
risk-taking environment would, in turn, minimise employees’
fear of failure, which is one of the greatest inhibitors of creativity.
Although all successful innovators have experienced failure in
their creative endeavours, many people feel the need for social
acceptance (including by their colleagues) and are afraid that
failure may lead to ridicule, rejection and – in a status conscious,
small island society like Malta – blacklisting and reputational
damage. Reputation is a valuable asset in any part of the world,
but when one lives on a small, densely populated island, much
activity takes place in the public eye and news travels like
wildfire. Mistakes become quickly known. Relocating to the next
city to start afresh if one’s name gets tainted – as could happen
in a larger country – will not work. The issue of reputation is
closely linked to the strong sense of family honour, pride and
shame which characterise Maltese society (Boissevain, 1974;
1993). When combined with constant public scrutiny and the
importance of maintaining a good reputation, these values
could lead to a deep fear of failure and of letting down one’s
family. This has very important implications for creativity and
innovation because, if fear of failure prevails, entrepreneurial
creativity and innovation would be severely undermined. As
outlined above, a risk of failure is inseparable from creativity and
innovation, therefore those who embrace failure as a by-product

of the creative process are at an advantage in the race to business
success.
Closely related to the concepts of risk taking and fear of failure
is what Hofstede (2018) refers to as ‘uncertainty avoidance’. This
is one of six dimensions upon which national cultures may differ,
and is defined as the extent to which members of a society feel
threatened by uncertain and ambiguous futures. Malta has a
very high score on this dimension (96 out of 100): this suggests
that the Maltese are strongly inclined to avoid uncertainty and
resist novel ideas and innovation. If this were true, the potential
for creativity and innovation in Maltese organisations would
be undermined; risk-averse employees would be less likely to
come forward with creative ideas (El Murad & West, 2004).
However, a study among business owners in Malta (Baldacchino,
2007) found that risk-taking is largely accepted and failures go
unpunished, provided that the risks are calculated and discussed
with superiors prior to execution.
Trust
Trust refers to “emotional safety in relationships” (Tidd & Bessant,
2011, p. 138). This is widely accepted as an indispensable condition
for creativity to occur in an organisation. Employees must trust
their managers and each other, while managers must trust their
employees. Trust builds safe environments which facilitate the
sharing of ideas. It enables social cohesion, enhances confidence
and increases commitment and loyalty to the organisation
(Goodman & Dingli, 2017), while lowering tension and emotional
pressure. As noted by Tidd and Bessant (2011, p. 38):
When there is a strong level of trust, everyone in the organisation
dares to put forward ideas and opinions. Initiatives can be taken
without fear of reprisals and ridicule in case of failure. ... When
trust is missing, count on high expenses for mistakes that may
result. People are also afraid of being exploited and robbed of
their good ideas.
Reiter (2013) undertook a study of an international betting

company based in Malta. Her results support the notion that
higher levels of trust are associated with higher levels of creativity
and, moreover, that trust can be actively built through particular
activities. A trust-building programme was developed and
tested in an experimental design consisting of a test group and
control group. Results suggest that the test group’s level of trust
increased, while that of the control group decreased slightly.
In addition, the creativity performance (number and quality of
ideas generated on assigned creativity tasks) of the test group
improved following the intervention, while that of the control
group deteriorated. Although this was a small scale, exploratory
study, its findings hint that trust can be actively built within
work groups, and higher levels of trust may contribute to better
creative performance.
Trust is a defining feature of family firms (Eddleston &
Morgan, 2014), which constitute around 70% of registered
businesses in Malta (European Commission, 2017). Family
members are generally willing to rely on each other for help
and support, both for personal issues and in business settings
(Eddleston & Morgan, 2014), and may thus be more likely to
feel safe sharing ideas with one another. Family influence has
been found to foster a positive business culture that supports
the goals of the firm and a sense of pride in the business, which
in turn enhances firm innovativeness and performance (Craig,
Dibrell & Garrett, 2014). In addition to high levels of trust, the
family business culture may provide a safe environment for
sharing and testing ideas, as family members are less likely to
be reprimanded or punished than unrelated members of staff
working in a corporate enviroment. This could be a double-edged
sword, however, as too much leniency in a family business may
lead to slack, complacency, opportunism and poor performance
(Eddleston & Morgan, 2014).
Trust can also be present between different organisations
or across society as a whole (Eddleston & Morgan, 2014), and
this could have implications on the willingness of individuals
to generate and share their ideas with others. Malta’s small size
and high population density makes it seem as though everyone
knows everybody else, which could impact the level of inter-
organisational trust. Sultana (2006) notes that, in spite of the
high level of familiarity in small states, local cooperation and
collaboration is not necessarily easier, as it may lead to distrust
and contempt. In support of this, there are some who complain
about a lack of cooperation and trust between the Maltese, such
as this entrepreneur in Baldacchino’s (2007, p. 82) study:
Aħna pajjiż kelb. Aħna klieb. Ngħidha lil kulħadd, hija kultura
tagħna. Malta ma sseħħx din ... li inti tħabbat il-bieb ta’ xi ħadd
biex jgħinek! [We have a ‘dog eat dog’ attitude here in Malta. I
say this to everyone, it is our culture. Knocking on someone’s
door to ask for help is unheard of here.]
Other complaints from entrepreneurs concern the lack

of originality, a prevailing herd mentality, and a problem with
piracy of ideas among the Maltese:
If you have a good idea everybody tries to copy it … and it ends
up killing off the person who came up with it originally … People
just steal ideas. It’s very common (Baldacchino, 2007, p. 82).
Does this imply that the Maltese are unable – or perhaps

simply unwilling – to generate their own ideas? Could this be
explained by Malta’s long history of foreign invasion (Cassar,
2000), during which the Maltese learned to rely heavily on, and
often take advantage of, their rulers? Whatever the reason, this
problem could be curbed by stepping up intellectual property
rights to protect those groups or individuals who generate ideas
for innovative products, services or processes.
Time to Think
Managers do not often allow their employees to spend their time
on activities that do not directly contribute to job productivity
(Goodman & Dingli, 2017). This was confirmed in a study
carried out among social workers in Malta (Agius, 2015). The
respondents maintained that having a work environment

which offers sufficient time and space for nurturing creativity
would be beneficial, but this was unfortunately lacking in their
organisation. They stated that work stress and pressure left
them with little time for reflection and creativity. Furthermore,
they claimed that feeling overstressed negatively impacts their
creativity at work, as they are led to focus on their day-to-day
tasks and to feel inhibited to engage in creative acts. This is in
line with Amabile et al.’s (2002) findings that work environments
which exert excessive time pressures and extreme deadlines
produce a negative impact on creativity.
In contrast to the above scenario, leading global organisations
such as 3M and Google are well known for allowing their employees
to spend a percentage of their working hours engaged in creative
endeavours of their choice; various successful innovations, such
as Gmail, Google Maps and Twitter, have emerged as a result.
The creative process requires a certain amount of time to think,
thus allowing some slack and setting aside regular time periods
for employees to generate and elaborate new ideas is important.
Otherwise, time pressure would make it impossible to think
creatively (Tidd & Bessant, 2011).
Note, however, that a minority of respondents in Agius’ (2015)
study claimed that, when working under pressure with tight
deadlines, or when faced with problems that require alternative
solutions, the development of creative ideas may be enhanced.
As one respondent reported, creativity may be triggered:
… when we get caught up with our back against the wall. When
... I don’t find many options, or those options we usually choose
are not applicable to this case. Everyone begins to brainstorm,
and we get an idea which is not very common, but it still succeeds
most of the time (Agius, 2015, p. 75).
This indicates that organisations should seek an optimal

balance of thinking time and work pressures to stimulate
creativity and innovation: “There is an optimum amount of
time and space to promote creativity and innovation” (Tidd &
Bessant, 2011, p. 142), which should neither be too little nor too
much. An interesting suggestion in this regard was put forward
by Segal (2006, p. 11):
Consider using 10 percent of your regular meeting time for
new-idea collection, generation, and conversation. If your
regular meeting is an hour long, that’s six minutes. As this
practice becomes routine, people expect it, and are prepared for
it, and contribute to it. What happens to the new ideas? They are
recorded for an idea review meeting that takes place quarterly.
Instead of feeling pushed to generate ‘breakthrough ideas’ in one
three-hour meeting, your team, group, or committee reviews all
ideas that have been contributed to date and selects those that
seem most promising. It’s a much better use of ideational time
and supports your notion of welcoming ideas.
Top-Down Support
Allocating an appropriate amount of time to think is helpful for
generating new ideas. However, developing these ideas requires
a supportive climate where there is a “sense of management
involvement, commitment, enthusiasm and support” and
“where ideas and suggestions are received in an attentive and
kind way by bosses and workmates” (Tidd & Bessant, 2011, pp.
102, 142). Managers have a significant role to play in providing
the appropriate support for creativity and innovation, as their
beliefs, attitudes and behaviours lay the foundations upon which
the organisation’s practices and policies are built. Top-down
support for creativity and innovation is thus crucial in any
business (Kuczmarski, 1996; Thacker & Handscombe, 2003) as
“the incidence of creative activity is contextually governed by
the degree of group and/or organisational support” (Goodman
& Dingli, 2017, p. 73). They are arguably even more important in
SMEs, which constitute 99.8% of all enterprises and account for
79.3% of employment in Malta (European Commission, 2017),
as the owner-manager’s role in all business activities is so central
in smaller organisations.
In organisations that are characterised by top-down support,

a constructive and positive atmosphere is created (Tidd &
Bessant, 2011). Some organisations have invested in on-site
creativity centres where employees can escape their daily
routine, seek inspiration and stimulate their creativity. Such
centres are indicative of significant commitment to innovation
on the part of top management (Goodman & Dingli, 2017).
Conversely, where top-down support is low, the atmosphere is
negative and stifling. Ideas are rejected because the default mode
of responding is to find faults and objections, and play the blame
game. If any creativity and innovation take place in organisations
like this, it would be “in spite of the senior management” (Tidd &
Bessant, 2011, p. 102) rather than because of them.
In a study of start-up enterprises in Malta, owner-managers
claimed that they provide the necessary top-down support and
foster an organisational climate that is conducive to creativity
and innovation (Baldacchino, 2007). They reportedly encourage
and implement their employees’ ideas, a disposition which is
indicative of a supportive creative climate (Martins & Terblanche,
2003). Such positive behaviour should be encouraged and
practised widely by managers in all organisations.
Communication
A fifth requirement for creativity and innovation is open
communication across all levels of the organisation (Martins &
Terblanche, 2003). Individuals need to be given the opportunity
to express their ideas (Segal, 2006), and these ideas need to be
communicated to colleagues, team members and managers as
part of the innovation process: “Individuals or groups simply
going about their business and doing their own thing will rarely
innovate” (Lumsdaine & Binks, 2007, p. 193). Even if workers
do have good ideas, these need to be articulated, discussed,
developed and cross-fertilised with those of others. Informal
channels of communication are just as important as formal
channels:
It is precisely the informal, unanticipated exchange between

employees who do not normally communicate on a regular basis
that often moves a project forward (Lumsdaine & Binks, 2007,
p. 194).
Unfortunately, many people are still resistant to openly

communicating their ideas to others, as past experience may have
taught them that they may be robbed of their ideas by unethical
colleagues (Lumsdaine & Binks, 2007). However, open channels
of communication may alleviate feelings of insecurity, suspicion,
and lack of motivation by fostering cooperation and purpose
(Goodman & Dingli, 2017). In a local context, Baldacchino (2007)
found that a high percentage of owner-managers of start-ups
claimed to practice an open-door policy, which indicates ease
of communication across all organisational levels. This should
enhance creativity and innovation by increasing the likelihood
that employees communicate their ideas with colleagues and
superiors (Martins & Terblanche, 2003).
Financial Support
Another important condition for creativity and innovation to
take place in organisations is having adequate financial support.
Innovation involves a degree of financial risk, therefore the
organisation’s financial managers need to recognise the potential
benefits of innovation and be willing to provide the funds
necessary to see the process through: “Too tight financial control
on ‘creatives’ is not conducive to successful innovation, which
needs a full resource support” (Goodman & Dingli, 2017, p. 126).
Silverstein et al. (2005, p. 2) argue that the funds allocated for
innovation could spell the difference between ‘business as usual’
– “performing just well enough to stay alive or make a small
profit” – and ‘business as exceptional’ – “the state a company
achieves when it enjoys greater profit margins by virtue of
greater innovation”.
Funding to support innovation (including research and

development) in Malta has increased considerably over recent
years, thanks largely to the funds provided by the European
Union for this purpose. These funds are being offered through
a number of support programmes and incentive schemes, many
of which are aimed at start-ups or SMEs displaying innovative
qualities in their products, services or business processes. These
include a number of R&I (Research and Innovation) Programmes
offered by the Malta Council for Science and Technology, funds
and tax credits for innovation by Malta Enterprise, and the
Business Enhance RD&I Scheme offered by the Parliamentary
Secretariat for European Funds and Social Dialogue to enable
businesses to innovate, diversify or expand their operations.
Although financial support is required to develop, test and
implement ideas in pursuit of innovation, funds may not be
necessary to entice employees to generate ideas. The issue of
motivation and rewards with respect to creativity and innovation
is discussed next.
Eliciting Ideas
While creativity will occur, to some degree, even when it

is discouraged and opposed by organisations in society, its
incidence increases if it is actively encouraged (Goodman &
Dingli, 2017, p. 72).
Whenever managers consider ways in which they should

encourage their employees to generate ideas at the place of work,
the issue of rewards almost always crops up. Common sense may
suggest that offering rewards for ideas is a wise thing to do, and
that offering more generous rewards would motivate employees
to offer more and better ideas. This view was shared by just
over half (54.4%, n = 49) the entrepreneurs in Baldacchino’s
(2007) study of start-ups in Malta, who reported that they offer
rewards, including financial incentives or promotions, to entice
employees to submit ideas. Various authors concur with this

‘common sense’ view: Martins and Terblanche (2003) argue that
organisations should offer rewards to promote creativity and
innovation; and Segal (2006, p. 7) maintains that “if the desired
behaviours are neither rewarded nor supported, the desired
results will not appear”. Yet, others express concerns about
rewarding employees for generating creative ideas, as this could
lead to extinguishing the very process that it is meant to ignite
(Pink, 2009; Robinson & Schroeder, 2006). Should, therefore,
rewards be offered to employees to encourage them to generate
ideas at work?
In order to shed light upon this conundrum, it should first
be noted that motivation has two sources: intrinsic (from within
the person, which propels individuals to participate in activities
for their own sake or enjoyment) and extrinsic (from external
sources, which entices individuals to act with the promise of
attaining a benefit or reward). Individuals are more likely to work
hard, persevere and produce work of a higher quality when they
are intrinsically motivated. The effects of extrinsic motivation
are, however, less consistent in organisational settings where in
some cases, extrinsic rewards have been observed to enhance
intrinsic motivation and performance, while in others they have
been found to do the opposite. The nature of the task is a key
determinant as to whether the effects of extrinsic motivators
will be positive or negative (Pink, 2009). Extrinsic motivators are
effective when the task involves a narrow focus and clear goals,
but when it requires creative thinking, extrinsic rewards can be
detrimental as they focus attention and effort in a linear manner
towards achieving the reward, rather than enabling lateral and
divergent thinking in search of solutions and ideas. The most
likely reasons for the undermining effects of extrinsic motivators
on creativity is that they could divide attention between the
extrinsic goals and the task at hand, and that extrinsic rewards,
such as payment, may turn ‘play’ into ‘work’ (Amabile, 1993).
Moreover, Robinson and Schroeder (2006) warn that a reward
system could potentially undermine creativity through three
main problems, particularly if it attempts to reward individuals

based on the value of their ideas:
(1) it is time-consuming and often impossible to accurately
calculate the value and impact of ideas and allocate
appropriate rewards. Consequently, employees may
perceive their rewards as undervalued, and feel
demotivated if they believe they deserved better;
(2) generally, only the originator of the idea is rewarded,
even though many others may have been involved in
evaluating, developing and implementing the idea. Such
a practice may be viewed by these others as unfair, giving
rise to resentment and a tendency to sabotage or reject
their colleagues’ ideas: “why should they put in extra
work to develop an idea, when someone else will collect
the reward for it?” (Robinson & Schroeder, 2006, p. 18);
and
(3) rewards could lead to unethical behaviour: for example,
managers may try to save money on rewards owed to
employees, who may in turn try to cheat the system or
their colleagues for undeserved rewards.
Financial rewards may not be needed for enhancing creativity

and innovation. Robinson and Schroeder (2006) claim that
most employees are intrinsically motivated to offer ideas which
improve their organisation in some way, due to a sense of pride
and a desire to feel that they are valued and making an impact.
They argue that receiving due recognition and appreciation for
good ideas, and where possible seeing their ideas being put into
practice, is highly motivating for employees.
Nevertheless, this does not imply that organisations should
avoid sharing the benefits of employees’ ideas with them. Rewards
can be given, as long as they are appropriately designed and form
part of a coherent and effective innovation management strategy.
Desirable features of a reward scheme include rewarding effort
rather than outcomes, ensuring that all those who played a part
in the idea generation and implementation process are suitably
rewarded, and distributing rewards in a fair and transparent

fashion. While acknowledging that intrinsic motivation is of
greater value than any extrinsic rewards, Goodman and Dingli
(2017, p. 149) offer some other useful suggestions for providing
meaningful rewards to employees:
Intrinsic rewards are generally considered to be more valuable
than bonuses or monetary rewards. These include recognition
and acknowledgement and positive reinforcement demonstrated
through approval and genuine appreciation, and benefits which
could include an increase in status or the assignment of a
challenge or task which carries particular significance (such as
representing the organisation at an important event or being
assigned to a work-related trip overseas) and possible perks.
Innovation may be self-rewarding, since the innovator may be
perceived by other employees and management as an ‘expert’
with an enhanced reputation.
Regardless of the kind of reward structure adopted, managers

should bear in mind that creativity is a skill that belongs to all
individuals and that can (and should) be improved through
training (de Bono, 1984, 2007). Various tools and techniques
have been developed for this purpose (e.g. Mindtools, 2018) and
training programmes are available at the University of Malta,
at both Diploma and Masters level (Edward de Bono Institute,
2019).
Managing Innovation
Innovation is not, and should not be, a sometimes thing, driven

by the bright few and held back by the average many. Rather,
innovation should be an all-the-time thing driven by trained
people in every part of the organisation (Silverstein et al., 2005,
p. xi).
In addition to setting the stage for creativity and innovation to

occur, and providing appropriate motivators to elicit ideas from
employees, managers require a system for managing innovation.
If efforts are successful, managers should regularly receive many
ideas from employees. This is an excellent source of innovation.
After all:
regular employees – the people who do the office work, make
the products, and serve the customers – see plenty of problems
and opportunities and come up with good ideas about how to
address them (Robinson & Schroeder, 2006, p. 3).
However, this situation brings with it the challenge of how

to deal with such a large number of ideas in an efficient and
effective manner.
In small organisations, like most of the ones found in Malta
(European Commission, 2017), a formal structure may not
be required for managing innovation: the manager generally
knows what is going on and can respond to ideas in a quick
and practical manner. Such organisations would benefit from a
“relaxed and informal flow of ideas and the implementation of
innovations”, as long as the manager is open to ideas from others
(Goodman & Dingli, 2017, p. 125). However, larger organisations
cannot do without a structure or system if they are to process
large numbers of employee ideas in a timely and cost-effective
manner (Robinson & Schroeder, 2006). Some people believe that
all structures are detrimental to creativity, and cite unnecessary
bureaucracy and unhelpful procedures that may stifle creative
thinking. However, this is not necessarily the case as some
structures can be useful in managing innovation:
We must be careful not to fall into the chaos trap – not all
innovation works in organic, loose, informal environments or
‘skunk works’ – and these types of organisation can sometimes
act against the interests of successful innovation. … Too little
order and structure may be as bad as too much (Tidd & Bessant,
2011, p. 100).
An idea management system is a useful set of procedures that

ensures that employees’ ideas are handled smoothly and fairly. In
the absence of such a system, every idea that is presented has to
be handled individually. Employees would have to figure out to
whom to take their ideas, and managers would be unsure what to
do with the ideas they receive. This would be a waste of precious
time and resources and would likely lead to the idea fizzling out
before it can ever be evaluated and implemented (Robinson &
Schroeder, 2006).
Robinson and Schroeder (2006) argue that, although the
specific processes can vary greatly between companies, every
effective idea management system follows the same eight basic
principles, namely:
(1) ideas are actively encouraged as a part of everyone’s job,
and welcomed through top-down support, commitment
and trust;
(2) submitting ideas is straightforward and easy;
(3) evaluation of ideas is quick and effective: ideas are
reviewed at the lowest possible level where people
have direct knowledge of the situation, will be directly
affected if implemented, and can build on or modify the
idea to improve it. Only more complex ideas are sent to
top levels for approval;
(4) feedback is timely, constructive and informative to
provide the opportunity to refine an idea. It implies
that the idea was taken seriously and keeps employees
motivated;
(5) implementation is rapid and smooth, possibly before
higher management even becomes aware of it;
(6) ideas are reviewed for additional potential by exploring
where else they can be used;
(7) people are recognised and success is celebrated; and
(8) the performance of the idea system is constantly
measured, reviewed and improved.
The above eight principles relate primarily to small, everyday

ideas proposed by employees with the aim of making their
company and/or their jobs a little better. Radical innovation
may require a different approach, with more focus on
research and development, and a more rigorous screening and
implementation strategy. As indicated earlier, there is some
debate as to whether incremental or radical innovation should
be sought by organisations. Robinson and Schroeder (2006)
argue that, although many business leaders are hungry for
breakthrough innovations, ‘big idea’ systems could be limiting
due to the following reasons: (1) radical ideas are not easy to think
of; (2) implementing radical ideas often requires considerable
resources; (3) breakthroughs are visible (often advertised) and
may be copied; (4) sustainable competitive advantage may
therefore be hard to achieve.
On the other hand, ‘small ideas’ systems are often more
attainable, because:
(1) small ideas are easier to generate;
(2) they can often be implemented with minimal resources;
(3) they are often invisible to competitors;
(4) even if they are visible, they are often situation-specific
and it would not be appropriate for competitors to copy
them; and
(5) sustainable competitive advantage is therefore more
likely. Furthermore, small ideas may accumulate into
radical innovation:
We found that radical change did indeed take place when

managers began encouraging and implementing large numbers
of employee ideas. The implications were vast and profound:
for improving performance, the organisation’s culture, and the
quality of people’s lives (Robinson & Schroeder, 2006, p. xiii).
Ultimately, both incremental and radical innovation are

of value, albeit in different ways. As noted by Silverstein et al.
(2005, p. 9):
The key for business is that improvement and innovation are

elements of a balanced whole, and if they are out of balance,
overall sustainability and profitability will suffer. You need
enough improvement-type projects running in parallel with
more aggressive innovation projects, such that the more
predictable income from the former funds and fuels the latter
on an ongoing basis.
Conclusion
The act of innovation is an act of conceiving the future, which

is what great companies do. They give birth to new ideas that,
when commercialised, improve the quality of life for their
customers and themselves (Silverstein et al., 2005, p. 2).
It is widely accepted that organisations cannot flourish without

a healthy dose of creativity and innovation. Creative thinking
has become as critical to business as any other key success
factor including finances, raw materials and human resources.
In an age where competence, information and state-of-the-art
technology have become commodities, “what is going to matter
is the ability to design and deliver value. That needs creative and
design thinking” (de Bono, 2005, p. 4). Furthermore “unless the
organisation machine is used to put powerful ideas into action”
the potential of competent organisations would be wasted
(de Bono, 1993, p. 309). Local research has indicated that this
holds true also for the Maltese context, where creativity and
innovation have been found to be key factors in the success of
start-ups (Baldacchino, 2007; Baldacchino, Cassar & Caruana,
2008) as well as in the survival and adaptation of organisations
through times of recession (Camilleri, 2018).
Creativity, innovation and entrepreneurship have nowadays
become ‘buzzwords’, but there are many fine examples of the
Maltese being creative, innovative and entrepreneurial long
before these terms gained their current popularity. For example,
in the banking sector, the founders of the Anglo-Maltese Bank,

Banco di Malta, Tagliaferro Bank and Scicluna’s Bank (all of
which were eventually merged to form the current Bank of
Valleta) were pioneers in the early to mid 1800s (Fenech, 2006);
they remain household names among the older generations and
are recalled with respect and admiration. The same can be said
for other sectors, such as brewing, where Farrugia and Sons
first ventured into the industry in the 1920s (Farsons, 2018);
hospitality, where Lord and Lady Strickland had an idea for the
first luxury hotel in the 1930s (The Phoenicia, 2018); and the
TEFL (Teaching English as a Foreign Language) industry, which
traces its roots to a joint initiative between NSTS (National
Student Travel Service) students and the lecturers from the
Department of English at the University of Malta, who hosted the
first Italian students on an English language holiday in the 1960s
(ELT Council, n.d.). The late 1970s saw the first indicators of an
emerging software development industry in Malta, when a small
number of companies were set up in response to advancements
in hardware technology, although the ICT (Information and
Communication Technology) industry really came into being
between 1995 and 2005 with the formation of nearly 200 ICT
businesses during this 10-year period, followed by the birth of
the electronic gaming sector in 2004 (Aloisio, 2015).
These and similar examples support the notion that citizens
of small island states with limited natural resources must be
creative in order to survive and prosper. They also illustrate that
the Maltese are more than capable of being creative, innovative
and entrepreneurial, to the extent that they have been successful
in creating various industries and addressing new niches, often
on their own initiative. Those who are responsible for managing
people in Malta are thus urged to nurture their own creativity
and that of their colleagues and employees, so that their
organisations can continue to face present and future challenges
in an innovative and entrepreneurial manner.
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PART TWO
HR ISSUES IN SPECIFIC ECONOMIC SECTORS
Agriculture, Aquaculture
and Fisheries: Harvesting
Resources from Soil and Sea
Everaldo Attard
A number of surveys and studies have been published in relation

to the agricultural and fisheries workforce in Malta. These
include the census of agriculture for 1983, 2001 and 2010, the
European Union (EU) farm structure survey (FSS) for 2003 and
2010, and agriculture and fisheries statistics for 2014. During
censuses, all farmers and breeders are interviewed, whereas only
a sample is taken into account during farm structure surveys.
In the 2003 farm structure survey, some 14 per cent of farmers
were interviewed (Vella, 2003).
These primary industries in Malta do not benefit from
economies of scale, fertile soils or rich fishing grounds, and
they have been heavily impacted by the consequences of Malta’s
accession to the European Union. This chapter reviews the nature
of these industries, the oldest in Malta, and the composition of
their workforce. Some of the consequences of climate change on
their practices are also examined.
Metrics, Diagnostics and Indicators
In the Maltese Islands, agriculture is the largest land user and

is considered as the green lung of the islands. In 2001, 10,148
hectares were declared as utilised agricultural area (UAA).
According to the FSS 2010 data, 36.2 per cent of the Maltese
land was utilised for agriculture, covering 11,450 hectares. At
the time, this was the smallest area recorded within the EU-27
(FSS, 2010). Agriculture may not be perceived as a significant
economic contributor: indeed, along the years, there has been a
drastic decline in the contribution of agriculture to GDP: from
7.2 % in 1970 to 1.4 % in 2016 (The World Bank Group, 2018).
However, agricultural and fisheries practices extend beyond the
economic values of the activities themselves and, apart from
food security issues, the rural character of the countryside is also
an important asset. Although the utilised agricultural land has
decreased throughout decades, the number of land holdings has
increased. This is possibly due to greater administrative scrutiny
and the division of land by inheritance over various generations.
The decline in GDP parallels the decline in full-time
producers. The number of full-time employees has declined
significantly, while the number of part-timers has increased.
Most agricultural practices today are considered at a hobbyist
level rather than as economically feasible businesses.
Comparing the 2001 and 2010 data, farmer owned land
amounted to 1,984 and 2,721 hectares respectively, amounting
to 19.6% and 23.8% of the utilised agricultural area (NSO, 2003;
NSO, 2012). The rest of the land is worked by tenants. In Malta
there is no land under shared farming (Eurostat, 2018).
Full-time employment in agriculture has been declining for
many decades, and more drastically since 1983: between 1983
and 2013, there was a drop of 70% in full-time farmers, from
4,383 to 1,372. On the other hand, part-timers increased by 59%
over the same period, from 10,853 to 17,693. The shift towards
part-time farming has resulted in a significant overall negative
effect on the agricultural sector. Numbers are determined in
Agriculture, Aquaculture and Fisheries 221
terms of annual work units (AWU), an index that represents

the work carried out on the field. The national AWU is 1,800
hours, or about 35 hours per week (Agricultural Census, NSO,
2001). Between 1983 and 2013, the percentage of farmers who
contributed 100% AWU fell drastically, from 29% to 7%. In
2013, those contributing to less than 25% AWU amounted to
43% of those engaged in agriculture. The increase in part-time
farmers has resulted in problems that exacerbate the situation.
Such problems include land ownership, the fragmentation of
holdings, the division of resources such as water catchment,
road access and built agricultural structures. In other words,
the value of land and the ability for a farmer to work a parcel
of land where there is no water supply, no structure for the
storage of tools and with no road access, may well lead to land
abandonment. These problems, particularly land fragmentation,
have been experienced since the 1970s (Meli, 1993). In any case,
data suggests that unutilised land has decreased, from 4.2% to
2.2%, between 2001 and 2010. Some 1,120 ha were reported to
be used as kitchen gardens in 2010, reflecting a high number of
small agricultural holdings.
Crops
Fresh fruit and vegetables are produced for the internal market
rather than for further processing into specialized products.
However, a typical arable crop that is grown for domestic
consumption and for the processing industry is the tomato.
Tomatoes are specifically cultivated for the production of tomato
paste. There is a traditional link between the locally-grown
tomatoes and kunserva, a tomato concentrate which should
be in conformity with the Subsidiary Legislation S.L. 449.60.
This product is predominantly produced in Gozo by a private
company, which contributes to 60% of the share. As with other
farmer-supplied produce, there is a special agreement between
farmers and industry to guarantee the high quality of produce
from the farmers’ end to the procurement of the produce by

industry.
Due to the limited land space, farmers tend to cultivate a wide
variety of crops on a small scale, utilising intensive agricultural
means to maximise output. This justifies the cultivation of
seasonal fruit and vegetables on arable land that accounted for
79.3 per cent of the total UAA, as compared to the cultivation of
fruit trees (10.9 per cent) and kitchen gardens (9.8 per cent of the
total UAA, which stood at 11,453 hectares in 2010). The main
fruit and vegetables cultivated by Maltese farmers are potatoes,
beans, tomatoes, melons, onions, cabbages and strawberries. The
main Maltese cash crop is the potato tuber, which is grown for
the local market and for export. Disease-free seed potatoes are
imported from Ireland and Holland, sown during late autumn
and grown under the EurepGAP certification scheme. The potato
tubers are then exported mainly to the Netherlands. Between
2001 and 2014, the area under potato cultivation decreased
from 1,153 to 689 hectares. The exports also halved within this
period, from 6,069 to 3,100 tonnes. This may be attributed to
climate change leading to a lack of rainfall and the termination
of the assistance from the Special Market Policy Programme
Table 1: Total number of farmers, producers and breeders for 2001, 2010, 2014 and
2017 (NSO, 2018).
Year/Producers 2001 2010 2014 2017
Crop farmers 9,994 8,023 7,173 7,901

Grapevine producers 3,657 1,164 1,098 800
Olive producers 1,348 540 568 594
Sheep breeders 1,341 1,081 1,341 1,257
Goat breeders 722 595 803 757
Dairy cow breeders 177 144 120 97
Pig breeders 157 132 100 94
Poultry breeders 268 123 96 87
for Maltese Agriculture (SMPPMA). Such factors may render

cultivation operations economically non-viable. Crop farmers
fell by 21 per cent from 2001 to 2017 (Table 1).
Fruit under permanent cultivation include peaches, citrus,
olives and grapevines. With the emergence of new pests and
diseases, the management of stone fruit trees, particularly
peaches, is becoming more difficult, to the extent that some
farmers are uprooting old peach trees because of such problems.
From data collected in 1999 and during the census of 2001,
it was noted that the registered vineyards had increased in
area from 492 to around 600 hectares. Post EU accession, the
area increased to 686 hectares by 2013 (NSO, 2016). In 2017,
there were 951 registered farmers with vineyards (ARPA, 2018).
However, there was an overall decrease of 78 per cent in the
number of producers between 2001 and 2017 (Table 1). The rapid
increase in area prior to EU accession may be due to aids by local
vintners to farmers to convert their land into a vineyard. This was
further aided by SMPPMA regime and EU regulations, stating
that Maltese wine should be produced from locally grown grapes
only. At present, there are nine wineries in Malta and Gozo that
produce DOK (Denominazzjoni ta’ Oriġini Kontrollata) and IGT
(Indikazzjoni Ġeografika Tipika) wines (Leone Ganado, 2017).
In addition, vintners are today more interested in the making
of wine from local grapevine varieties, such as the Ġellewża
and Girgentina varieties, than the international varieties. The
viability of the sector relies on contractual relations between
the vintner and the vine grower. Factors include the prices for
different grape categories, grape quantities to be delivered to the
winery and the terms of payment.
Although Malta was renowned for olive oil production since
ancient times, the olive oil sector is still developing. Recently,
several olive mills were established and interest in local olive
varieties has been expressed by industry. Such varieties include
the Bidnija, tal-Malti and Bajda olives. The agricultural land
used for olive tree growing has increased substantially, from a
few hectares in 2001 to 140.3 ha in 2010 (NSO, 2012). In 2017,
there were 379 registered farmers with olive groves (ARPA,

2018). However, there was an overall decrease of 56 per cent in
the number of olive producers from 2001 to 2017 (Table 1).
Due to the lack of pastureland, intensively reared livestock
particularly cattle, sheep, goats and equines, require roughage
and concentrates to make up for their daily needs. Some
fodder crops are grown locally while the remaining fodder and
concentrates are imported. As reported in the censuses of 1983,
2001 and 2010, the area under forage cultivation did not vary
significantly (5,818, 4,464 and 5,553 hectares respectively) in
spite of changes in livestock populations. In 2013, forage crops
constituted 38 per cent of the UAA in Malta and 68 per cent in
Gozo and Comino (NSO, 2016). The main forage crop is wheat
(which has replaced clover), followed by barley and vetches.
Whereas wheat cultivation has increased throughout the years,
that of other forages has dropped significantly.
In 2010, 26 hectares (0.2 per cent of the UAA), were
dedicated to organic agriculture. Out of this, only 7.4 were
fully certified as organic in accordance with Council Regulation
(EC) No. 834/2007. Malta ranks the lowest in terms of organic
farms within the European Union (EC, 2016). Although this
type of agriculture is perceived as providing more wholesome
and agrochemical-free products, the Maltese organic farmer
faces a number of challenges, including the small field size and
fragmentation, the lack of buffering zones between organic and
conventional fields, restrictions in the use of agrochemicals,
pesticide drifts due to windy conditions and low soil organic
content. These problems reflect the small number of farmers,
currently amounting to fourteen, who are registered for the
production of organic products (Atriga Consult, 2018).
Livestock
The livestock industry experienced changes throughout the

years particularly when Malta joined the European Union.
This is partly attributed to the free market and the mandatory

improvements within farms.
The cattle industry is set for milk and meat production.
The number of local cattle farms between 2001 and 2013 has
remained steady, at 281 farms. This industry was expected to be
negatively impacted by Malta’s accession to the EU. There is no
specific EU directive, but the general directive on the protection
of animals kept for farming purposes (98/58/EC) does apply. It
was believed that the importation of foreign milk at a cheaper
price would adversely affect sales of local milk and associated
products (ricotta, yoghurt). However, with an organised local
cooperative, sound marketing strategies and a recent rebranding
exercise, the local milk industry has continued to thrive. In any
case, the local cattle population, including beef cattle, has fallen
by almost 20%, from 18,417 in 2001, to 14,883 in 2013. There was
also an overall decrease of 45 per cent in the number of dairy
cow breeders from 2001 to 2017 (Table 1).
Herdsmen mainly rear sheep and goats for their milk and
cheese production. This sector is considered as an important
cottage industry, from which entire families thrive for their
survival. Council Directive 91/68/EEC, concerning animal
health conditions governing intra-Community trade in ovine
and caprine animals, applies. As this is usually a family business,
the whole process from rearing the animals to the production
of milk and cheeselets (ġbejniet) is all done in-house. Some
sell the product directly to the consumers while others supply
supermarkets and groceries with their product. Renovation
within this industry was significant as, apart from farm-bound
regulations, breeders had to upgrade their cheeselet production
facilities in line with EU regulations. At first, this was perceived
negatively by the sheep and goat breeders, but the quality of
local products and their presentation has significantly improved.
The sheep population has been largely stable, with 10,376 heads
reported in 2001 and 10,526 in 2013 (NSO, 2003; NSO, 2016).
The goat population saw a modest increase during the same
period: from 3,930 to 4,627 heads. Sheep breeders decreased by
6.3 per cent while goat breeders increased by 5 per cent over this
period.
The local pig production has been considered as a profitable
industry, but was significantly affected by Malta’s accession to the
EU. Council Directive 2008/120/EC, concerning the minimum
standards for the protection of pigs, applies to this sector. In
2001, the pig population reached 81,840 heads, on 157 farms.
The population declined to 47,460 heads in 2013, on 100 farms.
Pig breeders were given subsidies to renovate their farms and
invest in production; but unfortunately, some breeders found
it difficult to cope with the necessary investment and had to
close down. On the other hand, some pig breeders perceived the
potential and, through investment, their farm has grown bigger
and so more efficient and profitable (Table 1).
Another livestock sector that has seen significant changes is
the poultry industry. Chicken are reared either for their meat
(broilers) or for egg production (layers). From 2001 to 2013, the
number of poultry holdings decreased from 847 to 779, with a
halving in poultry populations, from 1,940,440 to 918,430 heads.
This is mainly due to the influx of imported poultry products
and animal welfare regulations that restricted poultry breeding
conditions (Council Directive 1999/74/EC and 2007/43/EC).
There was a dramatic decline in the number of poultry breeders,
from 268 in 2001 to 87 in 2017 (Table 1).
Malta has been renowned since Phoenician times as the island
of honey. Beekeeping and honey production link bees to wild
flora and cultivated crops besides the bee services agriculture
through pollination. In 2004, the apiculture workforce amounted
to 191 active individuals (TOM, 2004). Beekeepers face a
number of problems with hive maintenance, the small size and
fragmentation of agricultural and unutilised land, problems with
pesticide applications by third parties, climate related changes
(such as drought) and the seasonality of wild flora and cultivated
crops.
Fisheries
The fisheries sector is divided into two: open sea fisheries and
the aquaculture industries. In 2017, it was estimated that, out
of the 377 full-time fishers, 83.2 per cent are considered as
small-scale (Borg, 2017). In 2013, the number of fishing vessels
amounted to 2,493. This sector is facing several problems.
Within the Mediterranean, around 93 per cent of edible fish
species are overfished. Although artisanal, small-scale fishing
does not significantly impact on fish populations, conversely,
overfishing is affecting the livelihood of these fishers. Other
factors besides overfishing include such human activities as
vessel traffic, sea and atmospheric pollution, and climate change.
One of the most devastating changes in the fisheries activities
is industrialisation. This has occurred after the introduction of
trawlers and aquaculture.
There are seventeen trawlers registered in Malta (NSO, 2016).
They catch most of the fish, leaving less fish for the small-scale
fishers to catch. The main fish species that are landed by fishers
are the bluefin tuna (tonn), dorado (lampuka) and swordfish
(pixxispad). However, between 2010 and 2013, registered
landings of these three main species decreased by 39.7, 59.8
and 9.7 per cent, respectively. All factors mentioned above are
leading to the shrinking of the fisher communities and, within a
few decades, there may very well be no more artisanal fishers left
(Borg, 2017).
Meanwhile, the aquaculture industry has grown rapidly
worldwide. Malta has the largest tuna farming capacity in the
world, with a potential of 13,800 tons (Borg, 2017). In 2016,
six aquaculture farms were registered in Malta (NSO, 2017a),
mainly catering for tuna farming, followed by sea bream and
sea bass. Maltese entrepreneurs purchase shoals of tuna from
local and foreign Mediterranean purse-seine fishers and house
them in huge cages. There is a huge demand and a high price
for bluefin tuna in Japan for sushi and sashimi (Borg, 2017).
Due to the environmental impacts of fish farms, The Planning
Authority has obliged the operators to move their activity off-

shore (Leone Ganado, 2017). Environmental impacts include
eutrophication, the spreading of an oily slime and effects on
coral and algal habitats. Fish farm operators experience pressure
from authorities on the way they operate, from new fish farm
applicants leading to pressures on the sea area allocated to fish
farming, and from other industries, particularly the tourism
industry. In 2007, 236 employees were involved in this industry,
with 69.1 per cent employed on a full-time basis. Almost all the
employees (93 per cent) were males, with 60 per cent of the total
number below the age of 35 years (Scott et al., 2012).
Recruitment, Performance and Wages
Within the agricultural and fisheries sectors, businesses

are typically family run, and usually this passes on from
one generation to the next. Consequently, selection and
recruitment of personnel is relatively limited. However, in the
case of companies, there is more scrutiny in the selection and
recruitment of staff. In spite of all the dangers and safety issues
related to these activities, such industries do not seem to offer
an inductive programme to new employees. Introduction of
an employee to this industry is usually unplanned, and takes
the form of a learning process. In the case of family members,
usually the children get their training from their early years, by
assisting their parents and other family members on the farm
or fishing boat. However, due to job-related hardships, limited
vocational training and more stable salaried jobs, most children
are moving away from their parents’ vocation.
In most business activities, standard operating procedures
are implemented to ensure a high quality product. However, this
may not apply to the agricultural and fisheries sectors as, in most
cases, a successful output does not solely depend on standard
procedures, but also on environmental conditions in which case,
actions have to be executed on a case-by-case basis. There are
too many variables to devise a contingency plan that may secure

a good produce or a good catch at the end of the day.
Wages in the sector have increased steadily throughout
the years, alongside the increase in prices of raw materials
and agrochemicals and the increase in the cost of living. The
Agriculture Census of 2001 reported that most full-time workers
were family members, and so they do not receive a salary for
their work. From a total of 1,524 full-timers, 83.9 per cent are
unpaid family workers, 7.4 per cent are paid family workers and
the remaining 8.7 per cent are non-family paid workers.
Motivation, Control and Commitment
Prior to accession to the EU, import tariffs and production quotas

protected Maltese agriculture. This protection, in turn, led to
unsustainable practices, which had repercussions once Malta
joined the EU. Consequently, the lifting of levies on imported
goods threatened local produce, leading to drastic changes in the
agricultural market. The work of farmers and breeders had focused
on output and quantity with little regard for product quality. The
laissez-faire attitude was somewhat tolerated because of the low
prices of local produce. However, with the free movement of goods
following EU accession in 2004, the Maltese consumer discovered a
new world of imported products, some of which were even cheaper
than local ones. This set back local agriculture; farmers, breeders
and local agrifood industries were obliged to consider the quality
of their products, and seek to better appeal to the consumer. On
the other hand, whereas in the past the Government had applied
protectionist measures to the local agriculture and fishing
communities, today the drive is towards incentives and schemes
in line with EU programmes to promote quality products. In 2014,
a campaign for the Quality Mark on local products was launched.
This seeks to promote local produce through a standard which
reflects product specifications, appropriate labelling and a control
system on its production line (Dimech, 2015).
Due to a decline in the number of young farmers (Rovný,

2016), a measure was introduced in 2017 within the current
Malta’s Rural Development Programme 2014-2020, to encourage
young farmers who may wish to develop a career within these
sectors. This incentive helps farmers aged forty years or younger
to start their own business as a sustainable agricultural holding
(Funds and Programmes Division, 2016).
Gender, Age and Culture
Full and part-time employment in agriculture and fisheries

in Malta is dominated by males, but the number of females
is on the rise. Overall, the number of males and females has
increased by 18% and 41% respectively between 1983 and
2013. This number includes employees working at their family
business, in other private sector firms and within the public
sector. There is a gendered division of labour. For example, in
the sheep and goat cottage industry, the husband provides all
the necessary conditions to maintain a healthy herd while the
wife engages in cheeselet production. A project co-funded by
EU-ERDF investigated the socio-economic role of women in
the process of dairy production, especially cheese-making as
a cottage industry. A number of women (28) were interviewed
and engaged in several activities organised within the project.
Women who decided to engage in agriculture enrich their family
business with their contribution. The agricultural business,
more than other economic sectors, allows these women to plan
their family and personal life more conveniently when compared
to the time spent daily at work in any other full-time job. This
flexibility is appreciated, especially when they spend time with
their young children at the farm. Sixty-six per cent of women
are involved in the business, whereas the rest mainly take care
only of the household. For 85% of the women, cheese making is
the main source of income, a practice which offers a high degree
of satisfaction. This activity is carried out in line with cultural
traditions and passion, transmitting their practices to the

younger generation (Attard et al., 2013). Women may contribute
to the organisation of consortia and associations, which would
add value to the transformation of products at farm level. In
other agricultural activities, women also have an important role.
In the fruit and vegetable sector, women are involved in the
harvesting of the produce and the selling of the produce to the
local consumer. In the case of fisheries, women are involved in
the catching of fish and selling it to the consumer. The last two
activities describe the woman as the front person of the business,
promoting the product to the general consumer.
Most holdings are declared to be owned by males. However,
statistical values may not reflect the actual situation because
land obtained through inheritance by the wife is usually lumped,
showing the male as the sole holder.
In 2013, almost 85% of land title holders were over 45 years
of age (NSO, 2014). This reflects two important issues. When
siblings reach the age of 45, in most cases the father has reached
pensionable age and therefore the land title is passed on from
father to children. Second, young farmers in the business usually
work as employees with their parents; and so no activity is
registered under their name.
The percentage of the over-sixty age group has increased with
respect to 35-44 and 45-55 age groups, in both full and part-
time employment. There are several contributing factors to this.
Primarily the better medical standards and standard of living
keep the senior farmers engaged longer in the rural work than
before. This contributes to a shift in agricultural activities to
hobby farming. Younger farmers (less than 35 years of age) are
more engaged in part-time farming rather than the more risky
full-time farming. It is worth noting that the younger generation,
in general, is losing interest in family-run agricultural businesses
and are more inclined to find secure full-time jobs (Rovný, 2016).
The proportion of senior farmers may have increased because
there is nobody around to take over the work; these seniors are
indirectly obliged to keep on working. Rovný (2016) states that,
in Malta, the ratio of young farmers (< 35 years) to older farmers

(> 55 years) was 0.09:1 and 0.08:1, for 2007 and 2010 respectively.
In 2010, Malta ranked in thirteenth place with Italy, Netherlands
and Slovenia with respect to this ratio within the EU 27. Within
the fisheries sector, a similar scenario is happening with the
average fisher age being now over 50 and, although there are
young fishers who wish to pursue this work, the replacement
rate is falling short of retirees (Borg, 2017).
Diversity and Migrants in agriculture
Although there are no clear statistics on the migrant workforce,

a number of migrants are involved in agricultural and fisheries
activities. In accordance with the definition laid out in the
Labour Force Survey (2015), migrants include persons who have
resided in Malta for less than a year, including returning Maltese
migrants, EU citizens and also regular and irregular third country
citizens. The 2014 migrant workforce population was around
16,200, with 58% being males and 42% females. The percentage
of potential contributors to the working force, aging between 25
and 54 years, makes up 81.8% of all immigrant arrivals (NSO,
2015). Skilled manual workers (20%) may potentially contribute
towards the agricultural and fisheries workforce. Migrants may
also include a number of asylum seekers and refugees, who may
potentially work in agriculture in both Malta and Gozo. This is
often irregular and seasonal work (EPPO, 2016). One difficulty
migrants are facing is that a number of them would leave the open
centres and move to Gozo to work in agriculture there. However,
their job would be seasonal and they often find themselves in
difficulty with accommodation and money after the job is done.
Migrants recount more positive experiences while working in
agriculture in Gozo rather than in Malta (Gerada, 2018).
A number of asylum seekers and refugees were farmers in their
country of origin. Some had their own farm-business (poultry
farm, banana farm) while others worked within government
ministries related to agriculture and water management.

One major barrier is language. Migrants bring in changes in
agricultural practices and in the availability of agricultural
produce. Some migrant women grow some of their own food,
which is not conventionally found in Malta such as the bitter
melon which is a staple food for the sizeable Filipino community.
Due to its absence locally, they import seeds and grow this type
of melon in local fields. New food products are emerging from
several African shops throughout the island (Gerada, 2018). On
the other hand, fishing is more conservative than agriculture
and information on any changing practices driven by immigrant
workers is limited.
Education, Training and Development
In the 1990’s, there were only fifteen agronomists in Malta,

employed either with the public sector or in academia. The 2001
Census of Agriculture gives a clear picture of the educational
status of farmers at the time (NSO, 2003). Most farmers (14,110
or 79%) acquired their knowledge through practical experience.
Only 3.8 % declared that they had undergone some form of
training. In the 2010 Census of Agriculture (NSO, 2012), and the
agriculture and fisheries statistics for 2014 (NSO, 2016), there is
no mention of the educational background of the members of
the farming and fishing communities. Education is not perceived
as a fundamental component within the sector. In spite of this,
education in agriculture and fisheries has persisted throughout
the years. Agricultural education in Malta can be divided into
three categories; secondary, post-secondary and tertiary.
In 1948, Maltese co-operatives faced several managerial and
financial problems. This led experts, of the Food and Agriculture
Organisation (FAO) of the United Nations, to recommend that
a group specialised personnel should be sent to Malta to train
farmers, particularly young farmers, through a dedicated school
(FAO, 1955). Agricultural education in Malta was originally based
at a secondary agricultural school “Skola tal-Biedja” and the

post-secondary College of Agriculture in the government farm
at Għammieri, limits of Qormi. Then, following the restructuring
of the educational system in the 1990s, this unit was upgraded to
the Agribusiness Centre within MCAST (the national vocational
college), but leaving pre-16-year-old students who wished to
pursue agribusiness as part of their studies with nowhere to
go. Consequently, in 2013, a vocational education and training
(VET) option in agribusiness was introduced in secondary
schools. This option was set up to encourage students interested
in agribusiness to study this subject in a formal manner, while
continuing studies in other academic subjects. Four colleges in
Malta and Gozo – namely, Maria Regina College, St Ignatius
College and Gozo College and the Archbishop’s Seminary (a
church school) – are offering this VET agribusiness course to
their students. The number of such students has been on the
rise: from seven in 2014/5 to 67 in 2017/8 (Muscat, 2018).
The MCAST Centre for Agriculture, Aquatics & Animal
Sciences offers a number of vocational courses in horticulture,
animal care and fish husbandry. Such courses lead to a number
of positions within both public and private sectors. These include
agricultural officers, laboratory analysts, farm inspectors, zoo
keepers, pet shop assistants, veterinary nurses, groomers, equine
attendants, farm hands, winery attendants, turf managers,
gardeners, florists, agri-retail attendants, fish vessel inspectors,
fish farm attendants, fisheries officers, aquarium shop attendants
and public aquarium attendants.
The concept of tertiary agricultural education in Malta
was first put forward in 1988 during an FAO mission, which
was aimed at assessing the state of Maltese agriculture and
fisheries (Bonanno, 1993). In 1993, the Institute of Agriculture
was established within the University of Malta. By 1995, four
agricultural courses were introduced at the Institute, a Diploma
in Agriculture, a Master of Science in Agricultural Sciences, a
Master of Science in Agricultural and Veterinary Pharmacy and
a Master of Philosophy in Agriculture. One of the aims of the
then Institute was to attract the sons and daughters of Maltese

farmers. The University of Malta conferred 372 diplomas and
degrees on 310 graduates (218 males; 92 females) between
1995 and 2018. The highest percentage of these students (40.6
%) are diploma graduates. Most of these students, including
those from the farming community, secured a job within the
state agricultural sector. A fifth of these graduates returned
to University to pursue further studies at a higher level. In
2010/2011 and 2015/16, the percentage of students who enrolled
at University within agricultural courses represented 0.37 and
0.12 per cent of the total student population respectively (NSO,
2017b).
Cooperatives, associations and organisations in Malta
Agricultural and fishery cooperatives, associations and

organisations were set up in Malta to assist farmers and fishers
in their daily activities and to ensure a fair pay in return of
their work. In 1847, due to hunger, poverty and unfavourable
climatic conditions, farmers were urged to become members
in an organisation called the Society in Relief of the Farmers
of Malta and Gozo (Società in Sollievo dei Gabelotti di Malta
e Gozo) (Galea, 2012). This was indeed the first organisation to
unite farmers. Following the Co-operative Societies Ordinance
of 1946, the first agricultural cooperatives were registered in
1947, hundred years after the formation of the first organisation.
Thereafter several agricultural, livestock and fisheries
cooperatives followed. Such cooperatives form the backbone of
the workforce in agriculture and fisheries in Malta.
One of the first to be set up was the Farmers’ Central Co-
operative Society (FCCS), a secondary cooperative, made up
of representatives of seven primary cooperatives. Smaller
cooperatives emerged along the years, which were usually
village based. The farmers of several rural villages felt the need
to team up and carry out agricultural retail activities at local
level, bypassing middlemen. Village-based cooperatives, that

were set up in 1947, include those at Mellieħa, St. Paul’s Bay,
Rabat, Siġġiewi, Żabbar, Żebbuġ, Gozo, and later Dingli, Mġarr
and Qormi. The Central Farmers’ Cooperative Society (FCCS)
was involved in the promotion of processed products. One
instance occured in 1960, when the local tomatoes were being
sold at a very cheap price. This cooperative decided to open a
tomato paste (kunserva) factory. This was mainly operating in
Gozo by the Gozo Farmers’ Cooperative Association, which
in 1993, against the will of the members, was handed over to
a private company, safeguarding the tomato growers’ income
(Galea, 2012). In the past, the FCCS operated at Marsa and
Valletta, but nowadays it is located at the produce wholesale
market, locally known as Il-Pitkalija, Ta’ Qali, Attard. In 2004,
the number of farmer members was 946. The FCCS at the Ta’
Qali market competes with 18 other private brokers, whose
share is 75% of the total agricultural produce. Some 50% of the
farmers who take their produce to the Ta’ Qali market, are FCCS
members; but this cooperative has just 25% of the share of the
landed produce: this suggests that there are issues that need to be
addressed at FCCS managerial level (Walker, 2004). The Gozitan
community felt the need for a cooperative of its own and in 1959,
the Gozo Agricultural Cooperative (Gozitano) was set up. This
cooperative, which now has some 500 farmers as members, has
a similar function to the FCCS (Walker, 2004).
The Agricultural Cooperative (Agricoop) was set up in 1965,
to assist and support farmers with the importation of agricultural
tools, machinery and agrochemicals. At present, this cooperative
has 968 members. Another agricultural cooperative specialising
in viticulture was set up in 1981, as the “Farmers’ (Wine) Co-
operative Society; it ceased functioning in 2014 (TMGG, 2014).
In 2006, a viticulture producer organisation, VitiMalta, was
formed and today it has some 274 affiliated farmers.
Practices within the crop sector are very complex and diverse.
Needless to say, farmers within the same rural community have
different specialisations. This depends mainly on the specific
knowledge they acquired from their ancestors or through other

sources, and on the financial status of the farming family. Some
farmers have invested in greenhouses, others use tunnel systems,
hydroponics and other technologies, while others use more
traditional methods. Therefore, within the same cooperative,
members are growing different crops, with perhaps different
technologies. This creates a high degree of heterogeneity within
the operations of the cooperative, leading to diverse opinions
and priorities amongst its members. This may be the Achilles
heel of such agricultural cooperatives. Specialized cooperatives
tend to be more successful and economically feasible. This would
apply, for example, for grapes for winemaking or olives for oil
production.
However, success in such specialised cooperatives also
depends on the administrative and management aspects of such
cooperatives. The producers are the specialists for the day-to-day
running of the agricultural operations but most often, they lack
the managerial and administrative skills. This lacuna leads to the
engagement of ‘non-farmer’ personnel who may be specialists
in accounting, management and law, but may significantly lack
the technical skills which farmers possess and logistically the
cooperative may not function well.
Cooperatives for animal husbandry have proved to be more
stable and successful. Such cooperatives are more specialized and
focus on one or two animal species. The two main cooperatives
here, established in 1958 and 1983 respectively, are the Milk
Producers Coop or KPH (Koperattiva Produtturi tal-Ħalib)
and the Pig Breeders Coop or KIM (Koperattiva ta’ min Irabbi
l-Majjal). These cooperatives were set up to reduce the costs
of imported feeds by a system of bulk buying and to assist the
producers when dealing for a fair price for their produce.
Due to cases of undulant fever, associated with milk
contamination with Brucella melitensis discovered by Sir David
Bruce and its transmission by Sir Themistocles (Temi) Zammit,
milk street vending was under threat. In 1938, the Centre for
Milk Pasteurisation was set up and the goats’ milk vendors
united to form the Goats’ Milk Vendors Association (Għaqda

tal-Bejjiegħa tal-Ħalib tal-Mogħoż). In 1957, when the cases of
brucellosis fell drastically, milk production was on the increase
leading to a milk surplus. Consequently, a cooperative, Malta
Milk Producers Co-operative Society Limited was set up to liaise
between the milk producers and the Milk Market Undertaking
(MMU). Initially, MMU insisted on conducting agreements
with individual producers but the co-operative insisted that it
should negotiate with MMU, on behalf of the producers. Today,
this cooperative is known as the Milk Producers Coop or KPH
(Galea, 2012). KPH incorporates all 93 local milk producers (54
in Malta, 39 in Gozo), delivering milk to its subsidiary dairy
processing unit, Malta Dairy Products or MDP. KPH owns a
feed mill, manufacturing a vast array of high-quality nutritional
products for livestock. KPH strives to sustain and improve the
economic and social interests of its members, and develop the
milk sector in Malta (Tonna, 2018).
When the swine industry reached an unsustainable state,
KIM was set up, assuming control of the nucleus herd at
Comino, maintaining and improving the swine genetic pool and
managing slaughtering protocols. The cooperative, made up of
170 members, played an important role in Malta’s negotiations
with the European Union. In 1964, the National Co-operative
of Poultry Breeders Limited was registered but within five years
it was liquidated. Another attempt to safeguard the poultry
sector was in 2000 by the setting up of the Poultry Co-Op. The
survival of cooperatives and organisations depend on various
factors, particularly international and domestic market trends,
economic feasibility of the represented sector and the labour
force within the sector. This cooperative has not yet acquired the
necessary experience for survival when compared to the other,
longer-established cooperatives (Camilleri, 2004).
Two specialised organisations have been set up recently
within the animal husbandry sector. The first is the Sheep
and Goat Producers Association (Xirka tal-Produtturi tan-
Nagħaġ u l-Mogħoż), established in 2013. This organisation is
made up of around 130 members who breed sheep and goats

for milk and cheeselet production. The sheep and goat sector
is more fragmented than the dairy cow sector, as the product
has more potential at the farm level rather than at an organised
centralised establishment. In fact, dairy sheep and goat products
are considered as cottage products while dairy cow products are
industrial and are all processed at MDP. The bringing together
of sheep and goat breeders through an EU-funded project led
to the identification of the main quality characteristics of the
cheeselet and the traditional sheep cheeselet market (Morales et
al., 2017). The information available on the product is sufficient
for the organisation to apply for certification of the product at
local or EU level.
Another organisation is the Malta Beekeepers Association.
The association is made up of 120 members, most of whom are
part-time beekeepers but process honey as a cottage product. A
joint collaboration between the beekeepers and the University of
Malta, led to the identification of the honey quality parameters
(Attard and Bugeja-Douglas, 2017), in line with the Council
Directive relating to honey (2001/110/EC). The assocation is
now in a position to apply for a local or EU certification.
Fisheries cooperatives function in a similar way to the
animal husbandry cooperatives. The first two associations,
set up between 1891 and 1919, were the Marsaxlokk Fishers
Association (L-Għaqda Sajjieda Xlukkajri) and the Maltese
Fisheries Society (ix-Xirka Maltija tas-Sajd). Following the
Co-operative Societies Ordinance of 1946, the first fisheries
cooperative to be set up was in 1964, as the Fisheries Cooperative
(Għaqda Koperattiva tas-Sajd). The main role of the cooperative
was to organise fishers and reduce the costs of imported Atlantic
mackerel bait for swordfish and tuna fishing. This cooperative
accepted both full-time and part-time fishers. In 1991, a second
cooperative, the National Fisheries Cooperative (Koperattiva
Nazzjonali tas-Sajd) was set up for full-time fishers only. Both
cooperatives perform more or less the same functions. However,
whilst these cooperatives may guarantee timely payments, their
members may have different opinions and priorities, as was

discussed in the crop sector. For example, swordfish and tuna
fishers may have different interests from the dolphin fish fishers.
Different interests may arise between owners of trawlers and
traditional fishers. Besides, different fishers invest in different
fishery technologies (Portanier, 2004). This diversity may create
problems and opinions within cooperatives.
Along the years, a number of voluntary organisations have
been set up to help farmers and breeders to promote Maltese
agriculture. In 1999, the Malta Organic Agriculture Movement
was set up as an independent and voluntary organisation to
assist farmers who wished to convert to organic agriculture,
and to promote ideas and information about organic farming to
the general public. In 2013, Malta Youth in Agriculture (MaYA)
was officially set up as a voluntary association to support young
farmers as well as youths studying or working in agriculture.
A prevailing mentality amongst local farmers, breeders
and fishers is that economic benefits are best secured through
individual competition. With the accession of Malta to the EU in
2004, the situation changed from a local competition protected
by levies on potentially competitive foreign products, to one open
to regional and global competition. Local farmers, breeders and
fishers need to work more collaboratively to safeguard the future
of their livelihoods, their industries and a sense of food security.
Climate change and agricultural and fishery activities
Environmental changes and human activities affect each other

mutually. Such activities include agriculture and fisheries. The
industrial revolution and the fast growing human population
resulted in a huge impact on the environment and natural
resources. The changes in the environment resulted in several
impacts on human activities. These have affected populations
worldwide, but small islands are more vulnerable to such
effects (Baldacchino & Galdies, 2015), which are exacerbated
by limitations in adaptation and mitigation actions. In part,

the dramatic decrease in total UAA over the years is attributed
to drought and an increase in temperature. This has led to the
decline in crop productivity and the work force within the
agricultural sector as mentioned above. Within the fisheries
sector particularly artisanal fishing, the scenario is different
though the net outcomes are very similar to those in agriculture.
The impacts of climate change on commercial fish stocks has
not been well investigated yet in terms of quantities. However,
several factors that apparently show an effect include the increase
in the mean sea temperatures, with the subsequent decline in the
indigenous fish populations, an increase in invasive alien marine
species, an increase in disease outbreaks and a shift in fish
distribution within the Mediterranean region (Knittweis, 2015).
Conclusion
Land and sea-based food operations have survived several

centuries and perhaps these characteristics have made Malta
renowned for its Mediterranean-oriented traditional diet.
However, with new technological improvements and new
food hygiene and animal welfare regulations, some traditional
practices may need to adjust to remain acceptable. There is
also a need for adaptation and mitigation in these operations.
Producers and fishers need to adapt to the current market trends
and demands by the local and foreign consumers, taking into
account effects from other anthropogenic activities and climate
change. The farmers need to invest their energies and resources
to improve techniques with the renonwed local crop land races
(Laghetti et al., 2004) and invest their activities in ‘climatically-
adaptable’ crops. In the past, most of the crop harvest, rearing of
animals and fish catches were meant for subsistence rather than
the market, hence having minimal economic value. With time,
agriculture and fisheries have gained economic status, from the
qualitative rather than the quantitative persepective. Nowadays,
such activities provide only a fraction of the gross domestic

product, but their continuation has a four-fold benefit: the
revival and continuation of old traditions, sustainability and care
for the environment, a promising side industry that promotes
local cuisine and slow food for the hospitality sector, and a
source of job opportunities. However, the farming and fishery
communities are aware that if they want to retain sustainability
within the respective sectors, they need to upgrade their field,
farm and fishery operations. Trends discussed within show that
only the open-minded and perseveriant farmers, breeders and
fishers have survived the test of time.
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Construction:
The Engine of Development?
Rita Sant
The construction industry is often portrayed as a sector with

weak people management practices despite its size and socio-
economic significance. It remains a poorly understood industry
and very little research exists on its HRM practices. Moreover,
the applicability of mainstream HRM theory is limited when
it comes to managing people within such a complicated and
challenging arena (Dainty et al., 2013). This chapter frames
a debate around HRM in the construction sector by exposing
both the nature of the industry and its HRM practices to greater,
critical scrutiny.
The Construction Sector
The construction sector is highly fragmented and heterogeneous.

Construction work is very labour intensive in a project-based
environment most often subject to very tight deadlines.
Contractors are continuously under pressure to win projects. Due
to declining profits and increasing costs, contractors struggle to
include the costs of training the next generation of construction

workers in their tenders while remaining competitive. The same
argument applies to the additional costs of direct employment.
Labour is often seen as a cost to be minimised. Construction
projects are represented as chaotic, ambiguous, complex
and unpredictable multi-party coalitions characterised by
“Interdependence and Uncertainty” (Chricton, 1966). The
temporary multi-organisation of the construction project is a
logistic nightmare, bringing together participants from many
local and foreign organisations with potentially conflicting
priorities, making the interactions between people even more
complex. The construction product is large and very often has
to be assembled on site, at the point of consumption, making
construction work highly geographically dispersed. Competitive
tendering adds to the uncertainty and fluctuating volumes,
timings, types and locations of work. Construction projects tend
to be very large relative to the size of the firms, frequently with
high-risk levels. The workers move from firm to firm and from
place to place, depending on who wins the contracts for works.
A brief review of the European and the Maltese construction
context is highly warranted at this stage.
The European Context

In the European context, construction is one of the largest sectors
of activity; however, it has been hit hard by tighter access to credit
since the global economic recession of 2007. This implies that
the strongly integrated sector’s performance impacts directly on
the overall economy. This downturn led to a shortfall of skilled
workers, unattractive working conditions and a high incidence of
undeclared or nonstandard work. Construction employment has
declined steadily in the EU, from 18.6 million in 2008 to less than
15 million in 2014. Another Eurostat report highlights that the
latter figure is relatively higher however, as undeclared work is a
widespread practice in several member states (Eurofound, 2015)
European countries share a similar construction workforce. It
is dominated by 24-54 year-old males and composed mostly of
Construction: The Engine of Development? 247
self-employed manual workers, with other workers on fixed term

or standard employment contracts with SMEs. Women make 8%
of those employed in the EU construction sector (Eurofound,
2009).
The Maltese Construction Industry

In the case of Malta, we have little information about construction
practices in Maltese prehistory and early history, except for
the impressive megalithic temples, the oldest free-standing
architectural structures in the world. We know much more
about building practices in Malta after the Knights of St John
occupied the islands in 1530. During that period, the Maltese
construction worker quarried the stone on site, cut it to size,
dressed it and placed it in place, creating the magnificent bastions
and fortifications that surround the major cities of Valletta,
Mdina, Cospicua, Birgu, Senglea and Kalkara. Back then, all
work was done manually, with minimal plant and tools. It was
very time consuming and extremely labour intensive. Limestone
was the main resource used on Maltese construction sites and
remained so up to the late nineties. Over the last two decades,
as a result of large foreign investment, this building trend has
changed dramatically. Local construction projects have become
larger, buildings are reaching new heights meaning that concrete
materials and occasionally steel have replaced the single and
very limited building resource: the globigerina limestone block
(tal-franka).
The local construction sector is today dominated by small
firms employing less than 10 to 20 people, a few firms employing
less than 50 people and very few larger firms employing more than
250 employees. SMEs play an important role in construction-
related work, employing 73% of the construction workforce.
These account for the majority of the industry’s productive
capabilities. According to the European construction sector
observatory report (March 2018), the number of enterprises in
the local construction sector totaled 3,535 in 2016. Production in
construction increased by 23.6% between 2010 and 2016 and the
turnover reached €1.4 billion, a 33.5% increase over 2011 figures.

The total added value of the construction sector amounted to
€283.6 million. In 2016, the share of gross value added of the whole
sector to the national GDP reached 8.1%. Labour productivity in
the construction sector registered an increase of 40.2% percent
from 2010 to 2016. However, the number of those employed in
the construction sector amounted to 8,629 in 2016, registering
a decline of 18.2% on the 2011 figures. The large construction
companies in particular have a declining significance as
direct employers. The same report highlights that the Maltese
construction sector suffers from both labour and skills shortages
particularly with respect to concreters, thus affecting the ability
to carry out the numerous projects in the pipeline. The latter has
contributed to the increase in the construction cost index which
registered an increase of 11.7% over the six-year period, mainly
due to a 16.5% increase in labour costs. The report also highlights
that there was a decline of 4.8% in craft and trade workers and
an 18.2% in elementary occupations in the sector. Conversely,
there was an 11.1% increase in plant and machine operators and
assemblers and a 50% increase in associate professionals. The
number of self-employed in the construction sector declined by
7.5%, whilst the number of self-employed in the real estate sector
registered a 25% increase over the same period.
The sector is also experiencing increased pressures in terms
of labour and skills shortages going forward as large-scale
public infrastructure projects have been launched. The current
construction workforce lacks the capacity as well as the necessary
experience to carry out such projects. Furthermore, the Maltese
construction worker has the least opportunity to work abroad.
Nevertheless, the shortage of skilled workers and the ever
dwindling number of Maltese construction workers renders it
more difficult for local companies to make reasonable profits.
Between 2013-7, the country’s average economic growth was
around 6.4% annually. More than 40,000 foreign workers have
come to the island since Malta joined the EU in 2004. According
to Clyde Caruana, Head of Jobs Plus at the time of writing,
the Maltese labour force potential has been maximised with a

number of measures that attracted thousands of foreign workers
to augment the local workforce. He argues that proposals on
Malta’s labour force requirements have been prepared and
attracting thousands of foreigners is a top priority as otherwise
the economy would seize up. He argues that, according to
employment statistics, only 10% of foreigners that entered Malta
up to 2010 have remained on the island. This implies that the vast
majority leave the country relatively quickly. He recommends
the attraction of unemployed Europeans to meet the Maltese
economy’s requirements, making use of bilateral agreements
with countries that have high unemployment figures.
On the other hand, Perit David Xuereb, CEO at QP
Management, recently argued that the industry is not sufficiently
prepared to manage the influx of overseas workers and better
regulation, education and certification protocols are necessary.
To address this issue, the Building Industry Consultative Council
launched the skill card system to facilitate the recognition of
qualifications and skills of construction workers (Micallef, 2017).
By issuing cards to skilled workers who attend the respective
skills training, the system has made it easier for employers to
recognize the skilled worker.
Construction Culture
The typical construction scenario includes the building site, the

coordination of works and the people at the construction site
and employment agencies that make labour available in this
sector. A quick look at each helps to orient the reader better as
to the realities framing the construction culture.
The building site – The building site is one of the few remaining
workplaces where there is no obligation to be polite, or to dress
smartly. There is an occupational culture that takes pride in
physical strength, machismo and raw toughness. For managers

to be accepted and respected on the building site, they are
occasionally expected to roll up their sleeves and dirty up their
hands.
HR manager versus Project manager – There also exist basic

contradictions within this sector where employers must treat
employees as exploitable resources and yet, at the same time,
need to maintain good relationships with them as human beings
in order to retain their attachment to the organisation. In this
scenario, one has to keep in mind the poor education standards
and the low self-esteem of certain construction workers. Very
few managers understand what the construction worker
feels working in difficult site conditions subject to all external
elements. When working in such a scenario of different cultures
composed of diverse people with very distinctive ideas and
needs, the project manager’s experience and motivation comes
significantly into play. Against this background, HR managers
are not seen as doing real work, but are perceived as useless
paper pushers. Hence HRM is often misconstrued as a devious,
underhand, dishonest and deceitful practice; representing
a bureaucratic rule-bound culture which encroaches on the
construction site. The HR manager presents a polite smiling
face whilst at the same time using backstabbing techniques.
This contrasts with site project managers who are perceived to
be frank, straightforward, and no nonsense professionals. Most
site managers prefer to engage persons who they have previously
worked with, or who are recommended by other skilled workers
or subcontractors. Moreover, construction employers tend to
invest in a project manager rather than employ an HR manager.
The latter is often seen as an overhead cost, with no direct reliable
input to the construction project. HRM objective criteria such
as qualifications, interviews or formal references do not work
in this fast track, fast pace environment. In the local scenario,
only large construction companies or consortia can afford to
employ an HR manager. Otherwise, the norm is to employ a
payroll clerk to see to the day to day running of the HR office,

taking note of the time sheets, sick leave and vacation leave, as
well as the payroll system and that all required work permits
and employment/termination paperwork are in hand and in full
compliance with employment law. There is no time for executing
any other HR policies, such as recruitment and training. Thus,
recruitment is frequently out-sourced.
Employment agencies – Furthermore, the nature of the

competitive tendering process - whereby construction contracts
are won and mobilisation has to be made within a very short
period of time – leaves little room for interviewing and
engaging employees. Thus, most construction employers turn to
employment agencies which, in turn, may import the required
skilled personnel for the specific contracted job.
Construction HRM
Before proceeding to discussing the HRM theory that is likely

to be embedded in the Maltese construction industry, there is
a need to understand the human resource composition of the
construction site proper. Operatives account for 80% of the
construction site personnel on large projects. The other 20%
consists of the project manager, the construction site managers,
the quality assurance manager, the quantity surveyor, the land
surveyor, the health and safety officer, trades supervisors/
foremen as well as site technical and administrative office staff.
The construction sector in Malta is extremely male-dominated:
only 1% of the local workforce is female. Most of these are either
professionals or employed as office-based administration staff.
Gale and Davidson (2006) argue that the building site can be a
tough and frightening environment for some women. On the
other hand, Ness and Green (2012, p. 11) argue that “those women
who persevere tend to be those who ‘fit in’ with the culture, enjoy
work and become committed to the industry”.
Maltese construction workers – Maltese society’s broad view

of construction work is that it is dirty, dangerous and for the
unskilled. Construction work has to be performed outside,
subject to all weather elements, and the hot summer sun is the
ultimate culprit of local repulsion. Thus, over the years, the
number of Maltese construction workers has been diminishing.
Construction is perceived contemptuously as hard, tough, dirty
work with relatively unattractive working conditions by the local
young generation and their families. Moreover, building projects
have become more complex, enforcing the need for trained and
skilled workers. On-the-job training has almost disappeared as
very tight deadlines continuously demand higher productivity,
leaving no time for this training. This lack of training is also
contributing to an ageing Maltese construction workforce.
Foreign workers – In such a scenario, the employment of foreign

workers has become increasingly inevitable. The National
Skills Survey for 2017 confirms that the highest recruitment
of foreigners in the previous three years by sector was in
construction. Some argue that foreigners are very well prepared
for work and the majority are humble, hardworking and punctual.
Moreover, skilled workers have a better job understanding, tend
to be more appreciative and articulate when working. Unlike
their Maltese counterparts, foreigners are highly motivated and
complacent during the job. On the other hand, others argue that
employers are more satisfied with foreigners as these accept
lower wages and their attitude tends to be better than the locals.
Foreigners are more hardworking and loyal as they are actively
seeking work. The negligible difference in employer satisfaction
between Foreign and Maltese employees implies that the Maltese
workers are also hard working. (Jobsplus, 2016)
Migrants – the influx of migrants has helped to fill labour

shortages in the local construction industry. Already in 2014, 13%
of the workforce in the construction sector consisted of migrants
(Central Bank of Malta, 2015). However, determining the exact
number of migrant workers in construction is problematic as

many are employed unofficially on a daily basis and paid cash
in hand.
Subcontractors – many construction projects are characterised

by chains of subcontracting that end in a workforce that is
notionally self-employed. It follows that many subcontracting
firms have no HRM policy for manual workers.
Sub-contracting and self-employment have long played an
important role in this industry but have increased dramatically
in recent years. The Maltese construction industry relies on
nominally self-employed labour, much of which is supplied
through labour agencies or labour-only subcontractors. Raiden
(2007) suggest that the concept of multi-tier contracting covers
a reality of workers starved of employment benefits, job security
and feeds the low-cost, low skill, low-productivity culture which
pervades the sector.
It follows that human resources on construction sites consist
of both directly employed and indirectly employed labour. It is
not simply a matter of telling directly employed human resources
what to do; people may need to be cajoled, persuaded, bribed or
bullied. This project based employment environment can create
personal and familial financial insecurity and stress. (Warhurst,
2008). Some workers have to travel long distances or to work
away from home for long periods, making it difficult for them to
achieve a satisfactory work-life balance. For some, moving from
project to project, working in new places and with new people,
is one of the attractions of the work but it can also be a source of
stress and insecurity.
The outsourcing undertaken on projects has had significant
implications for both the definition of skills (Dainty & Chan,
2011) and the actual employment of labour which tends to
be discarded once levels of demand change. Labour is usually
employed for only as long as is necessary through subcontracting
chains. HRM strategies are hard to implement as organisations
are unable to control processes over which they lack longer-term
direct responsibility. Ford and MacKenzie (2007) argue that

this scenario has shaped the casual nature of the employment
relationship. Employees and employers have little loyalty
towards each other, very often moving between employment
opportunities as they emerge. In the absence of work, workers
are obliged to leave the industry altogether. The need for
flexibility limits the scope for stable, permanent employment and
for workforce planning. When workloads cannot be predicted
more than a few months ahead, it is not surprising that strategic
approaches to managing human resources seem to be few and
far between, and that firms are reluctant to invest in training and
development.
Bosch and Philips (2013) distinguish between two models of
how construction industries have taken divergent paths to the
common challenges of competition, unpredictable demand and
ageing labour forces. The ‘high road’ model presents the more
regulated highly coordinated construction industry which tends
to be ‘human capital intensive’, technologically dynamic and
characterised by intense state and sectoral involvement in training
and labour market coordination. Construction companies in
France, Germany, the Netherlands and Scandinavia pursue
‘high road’ models where qualifications and formal training are
essential, wages are set on the basis of collective agreements and
employment is generally direct. Workers are classified and paid
according to their qualifications and experience. They can enjoy
substantial job security and climb a hierarchical ladder.
On the other hand, the ‘low road’ model presents low wage,
low skill, low technology construction industry characterised
by extensive subcontracting, temporary/agency workers, self-
employment and high labour turnover. Greece, Italy, Portugal,
Spain and the United Kingdom have adopted this ‘low road’ path
where labour is employed casually from one project to another,
firms are small and self-employment is high. Official collectively
bargained wage rates may exist; but in practice, earnings tend
to be related to output rather than skills and qualifications.
The ‘low road’ model gives companies the flexibility to respond
to changing market conditions as well as reduce labour costs,

offload risks and allow them to pay purely according to output.
This model has adverse implications for training, productivity
and quality. It reduces the firm’s ability to organise and manage
labour. The multi-layered subcontracting and competition
between labour-only gangs makes co-ordination of site work
difficult and chaos becomes the norm (Clark, et al., 2008; Forde
& McKenzie, 2007).
In Malta, the construction industry is following the low
road path where direct labour is decreasing and subcontracting
is increasing. The situation may not be in the best interest of
construction firms; but, within the wider economic scenario,
the (de)regulatory framework and in the absence of contractors’
classifications, they have little choice. If competitors can win
tenders by offloading part of the risks and costs of employment
onto workers or society at large, thus reducing labour costs by 20
to 30% (Harvey, 2003), then it is difficult for any individual firm to
take a longer term view by employing workers directly and invest
in their health and wellbeing. And workers have grown not to
expect otherwise. This reinforces the vicious cycle towards a low
wage, low skill, low productivity, low tech and low commitment
construction industry which externalises many of its costs.
Cost of Labour in the Construction Industry
The ‘commitment to people’ HRM approach is at odds with the

choices of construction companies in favour of flexibility. Labour
is treated primarily as a cost, and competitive advantage means
cost-cutting. There is little recognition of people’s knowledge,
skills, talent and experience as a source of competitive advantage
(Ness & Green, 2012).
As most large construction companies choose more
subcontracting, their return on capital does not depend on
productive efficiency, but on supply-chain management and the
manipulation of payments. These contractors are progressively
moving from the physical work of construction, choosing instead

to concentrate on ‘project management’ as this is held to be more
profitable than actually employing people to build things. Further
responsibility for the employment and training of skilled workers
is delegated down multi-layered supply chains to small firms.
Training – Legge (2005) suggests that the emergence of HRM as

an ‘enlightened’ practice is something which is more at home with
managers than manual workers. Firms who do not directly employ
site operatives often lack training and development policies for the
workers engaged by the subcontractors to whom they contract the
work. HRM policies are hence restricted to professional, managerial
and administrative staff. On the other hand, due to the large number
of commitments with tight deadlines, the subcontractor has very
little time to spare for the training and development of staff. This
leads to the growth of huge disparities in status and reward. Manual
workers are engaged at arm’s length, contributing to their invisibility.
A pure market relationship reduces labour to a mere commodity.
Firms are more concerned with price relations and production,
rather than labour and employment relations. The employment
relationship is weakened in such a stark scenario. The contractual
point of view replaces the human point of view. In such an arena,
the operative is treated as a repository of labour power, to be given
anything but the minimum of training to comply with regulations.
Cost Cutting – By opting for a contractual relationship instead of a

direct employment relationship, companies do not merely cut costs
but offload huge amount of risk. Responsibility for employment
issues is simply passed on down the line through the supply chain;
so workers, as independent contractors, become responsible for
their own safety and at the same time are excluded from the remit of
HRM practice. In the construction sector, this involves complying
with the basic requirements of employment law.
Direct Labour – this is a form of employment contract where the

contractor employs the worker on a full time or part time basis
usually through a form of a definite or indefinite contract at an

agreed amount of weekly wage or monthly salary. The contractor
is responsible for complying with all employment regulations
and provides the employee with sick leave and vacation leave
entitlements and national insurance coverage. Labour charge-
out rates are the actual hourly rates paid to the worker with a
correction factor to include an allowance for sick leave, vacation
leave, national insurance contributions and other bonuses and
benefits. Table 1 shows the charge-out rates for the different
skilled workers and site management workers in 2014 and 2017 in
the local construction industry. As a consequence of the current
nation-wide skills shortage, the charge-out rate for this group of
workers has shot upwards by 36% over a four-year period.
Table 1: Construction sector: Workers charge-out rates.
Construction Sector Charge out rate €/hr

Skills Group 2014 2017 % increase
Steel Fixers €8.00 €10.35 29.38
Shutter Workers €9.72 €11.50 18.31
Concreters €9.72 €10.00 2.88
Masons €9.72 €11.50 18.31
Stone Dresser (Manwal- Naġġar) €8.00 €10.69 33.63
Semi-Skilled Workers €7.00 €9.50 35.71
Site Management 2015 2017 % increase

Project Managers €26.57 €28.00 5.38
Site Managers €22.10 €23.40 5.88
Land Surveyors €15.28 €16.00 4.71
Site Foremen €12.89 €14.95 15.98
Health and Safety Officers €12.10 €14.00 15.70
Site Administrators €21.00 €23.00 9.52
Site Quantity Surveyors €18.20 €19.50 7.14
Document Controllers €12.90 €14.00 8.53
Labour in construction takes two forms: namely lump labour

and piece work labour. Lump labour is a form of wage contract
where the contractor hires on a labour-only basis and pays
workers an agreed lump sum for an agreed amount of work.
These self-employed workers perform the same tasks on site
as the directly employed workers; but they have a distinct legal
and tax status. The contractor hiring lump sum labour has no
responsibility in terms of income tax deduction, payment of
national insurance contributions, vacation leave pay, sick leave
pay or other costs normally paid by an employer. Value added
tax has to be charged.
On the other hand, piece work labour (xogħol bl-imqieta
in Maltese) is a form of employment contract whereby the
contractor hires on a works basis and pay workers a measured
sum for the agreed amount of work carried out to an agreed
production output on a pre agreed set of rates for example
workers are paid at a rate of €13 per metre run of reinforced
concrete beam. Once work is completed, it is measured and, for
a 100 metre of beam length, workers are paid €1,300. In this way
the contractor passes on the risk to the worker as the latter is not
paid for any time lost during the production process.
Health and Safety at Work
Occupational health and safety (OHS) and workers’ wellbeing

is a vital element of the ethical and responsible management of
people; and the construction site is one of the most high-risk
work environments. This calls for a genuine commitment, will
and effort to improve occupational health and safety from all
involved in order for an OHS management system to work and
make a real difference on site. It has to be a primary responsibility
of all managers, CEO’s, first line supervisors, foremen and team
leaders. Once an OHS policy is integrated and explained to
all those involved, the activities of OHS officers would appear
relevant, coordinated and productive and the operation of an
OHS management system may very well meet its expectations.

Health is an important resource as it contributes to the economic
and social wellbeing of both workers and their families.
Greenwood (2002) argues that the way organisations treat
their workers is an issue that raises ethical concerns. The ‘right
to freedom’, the ‘right to wellbeing’ and the ‘right to equality’ are
three ethical principles for the management of people suggested
by Rowan (2000). In recognition of these rights, most developed
societies have passed legislation to protect workers’ health
and safety in and arising from work. According to Dr Mark
Gauci, the current CEO of the Maltese Occupational Health
& Safety Authority, most occupational fatalities that occur on
local construction sites occur because of falls from heights. The
OHSA reported 39 fatalities at work between 2007 and 2014,
20 of which happened within the construction industry (NSO
071/2015).
Moreover, the local construction sector claims the second
highest rate of occupational accidents each year. In 2017,
15.2% and 16.9% of non-fatal accidents were recorded in the
construction and manufacturing industries respectively (NSO,
2018). There is a code of practice and various pieces of OHS
legislation target the construction sector specifically. This
implies that construction employers have the obligation to treat
workers fairly, to provide workers with a healthy and safe work
environment and working conditions that do not harm the
workers’ general physical or psychological wellbeing (LN18 of
2018). The increasing engagement of foreign workers presents
significant challenges for OHS management. One immediate
challenge is to communicate OHS information in ways which
can be understood and acted upon. Many foreign workers barely
speak or understand the English language, let alone the Maltese
language. This presents a problem when addressing tool-box
talks on local construction sites.
In many developed countries, there has been a shift from
permanent full time employment to temporary part-time,
sub-contracting labour and self-employment. Fabiano (2008)
conclude from Italian OHS data that such work practices may
be conducive to workplace accidents due to high workload and
work pressure. In the absence of trade union representation,
organizational complexity and ambiguous OHS responsibility
within the different tiers of subcontracted works, employees
become exposed to higher levels of OHS risk as they are pushed
to work excessive hours and to ‘cut corners’. Workers’ health,
safety and wellbeing are critical to the construction industry’s
sustainability and long term economic performance. Investment
in OHS is often perceived as a natural cost incentive for
construction firms, because the aggregate costs of work death,
injury and illness are substantial. The local construction sector
has made notable improvements in employee health and safety
management as well as in undertaking risk assessments at the
workplace, especially on large construction projects.
Managing Diversity
As foreign and migrant workers increase on local construction

sites, the industry has to be wary of diversity ‘best practice’
strategies and learn to reinforce culture differences on sites.
This implies bringing together people with different cultural
backgrounds, different age groups, race, colour, religion, language
and gender or sexual orientation. The effective management
of this diverse workforce has important implications for the
productivity, safety, health and welfare of construction workers
and for the performance and reputation of the firms that employ
them. The employment of foreign workers can lead to cultural
dissonance, communication problems and disputes on site.
People do not respond to intentions but to perceived behaviour.
Regardless of each individual’s values and convictions, co-
workers need to treat each other with respect, compassion and
integrity.
It is critical for construction managers to be cross-culturally
competent, empowered with the required knowledge for
improving the efficiency of managing culturally diverse teams.

Studies suggest that construction supervisors and foremen
are less effective when managing a work group composed of
several nationalities (Dainty et al., 2007; Loosemore & Lee 2003;
Loosemore et al., 2010). Language is regarded as a major obstacle
to effective communication among the workers of different
nationalities. Trust provides the invisible glue that can hold a
dislocated team together. As trust increases, team members
become more open and honest with each other.
Case Study
A project manager working on a large local construction site has

shared experiences in managing cultural diversity. The company
he works for does not have any written ‘diversity management
policies’ in place; but foreigners have been employed with the
company for the last fifteen years. One may argue that the
existing legislation and the laborious paperwork to get work
permits makes it difficult for them to move from one company to
the other. Whilst admitting that there is room for improvement,
the company practices the following: (1) it values each individual,
while acknowledging the differences between the workgroups;
(2) it has a performance evaluation system in place whereby each
employee is given the chance to identify any areas of interest for
further training; and (3) it measures diversity performance by
monitoring levels of satisfaction among employees, workplace
conflicts and disputes, and retention for every cultural group,
including the Maltese.
The Company implements diversity management through:
1. Training: Education is for all and not just one group.

It makes use of pictorial signage as much as possible
for health and safety procedures and risk assessments.
It organises tool box talks on site to teach them site
vocabulary in Maltese for the tools, materials and work
methods used. Knowing what to say could spell the

difference between life and death.
2. Family values: Family values are common to all,

irrespective of any culture. Knowing that foreign
workers may be away from their families, the company
tries to support them in all their needs; making sure that
they have an adequate place to live; helping them settle
down in Malta; and providing transport to and from
work. In this way, workers will feel more secure and have
a stronger sense of belonging and commitment.
3. Cultural integration: Every now and then, the company

holds a party or a lunch on different construction sites.
Work stops early and a social gathering is organised on
site. A suckling pig is cooked for the Serbians, chicken
and vegetables for the Indians and couscous and lamb
for the Muslims. The company organises a Christmas
lunch, barbeques and other different social gatherings
outside working hours for all so that people from
different cultures can mix and mingle.
4. Cultural holidays: Different cultural and ethnic groups

celebrate events and holidays that have specific cultural
value and significance to them. The Orthodox celebrate
Christmas on January 7th whilst the Indians celebrate
their Diwali day from Mid-October to Mid-November.
The Muslims celebrate their Ramadan in July and
August. Their day of prayer is Friday. Maltese national
holidays may not be significant to these foreign workers,
so the company trades off such holidays with theirs.
The company still pays them overtime for the national
holidays during which they work.
5. Personal holidays: Indians visit their families once a

year, usually in February, Serbs and eastern Europeans
visit their families twice a year. The company maintains

a summer holiday shutdown around August 15th and
another one during the Christmas holiday period. These
may not be of much significance to foreign workers. The
company is flexible and lets them work during these
shutdowns.
6. Role modelling: The company believes that positive role

modelling of successful and inspirational employees
from minority groups can have a significant motivational
impact. The company seeks to promote people from the
work group to lead them. This has enhanced project
performance. An Indian leads the Indian steel fixing
team whilst a Serb leads the Serbian shutter worker
team. Each group has a health and safety representative
as role model on site.
7. Cultural matching: In-house employees are matched to

project participants with similar backgrounds, cultures,
and native languages in order to reduce cross cultural
communication and in order to be more efficient in
achieving organisational goals.
8. Equal opportunity: Unfairly treated employees are less

likely to perform to their full potential. Recruitment
policies make sure that all legal observations are adhered
to and that there is no discrimination with respect to
colour, race, gender or sexual orientation. It tries to fight
and eliminate stereotyping, tokenism and ethnocentrism
whilst encourage inclusiveness.
The above example is relevant, and is becoming more

so, with the ever increasing number of foreign workers that
are being engaged in the local construction sector. In spite of
geographic origin, colour, size, gender and culture, a worker
is a human employed to perform a task, to make the business
happen. Emotional intelligence is becoming the order of the day.

Feelings render no distinctions between workers whether being
black, white, yellow, and a happy worker remains a happy worker
whether coming from Serbia, Italy, or India. Contractors have to
strive to deliver better buildings through content construction
workers by providing the best construction site facilities, top
working conditions and most of all reasonable wages.
Conclusion
An engine works efficiently with the least amount of friction.

Should this fundamental idea be transferred on human resource
management in the local construction industry, it would involve a
high degree of effective communication techniques, smoothness
of handover, teamwork issue resolution, joint decision making,
people selection and people prioritisation. This analogy is highly
relevant in the current local construction sector composed of a
highly diverse workforce.
The most urgent business challenge currently facing the
industry is not the implementation of innovative technologies
but looking after people. Companies who fail to improve
their attitude and performance towards respecting their own
people and others will fail to recruit and retain the best talent
and business partners. The sector has to build a cooperative
workplace culture where different cultural groups can work
in harmony. Contractors have to value each employee while
creating collectivism and worker camaraderie. The challenge is
to learn and appreciate one’s own values and perspectives and
while eliminating discrimination is certainly not an easy task,
the challenge is to find a balance and appreciate the skilled
work, finding the time to praise each and every one when the
need arises. They have to balance the right to be equal with the
right to be different. This definitely makes life easier to all on
site. Contractors require the ability to demonstrate respect,
communicate effectively, and encourage people to work
collaboratively with different cultural backgrounds. They need

to value and use the resources of their diverse staff to develop
and complete any project on time, to budget and to achieve the
right quality. Construction project managers have to identify any
differences and view these as a resource rather than a problem.
They cannot pretend that the diverse employees should fit into the
organisation but the other way round. Innovation and new ways
of thinking are valued. The construction firm should facilitate
diversity: each individual should be cared for irrespective of
his/her diversity in order to create a healthy work environment
where people’s potential is acknowledged and supported. The
industry has to learn how to engage effectively with different
types of people. This requires positive values, setting high ethical
standards and going beyond one’s own personal interests while
pursuing the wellbeing of construction workers. To ensure
improved and overall performance, it is important to involve,
engage and empower all workers irrespective of their diversity
in issues that directly affect them. This is done by continuously
investing in their training and development, in their health
and safety, provide decent site conditions and (most of all) fair
wages. It is this package that provides the lubricant required by
construction, this engine of development in Malta.
References
Bosch, G. (2003). Building chaos: An international comparison of deregulation in the

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Manufacturing: Factory
Work and Automation
David Parnis
Automation reigns triumphant in Maltese manufacturing.

Today, a series of automated robotic hands are capable of
quickly interacting with each other, easily grasping injection
moulded parts, using a number of cameras to assess shape,
dimensions and a number of important quality parameters and
then triggering a set of movements, whilst assisting production
process assistants with collaboration activities. And all in a
matter of a few seconds, managed by software control systems.
This form of intelligent technology is powerful and influential in
many aspects of Maltese manufacturing industry. Automations
have changed the ways that work is done in organizations,
abolished exhausting physical labour and wearisome repetitive
tasks, helping people to do things better and faster. Technology
has blurred boundaries, as the physical and invisible electronic
spaces have merged. Location, time, borders and geographical
distances are no longer as critical as they once were (Cascio &
Montealegre, 2016). Indeed automation shapes lives and has the
ability to change life itself. This form of dynamic development
is embedded in a quest for technological innovation wherein
automation has become a cultural phenomenon permeating
the Maltese factory floor, ‘hurtling us toward a new industrial

revolution’ (Murray, 2015, p. 6)
This situation brings with it an obligation to reflect on
the concept of work, and rethink the impact of emerging
technologies on local business models and the Maltese
workforce. History reminds us of how technology has affected
employment and the extent to which it has created and taken
jobs away. Mechatronics experts, looking mainly in the direction
of high-speed manufacturing, are again changing the Maltese
workforce. This chapter reflects upon the nature and purpose of
automation, and its implications on the world of factory work in
Malta. It reviews how the interests of employees are being served
and how the priorities of engineers, the thrust of their work, and
the ways in which employers organise all-around automation are
shaping factory work in Malta.
Transitions
Maltese manufacturing has not been a major economic activity

for most of the island’s history. Other than spurts of shipbuilding
in the dry-docks and shipbuilding yards situated in the majestic
Grand Harbour, Malta has not been much involved in building
and manufacturing material objects. By the middle of the
twentieth century, the only notable manufacturing concern was
a single brewery. That changed with the 1958 decision of the
British colonial administration to pull out of Malta. No longer
valued as a ‘fortress colony’ (Pirotta, 1987), the country laid out
its first ever development plan in 1959 and sought to attract
foreign investment by a variety of fiscal incentives, and opening
its first industrial estate, in Marsa in 1961 (Vella, 1994). The
first wave of factories to open were labour intensive operations,
producing textiles and garments; they were instrumental in
bringing-in Maltese women into the workforce (Grech, 1978).
Peak employment was reached in 1980, after which Malta’s
appeal as a competitive, cheap labour location was progressively
Manufacturing: Factory Work and Automation 271
eroded (Baldacchino, 1988). Most firms closed down or relocated

overseas; those that remained, have had to replace labour with
capital to remain in business. Despite the relative decline,
manufacturing remains an important sector for the Maltese
economy. Over the years the manufacturing sector has been
gradually transformed from a low cost sector into one producing
higher value added products. Today the sector contributes over
13% to Malta’s GVA, making it one of the main pillars of the
Maltese economy and one of the largest recipients of foreign
direct investment (FDI) flows (Central Bank of Malta, 2018).
Within Maltese manufacturing, automation and artificial
intelligence are rapidly taking over the world of mass production.
During recent decades, the manufacturing sector in Malta has
registered huge progress with automation, autonomous systems,
artificial intelligence and robotics taking over the factory shop-
floor. The development has spanned from automating routine
work and adding mechanisation to what employees did, to a new
paradigm wherein automations can do totally different things.
Machines nowadays are able to do repetitive work much better
than human beings, and with the added programmed ability to
discover novel solutions to manufacturing problems which make
the actual manufacture of different products less challenging. A
span of three decades has witnessed extraordinary developments
wherein automation has progressed to a state where it can
correct its own mistakes (Ang & Feinholz, 2018). With sensor
systems, image recognition, and navigation algorithms, factory
work and the manufacturing process have been engulfed by the
amount of computer power put into these automations and the
mining of data that has been made available (Qiang Yang, 2018).
Technologies, just-in-time manufacturing, data-tracking and
robots are at the forefront of the shop-floor today. In the future,
some factory employees will be replaced with technologies in
a linear and deterministic manner. Automation, robotics and
machine learning have improved productivity and are now spilling
over onto other industries, including finance, transportation and
energy management. Automations, connected to the ‘Internet of
Things’, facilitated by high-speed networks and remote sensors

to connect people within the manufacturing businesses, are
increasingly a reality (UNESCO, 2017). Automations have made
all kinds of performance improvements, reduction of error rates
and predictions a reality. These benefits span to the general
Maltese economy and to people as users of such technologies.
Automation has improved all aspects of productivity, with
production assistants enjoying the comfort of using technology,
whether that comes through voice recognition software or in
other techniques that are useful, to all of us, as users. Those
benefits are clear: to users, the economy and business.
This has an impact on work with some concerns and
possible anxieties for Maltese factory employees. The impact is
deterministic. Any work activity that involves data collection of
one sort or another, activities that involve data processing of one
sort or another, and activities that involve doing physical work
in highly structured and predictable environments will be taken
over by intelligent machines. Much will be mechanised; with
major social transitions occurring. Occupations that involve a
lot of data gathering, data processing or physical work are going
to decline further in the coming years. Those occupations and
activities that are relatively harder to automate, such as work
that requires judgment and discretion, will rise, and so the
occupational mix will shift substantially. That means that some
skills will be rendered obsolete while new skills may be required
to work with the improved technology (DeCanio, 2016) and
workers are probably going to have to move and be transitioned
from current jobs into new, growing occupations.
Automation will continue to change the factory shop-floor,
and as such employees have to develop connections with
one another and foster a sense of team-work. Interpersonal
competencies have become increasingly complex, wherein
employees in Maltese factories have to learn to use advanced
technology to enhance their performance. So, whilst utilising
human resources more effectively, this same automation is
able to predict production mistakes, and identify differences
in employee productivity. Automation is powerful and its

production speeds surpass human constraints, providing a host
of advantages, but also challenges to employees as there will
be changes in the required skills and competencies (UNESCO,
2017).
Skills requirements have shifted and are set to change
even more. Maltese employees will be forced to consider new
occupations that require higher skill sets. Skills requirements
are going to rise, if only because people are going to be working
alongside highly capable and increasingly capable automations.
In order for factory employees to keep up, adapt and work
effectively alongside highly capable machines, they will require a
very different set of skills; so the skill transitions will have to be
substantial. Workers will need more than practical operational
skills and need to develop understanding of how these
technologies have been programmed, how they are making
calculations, and how they are making decisions (UNESCO,
2017). This involves a process of constant retraining and re-
skilling, especially for middle-aged career factory workers, who
may have grown up in one environment with a certain set of
skills and will, inevitably, have to move into new occupations.
Or, even if they are in the same occupation, that occupation will
require a higher level of skills in order to be valued and continue
to be effective.
Along with the transition in skills, an impact on the wage
structures of Maltese factories is also being witnessed. The
National Statistics Office (Malta) attests that work in the
manufacturing sector has always had slightly higher wages
compared for example, with work in activities like care work.
Engineers earn more than teachers, and so forth (NSO, 2018).
This change is also having an impact on the labour market.
Another consequence of this change in Maltese manufacturing
is the impact on Maltese educational institutions and their
research agenda. Within Maltese manufacturing, there is a
dearth of pure research, motivated exclusively by the search for
knowledge for its own sake. Most research, if not all, is utilitarian
and seems to be exclusively profit-driven. This phenomenon has

had an impact on the agenda and funding of academic institutions.
The commodification of technological development has thus
dominated the area of applied manufacturing technology. In recent
years, the manufacturing industry in Malta has increasingly been
investing in and collaborating with the academic world, notably
the Faculties of Science, Engineering and ICT at the University
of Malta and Malta College of Arts, Science and Technology
(MCAST). The goal is not to advance the frontiers of knowledge;
this comes as secondary. The objective is to create more wealth.
In this sense profit-motivated technological developments and
new waves of automation have provided new technological tools,
and at times led to ancillary research breakthroughs. Of course,
this is not to mean that the largest companies in Malta can be
technologically self-sufficient. Even the best and well-financed
engineering research units can only command and control a small
segment of this huge market of technical ideas and applications.
The challenge is that the profit motive may lead to short-term
profit-based goals and, consequently, horizons, and thus locks the
world of Maltese manufacturing, academics, researchers and large
companies in a deadlock as advances in technology are merely
made to generate profit.
A further transition will also occur in the sense of virtual
assistance. On the Maltese shop-floor, automation facilitates
and accelerates production work. Modern applications utilise
the latest in programming and robotics, analysing production
parameters, in collaboration with automation operators who
cannot process at such great speed and accuracy at record
times. Systems are capable of rapidly and accurately locating
manufacturing errors, many times faster than any human-
being. Programmable automations and systems can yield
outstanding results. In just a few minutes, automation is able to
do work that workers would take hours to finalise, and with even
better results and consistency. In this way, automation assists
employees; the software of which is constantly analysing the
quality of the manufactured parts, their production parameters
and many other manufacturing limits. If employees perform

a production manoeuvre and if the automation estimates this
manoeuvre will cause poor production, the automation will
correct the production manoeuvre; and the same system will
tell the employee to correct the process. The automation is
able to predict the exact time at which a damaged production
part will fail entirely, so that the employee can decide whether
to continue the production process or stop it altogether. This
makes it possible to perform an increasing variety of tasks with
a high level of technical skills, and contributes to a number of
benefits that include lower costs, higher quality, improved safety,
and environmental protection (Cascio & Montealegre, 2016).
All the transitions mentioned involve the active development
of next generation automations and concepts; their use in future
manufacturing activities will bring many opportunities to the
Maltese but also challenging transitions that are complicated to
predict. Yet one thing is sure; whoever dominates the automation
world will win in the game of capitalism. The positive aspect to this
is that no one has a monopoly on the manufacturing automated
world; rather, technologies are shared (Gratton, 2011).
What are the theoretical implications of this revolutionary
transition into the world of work? There is no consensus in the
field, but Merton (1975) has called for a strategy of disciplined
eclecticism. Eclecticism, in essence, involves the attempt to
consider a number of tendencies that provide promising lines of
inquiry, thus making the selection more eclectic. Nevertheless,
an attempt is then made to do the task in a directed and
disciplined manner. Hence, in essence, the vain attempt to let
a hundred flowers bloom side by side is eschewed and instead,
some flowers are cultivated at the expense of others. As Coser
and Rosenberg (1989) argue, this way of approaching a subject
may well leave out important aspects, but selections inevitably
have to be made. In any case, the resulting insights should prove
useful to a better understanding of the world of automations in
Maltese manufacturing. The writer now turns to explain these
aspects.
The Application of Theory
The world of Maltese factory work is dynamic and ever-changing

and is bringing about a constant process of blurring and breaking
down of barriers which separate ‘work’ from ‘life’ (Beck, 2008).
For many Maltese employees, involvement at work has become
portable; it extends beyond shift hours and workplaces. In this
manufacturing paradigm, work goes on to haze the boundaries
between ‘work’ and ‘non-working’ time. Intelligent automation
is a resource which shapes choices employees make, contours
the lives employees lead and this leads to a profound influence
on the employees’ life context. This manufacturing paradigm
is, in a number of ways, shaping Malta and the lives of Maltese
employees. A new socio-cultural framework is being shaped
by the Maltese manufacturing organisations in which these
employees work, be they small entrepreneurial ventures or
global multi-national firms (Sinek, 2014). Maltese organisations
are continuously determining the jobs that are being created,
as well as incessantly influencing other broader practices
which shape how employees are selected, promoted, rewarded
and developed. This will have a ‘corresponding effect’ on the
generations of Maltese yet to come (Gratton, 2011).
Technology can be used to enable or to oppress people at
work (Coovert & Thompson 2014). If technology is to enable
people at work, it should foster self-motivation and well-being,
key elements of self-determination theory; enhance productivity;
and promote job satisfaction, organizational commitment, and
citizenship behaviours among workers. Feelings of oppression
occur when technology leads to a lack of autonomy, competence,
and relatedness. In turn, these lead to stress, demotivation, and
counterproductive work behaviours. Indeed, this oppression
of people at work is being felt so much that in France, a new
employee right, the ‘right to disconnect’ has been recognised
in favour of employees. The widely-debated Loi Travail which
entered into force on January 1st 2017, has introduced the
droit a’ la deconnexion, which obliges French employers to
introduce times when their employees should not send or

receive emails (Minister du Travail, 2016). Other jurisdictions,
notably Canada, have followed suit (O’Dell, 2018). This right is a
direct acknowledgement by the legislator that the haze between
working time and non-working time needs to be removed and
clear demarcation lines and barriers be re-introduced.
Indeed, the notion of breaking down the barrier that separates
work from life, and the way work shapes peoples’ lives, is a
notion that Karl Marx expounded very well. As applied to the
factory world of ‘back-then’ and of today, Marx did observe that
the division of labour that accompanied the industrial revolution
divided the interest of the worker from the interest of the
community, and made the worker a passive consumer. This was
not, for Marx, what work should be about. At the centre of the
Marxist thesis is the idea that work should be meaningful and
serve as a process of active self-realisation, rather than passive
production and consumption. Drawing on the labour theory of
value, Marx asserted that value is created when men and women
exert their labour on an object, defining work as an inherently
creative endeavour. For Marx, humans derive meaning from their
observed creativity, from interacting with their surroundings in
ways that produce tangible improvements and generate value.
This is anathema to the world of Maltese manufacturing. Factory
work, through automation and robotics is indeed fragmented;
the productive efforts of workers are focused on a single detail
of a bigger picture. In the production setting, the link between
production and manufactured product, and between creator
and the creation, start to fray (Giddens, 1991). In today’s Maltese
manufacturing world, it is difficult to look at work as a process of
self-realisation. Automation now dominates the manufacturing
world, alienating its human subjects, instead giving rise to
a concept of value that Maltese employees only experience
indirectly, through monetary remuneration. Increasingly,
therefore, people define their own value and the value of their
work, not by how much they produce, but by how much they get
paid for it. The connection between work and value that makes
productive lives meaningful is no longer visible on the Maltese

production shop-floor. In a Marxist sense, it is the interactions
in the working world, during the working hours, that define who
people are, who they become, and whom they are redefined
into. What is apparent in the Maltese manufacturing world is
that, in a Marxist sense, the workplace is distinct from the realm
of enjoyment and meaning, and thus, part of the very nature
of human beings is becoming diluted through the mechanical
repetition that automations dictate; and in so doing, people lose
the sense of authenticity, and become alienated (Giddens, 1991).
The other risk to this is that automation, by its very nature
of breaking down the production process into repeatable tasks,
de-skills and makes Maltese employees become too narrow; as
well as, at times, too rigid. This goes contrary to the need of the
manufacturing world, wherein employee value comes from the
ability to be able to combine different areas of depth and fuse
all together, whilst being able to adapt to the dynamic needs of
factories. In this sense, Maltese employees are constantly needing
to develop knowledge, insights and skills as well as rediscover
competencies. This trend will have a huge impact on the 6,000 or
so Maltese children who, on a yearly basis, begin their scholastic
journey. Those children starting school now will spend most of
their working lives in the second half of the twenty-first century.
The pace of change brought about by advancing technologies
makes it increasingly likely that these children will work in a
manufacturing world that is very different and more advanced.
This world will demand further skills from these students. Apart
from reading, writing and arithmetic, traditionally known as the
3-Rs, the basis of any skill set at any workplace, students will be
forced to acquire further core abilities, including their ability to
believe in themselves in order to ensure their employability. This
self-efficacy and self-reliability not to mention also flexibility
is critical in a technological world wherein the pace of change
will get faster and the breadth and depth of automation and
technological forces will push workers to adapt, be flexible
and nurture resilience to the system. Maltese students need to
develop critical thinking, as automation further dominates their

working world. Skills will be learnt on the job, acquired whilst
working together as a team, when interacting with the machine,
when planning and setting goals, the seeds of which would have
been planted years before in primary schools.
These developments suggest a different perspective from
the one advocated by Rifkin (1995). He affirms the far-reaching
transformation of the world of work wherein he postulated the
idea that we had reached the end of the road, and automation
would drastically reduce the number of jobs. This is not the
case in Malta, at least so far. The passage of time has shown
that technological innovation has created jobs on a large
scale in Maltese factories. What is evident is that automation
brings with it new jobs which can more than make up for the
inevitable loss of manual jobs in Malta. Surely, there is a process
of dematerialisation – the shift away from material products
– which is revolutionising all aspects of work, its nature, its
organization and its relationship with other activities. To
this end, automation in Maltese factories is not just about the
manufacturing of physical objects, but also the handling of data,
images and symbols. The content of jobs related to automations
is becoming more abstract.
Maltese factories seek skilled workers who are more in
demand: the number of technicians and engineers needed is huge.
The organisation of these workers, as well as the product of their
labour, has also become intangible. The nexus of time, space and
action which characterise the manufacturing world is slowly being
altered (Gorz, 2005). The work of these Maltese professionals is no
longer a regular eight-hours-a-day, five-days-a week routine. New
rhythms have appeared thanks to the hectic pace of automation
which never sleeps, the ups-and-downs of technical faults, the
demands of lean manufacturing, just-in-time production where
components are delivered a few moments before the final product
is assembled (Reid & Sanders, 2010).
Factory work in Malta is being subjected to new working
methodologies and on-line connectivity which, again, means
that the employee never “sleeps”. This change of work-time and

workspace is going hand in hand with a functional explosion,
wherein the range of skills and the types of work are expanding
steadily. Automations through information technology are
strengthening the links between different stages of work and
creating an overall fluidity. This fluidity and new form of work is
non-linear. When handling information, knowledge and feelings,
there is no direct relationship between the amount of effort and the
final result. This makes for very wide disparities in productivity.
In the Maltese production world, the ratio of the performance of
an average worker to that of a good one can be seen through the
production rates and manufacturing quotas, or what is known
as ‘overall equipment effectiveness’. And yet, in immaterial,
service work, an excellent programmer can be tens of times more
productive than an average one, without anyone knowing (Reid
& Sanders, 2010). This non-linearity in the type of work and jobs
brings about non-linear Maltese organisations and work models.
Automation and these new jobs have made the notion of a rigid,
formal hierarchy based on unchanging criteria redundant. What
matters is technical, scientific skill. Functional hierarchy within the
Maltese shop floor has been replaced by brain-power. Authority
in this sense gravitates to those who create and add value to these
intangible assets; those who have mastered the technological
know-how. Automation has thus individualised the assessment of
performance. Two electronics engineers doing the same job may
have different salaries and different status. This effects across-the-
board pay rises which are being dropped and replaced by bonuses
linked to results. Maltese trade unions and their membership
are being impacted. There are no privileged positions in the
new business enterprise: for rank-and-file employees, machine
operators, supervisors or technicians. Business leaders are no
longer a protected species and real life situations show that the
heads of large Maltese manufacturing firms are increasingly being
dismissed for poor performance.
Notions of loyalty and indissoluble links between a Maltese
company and its employees are losing their meaning. The
changing nature of work has led to a big increase in so-called

non-typical jobs. The growth of non-typical jobs is the result
of the convergence of several persistent developments and a
number of transitions. In the Maltese labour market, automation
has increased the competitive pressures to adapt to a global
economy. Maltese factories have had to figure out how they can
use their workers more efficiently, flexibly and, ultimately, more
cheaply. Automation demands new services. Its maintenance
requires a wide range of goods and services at the drop of a
hat. Automation never sleeps, and so do its preventive and
maintenance services. Further transitions that have been brought
about include the widening range of types of work, long-term
demographic trends, and greater numbers of women workers,
all of which are supported by longer life expectancy. This means
that the divide between traditional kinds of work and the new
jobs is no longer watertight. People are increasingly switching
back and forth between the two categories of work (Beck, 2008).
Automation in the Maltese shop-floor has also meant that the
rigid frontiers which marked off the world of work, education
and leisure from each other are now further interwoven into a
new form of ‘Taylorism’ of the labour force, where all knowledge
is in the hands of technical people, managers and the decision-
makers; while the rest of the workers do not have to think or
know much (Harvard Business Review, 2011). In this sense,
traditional styles of management may continue. Automation
has thus brought about a new technical division of labour. On
the one hand, are those with access to knowledge and ability to
control automation; and on the other are the excluded, those
who will be even more subordinate in the workplace and will be
divided up and partitioned off, even in work which seems highly-
skilled (Knapp, 2016).
And yet, any organisation’s long-term interest is to improve
the quality of its workforce. That rests within the hands of
those in control. Automation thus puts managers in the
Maltese factory in a difficult situation, obliged to solve two
seemingly contradictory problems: producing more innovative
products based on the latest advancements in automation; but

also drastically cutting costs and reducing the time it takes to
get these products to market. The first task requires access to
the best automation and programming, and the capability to
innovate. The second requires focus on the disciplined use of
resources. These requirements may, at times, pull in opposing
directions (Gorz, 2005).
Having elaborated on these aspects, a number of implications
of technological change for Maltese factories are now considered.
Implications for Factories in Malta
In the long run, Maltese factories will weather the technological

challenge. Advances in automation will assist Maltese factories
in saving money, helping them lower their prices and hence
increasing overseas demand for Maltese-manufactured quality
products. This will mean that Maltese factories are likely to keep
their full complement of workers. Given the fact that the factory
world is kept at vigil by Maltese trade unions, especially the
General Workers’ Union and the Unjon Ħaddiema Magħqudin,
these benefits should also filter to employees. The largest
manufacturing companies in Malta offer ample examples of this
phenomenon. Over the last years, their shop-floor automation
has increased drastically. This has been reflected in employment
numbers, together with an exponential demand for technical
expertise. Some sixty manufacturing firms have ongoing
collective agreements in place, signed by their management with
either the GWU or the UHM (Baldacchino & Gatt, 2009). Shop-
floor automation has created jobs in supervisory positions,
system repair and maintenance, as well as jobs for those reshaping
shop-floor space and infrastructure to come to better terms with
the accommodation of intelligent machines.
What is also clear is that, in Maltese factories, automation
has so far replaced parts of jobs, at times, huge portions of jobs,
rather than entire ones. In the largest Maltese factories, which
employ hundreds of workers, where automations track overall

equipment effectiveness, process assistants have not been fired.
Rather, they have moved to work on other parts of their job. When
Maltese employees are not performing routine tasks, they are
probably being detailed to do something better. As an example,
material handlers are now packing more boxes to be shipped
because they are assisted by automations which do the running
between the shelves. Plant maintenance technicians use drones
to survey the roofs in Industrial Estates and are more effective.
In Maltese factories, we have witnessed almost zero job loss in
employment aggregate numbers in recent years. A convergence
of deep learning and big data is helping the mastery of complex
manufacturing processes on the Maltese shop floor; and, with
automation and artificial intelligence being continuously
improved, the design to manufacture and production cycle of
Maltese manufactured products is becoming faster. This trend is
now penetrating all industries, not just manufacturing factories.
With this happening, automation and advances in technology
are set to become the most influential factors shaping Maltese
factories, and Maltese workplaces generally, in the years to come.
Automation is creating new and better jobs within the
Maltese manufacturing industry. It has boosted productivity and
improved efficiency, whilst changing employment demographics.
In this scenario, it is likely that less qualified workers will bear
the brunt of adjustment costs; the ‘automatibility’ of their jobs is
higher compared to other, better qualified workers. Technological
progress is set to leave behind those with ‘ordinary’ skills, as
automated robots and other digital technologies take over their
skills and abilities. Yet, new jobs will be created. Of course, there
will be fewer people sorting items in a warehouse; robots will
do that, much better than humans. But mining of big data sets,
and managing data-sharing networks will become even more
critical. Over the long run, as has been the case during past
periods of economic conversions, work in Maltese factories will
be transformed; but human employees will still be needed for
many tasks. This goes hand in hand with the fact that in Malta
the birth-rate has drastically declined, and thus we can project

that the working-age population will shrink in the years to come,
unless compensated by immigration. To maintain even today’s
Gross Domestic Product, Maltese workers will each need to
become more productive, and as such the Maltese factory
workforce will need to engage in continuous improvement. In
this situation, automation is one answer. As Maltese factories
embrace the ‘fourth-industrial-revolution’, there will be labour
displacement, but many gains as well.
Conclusion
Within the Maltese manufacturing industry, work is changing at

a faster rate, especially with the advent of intelligent automation.
Work is becoming simultaneously more short-lived and more
pervasive, more dissociated and more integrated (Beck, 2008).
Fragmentation of time patterns is more extensive; yet, intelligent
automation is strengthening the links between different stages of
manufacturing processes. What Maltese industrial history has
taught us is that waves of automation have both destroyed jobs
but created higher-value ones. The Maltese have then rotated
around such jobs, with the ability to learn, unlearn and relearn.
This has been key to individual and to Maltese manufacturing
success. Future generations of Maltese are likely to inherit more
opportunities to transform the shop-floor, and this is cause for
optimism.
The application of automation and technology to Maltese
factories has had an impact on Maltese factories, the Maltese
economy, and Maltese society. It has a bearing on this country
whose power as a nation depends on its economic performance;
and therefore, in manufacturing factory sense, its capacity to
produce more and better by innovating and automating. All
stakeholders, including the Maltese Government and educational
institutions, are called upon to defend and strengthen this
capacity. For years to come, the strength and sustainability of
Maltese factories will be gauged by their ability to turn out

new products and services more quickly and more cheaply:
innovation and technology will continue to show how this is to
be done.
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Tourism and Hospitality:
Come Visit oUr Islands
Leslie Vella
For most of its recorded history, Malta was primarily prized for its
strategic military value. This was a combination of geographical
location, in the centre of the narrow straits that link the western
and eastern basins of the Mediterranean, and the excellent deep
water harbours which could provide shelter all the year round to
huge fleets. This combination placed Malta as a key possession
to all the powers that held sway over the Mediterranean since
classical times, from the Phoenicians to the Carthaginians and
Romans, Byzantines, Arabs, Normans, Angevins, Aragonese, the
Order of the Knights of St John of Jerusalem, Napoleon’s French
and finally the British, who ruled over the Maltese islands until
independence in September 1964.
Throughout these two and a half millennia, Malta’s economic
fortunes fluctuated with the rise and fall of its masters. Its
economic situation is best summarised as one which boomed
during times of conflict and slumped during times of peace
(Busuttil, 1965).
The Knights of St John were arguably the first modern power
who presided over the need for a diversified Maltese economy
based over the necessity to sustain a growing population, estimated
at around 17,000 in a 1524 report commissioned by the Knights

prior to the start of their rule in Malta in 1530 (Brockman, 1961, pp.
205-6; Luttrell, 1968); and peaked at around 114,000 by the time
of their departure in 1798. Such huge population increases obliged
the island to create economic wealth based on construction and
maintenance of an immense defence infrastructure, agriculture
and trade. The emphasis during this and subsequent periods was
on military expenditure to provide employment and sustenance to
the population (e.g. Luke, 1960).
The British established Malta as a fortress colony: a
fundamental harbour and coal depot for their military and
merchant shipping plying the route to India via the Suez Canal
(Pirotta, 1987, 2001, 2016). It was also an important base for
their Mediterranean fleet, lying midway between their other
important footholds in Gibraltar and Egypt. This importance
culminated during the Second World War when Malta played a
very important role in weakening Axis General Rommel’s supply
lines between Italy and North Africa eventually leading to an
Allied victory in North Africa and the subsequent invasion of
Sicily which was partially executed through Maltese airfields.
The post-war period of peace in Europe and the 1956 Suez
Crisis ushered in an era of economic uncertainty on the island,
triggered by the United Kingdom’s expressed objective of cutting
down on its global reach and recurrent military expenditure,
including in Malta. This in turn led to the first real attempts to
diversify the Maltese economy by weaning it off its long-term
dependence on serving the military establishment, and including
Malta’s first ever development plan, for 1959-1964 (Baldacchino,
1988, 1998). It was as a result of this situation that Lord Robens,
in his Report of the Joint Mission for Malta identified tourism,
together with light manufacturing, ship building and ship repair,
as a sector with the potential to provide alternative economic
opportunities for Malta and its labour force, at a time when
migration to the UK, Australia, Canada and the United States
was seen as one of the only short-term solutions aimed at
addressing chronic unemployment on the island (Robens, 1967).
Tourism Employment in Malta 289
Diversification
Thus, the modern Maltese tourism industry was born in the late
1950s, at a time when its development bore all the hallmarks
of a destination struggling to come to terms with its own
identity. Malta’s initial ventures into tourism were based on the
assumption that the United Kingdom was the island’s obvious
and natural source market and that what British tourists were
seeking was merely a Mediterranean version of their homeland.
The link with Britain was also evident in the way that tourism
was also viewed as a natural and logical transition point between
the service needs of the British military establishment resident
in and visiting Malta and the alternative, but seemingly similar,
service needs of incoming tourists, mostly British.
A huge quantity of Maltese workers who derived a living from
the British military presence were people who, rather than being
directly engaged in the army, naval and air force services in a
military capacity, provided ancillary services in areas such as
catering, transport, maintenance and housekeeping: these were
considered as relatively straightforward to transition from the
military sphere to the new-born tourism industry.
Indeed, most of the initial workforce in the first few decades
of the Maltese tourism industry consisted of ex-British services
employees. This is also borne out in certain idiosyncratic
characteristics of the original Maltese tourism offer, with the
most obvious examples coming from the “Maltese cuisine”
dished out by Maltese catering establishments until as recently
as the mid-1990s. This period of Malta’s culinary offer for tourists
is characterised by the oft-derided “chips with everything”
mentality coupled with non-traditional-Maltese offers such as
roast beef, deep fried North Atlantic fish in batter, pies, mashed
potatoes, baked beans and overcooked pasta: Malta’s first
restaurateurs were people who had learned their trade serving
in the catering corps of the British services and thus assumed
that what they used to cook and serve for their former British
military employers was what tourists expected.
This narrow initial appreciation of the country’s tourism potential

was to have a profound effect on two aspects of Malta’s tourism
performance, which continue to constitute challenges even today.
The first negative effect relates to geographical diversification
whereby a traditionally strong dependence on the British market
precluded Malta from attracting tourists from other countries
with the obvious risk of endangering the entire industry when
tourism from the United Kingdom declined. This situation
started to be reversed in the mid-1980s when conscious efforts
were made to increase visitor numbers from other countries at a
stronger rate of growth: a process of ongoing diversification, as
Malta broadens the number of countries from which it sources
tourists from across the globe.
The second negative effect, with direct links to the first, relates
to the issue of seasonality. The positioning of Malta as a sun
and sea destination between the late 1950s and the mid-1980s
resulted in a huge concentration of tourism inflows around the
peak summer months with very little off-peak activity during the
rest of the year.
A snapshot of the early effects of seasonality and high
dependence on the British market on Malta’s tourism sector, as
how these effects have been somewhat mitigated over time, can
be seen in Table 1.
Table 1: Characteristics of Tourist Visitations to Malta: 1967-2017
1967 2017
Total Number of Tourists 97,519 2,273,837
Number of British Tourists 74,054 560,893
Total number of tourists visiting in July & August 25,552 535,910
1967 2017
Share of British Tourists 75.9% 24.7%
Share of July & August 26.2% 23.6%
Source: Malta Tourism Authority Research Unit, 2018.
The data in the table indicate that the heavy dependence

on British tourism prevailing in 1967 and accounting for
more than three out of every four tourists has been reversed;
the UK’s share stood at less than one in four tourists in 2017.
Seasonality, however, has been a tougher nut to crack, with
the loss of just 2.6 percentage points in the share of the peak
months of July and August in the 50-year interval between
1967 and 2017. In this latter case however, the reduction of
seasonality cannot be simply measured in terms of monthly
shares but also in terms of absolute figures. For it is through
the huge increases in low season tourist volumes that Maltese
tourism seasonality is being addressed rather than reductions
in monthly shares.
The negative tourism results of the mid-1980s led to
the recognition that geographical diversification and the
reduction of seasonal variations in tourism activity would
play a major role in elevating tourism into a major economic
player which would not be prone to irregular performance.
Thus, major efforts were made to open up new geographical
markets whilst also widening Malta’s appeal to a broader
range of visitor motivational interests, thus also extending the
tourist season.
The way for Malta to achieve this change was to capitalise
on the fact that it could offer the charms and attractions of a
Mediterranean archipelago with emphasis on good weather
and a wide range of activities, underscored by a vibrant local
community with its diverse culture and rich millenary history
(Markwick, 1999). For many years, however, the major
emphasis remained on the coastal dimension with the cultural
aspect taking a backseat, peripheral role. For a destination
like Malta, blessed as it is with a 7,000 year unbroken line of
human development and activity, it was necessary for cultural
tourism to become a critical component of its national
tourism strategy.
Measuring Tourism Employment
The National Statistics Office publishes data featuring the Yearly

Average Number of People Employed in Accommodation and
Food Service Activities. These statistics differentiate between
full-time and part-time employees. The time series in the tables
below feature data for the eight year period 2010 to 2017 (Malta
Tourism Authority time series collated from NSO Gainfully
Occupied Population data and revisions). Table 2 deals with full
time employment; Table 3 refers to part-time employment. Both
tables deal only with the accommodation and food and beverage
service activities sectors.
Table 2: Full-time employment associated with Malta’s accommodation and food and
beverage service sectors: 2010-2017.
Full-time
Employment 2010 2011 2012 2013 2014 2015 2016 2017
Accommodation 5,668 5,560 5,594 5,663 5,641 5,510 5,496 5,692
Food and
beverage service
activities 4,107 4,281 4,428 4,440 4,755 5,250 5,908 6,628
Total full-time
employment in
accommodation
and food and
beverage
activities 9,775 9,841 10,022 10,103 10,396 10,760 11,404 12,320
Total Gainfully
Occupied
(including
apprentices) 146,955 150,167 153,000 157,482 163,760 172,104 184,758 191,915
Share out of
total gainfully
occupied 6.7% 6.6% 6.6% 6.4% 6.3% 6.3% 6.2% 6.4%
Breakdown
of full-time
employment 2010 2011 2012 2013 2014 2015 2016 2017
Private Sector 9,702 9,811 10,022 10,103 10,396 10,760 11,404 12,320
Public Sector 73 30 - - - - - -
Males 6,784 6,848 6,960 6,977 7,125 7,311 7,677 8,149

Females 2,991 2,993 3,062 3,126 3,271 3,449 3,727 4,171
Self-
employed 1,064 1,096 1,148 1,158 1,204 1,249 1,328 1,398
Employees 8,711 8,745 8,874 8,945 9,192 9,511 10,076 10,922
Malta 9,055 9,141 9,297 9,367 9,584 9,948 10,527 11,364
Gozo 720 700 725 736 812 812 877 956
Total 9,775 9,841 10,022 10,103 10,396 10,760 11,404 12,320
Source: National Statistics Office, Labour Market Statistics, Gainfully Occupied

Population.
Table 3: Part-time employment associated with Malta’s accommodation and food and
beverage service sectors: 2010-2017.
Part-time 2010 2011 2012 2013 2014 2015 2016 2017

Employment
Accommodation 3,243 3,442 3,576 3,530 3,578 3,300 3,141 2,942
Food and 5,274 5,702 6,234 6,066 6,285 6,537 6,610 6,648
beverage service
activities
Part-time 8,517 9,144 9,810 9,596 9,863 9,837 9,751 9,590
employment in
accommodation
and food service
activities
Total Part-Time 47,239 48,690 51,327 53,174 55,884 56,788 58,069 60,819
Employment
Share out of 18.8% 19.1% 18.0% 17.6% 17.3% 16.8% 15.8%

total part- 18.0%
time gainfully
occupied
Breakdown 2010 2011 2012 2013 2014 2015 2016 2017

of part-time
employment
Part-timers
holding a full-
time job
Males 2,210 2,354 2,464 2,314 2,352 2,380 2,339 2,440
Females 772 828 884 878 935 951 973 1,055
Malta 2,749 2,915 3,064 2,921 3,029 3,084 3,049 3,198

Gozo 233 267 284 271 258 247 263 297
Total 2,982 3,182 3,348 3,192 3,287 3,331 3,312 3,495
Part-time as a
primary job
Males 2,507 2,740 2,988 3,001 3,079 3,081 3,110 2,949
Females 3,028 3,222 3,474 3,403 3,497 3,425 3,329 3,146
Malta 5,127 5,524 5,973 5,917 6,101 6,028 5,994 5,642
Gozo 408 438 489 487 475 478 445 453
Total 5,535 5,962 6,462 6,404 6,576 6,506 6,439 6,095
Gross Total 8,517 9,144 9,810 9,596 9,863 9,837 9,751 9,590
Source: National Statistics Office, Labour Market Statistics, Gainfully Occupied

Population.
An analysis of the data points to some interesting facts. In

terms of full-time employment, it is evident that employment
in these two direct tourism related sectors is being marginally
outpaced by employment elsewhere in the labour force. In
fact, while the share of tourism full-timers stood at 6.7% of
the national total in 2010, it had declined marginally to 6.4%
by 2017. In absolute terms, full-time employment in tourism
increased by 2,519 employees or 25.7% during the eight-year
period under review. During the same period, tourist arrivals to
Malta increased by no less than 69.8%, from 1.34 million in 2010
to 2.74 million in 2017.
The situation is not any much better in the part-time sphere:
the number of part-time employees captured in the statistics
has only grown from 8,517 in 2010 to 9,654 in 2017, an increase
of 13.3% against the backdrop of the 69.8% increase in arrivals
during the same period. Tourism’s share of national part-time
employment has also declined in a relatively strong manner,
sliding from a share of 18% of part-timers in 2010 to 15.8% in
2017.
Adding full and part-time together results in a total of 21,948
employees in accommodation and food service in 2017 as
against 18,292 employees in 2010. This figure excludes casual

and irregularly employed staff, particularly those from third
countries requiring a visa and others who are simply working
outside of the radar.
This measure of tourism employment is limited to jobs in
the core functions of accommodation and catering and does not
take into consideration other direct and indirect tourism-related
employment in fields such as transport, retail, entertainment,
visitor attractions, guiding, education and food production
amongst others.
A 2015 study analysed tourism expenditure to derive an
estimate of how many jobs can be directly and indirectly
associated with tourism spend (E-Cubed Consultants, 2015).
In 2014, tourism expenditure was estimated to directly sustain
around 20,500 jobs in the Maltese economy with a further,
significant, 7,000 more jobs being sustained by tourism
expenditure in the wholesale and retail trade sector. The
resulting 27,500 jobs constituted around one in every seven full-
time equivalent jobs in the Maltese economy in 2014. As is to be
expected, this presents a higher number of employees than those
in the NSO statistics.
Tourism’s attractiveness in the Maltese Labour Market
Tourism’s attractiveness, or the lack thereof, is often the main

reason attributed to the difficulties being encountered by the
tourism industry in attracting the required quality and quantity
of employees necessary in the sustained growth scenario being
experienced by the industry at present.
In 2015, the Malta Hotels and Restaurants Association
published an EU-funded study on tourism’s attractiveness as
an employer (MHRA, 2015, pp. 24-26, 44-53) The study was
motivated by a combination of factors: the growth in tourism
activity, the decline in sectoral wage relativity, the rise of the
non-Maltese tourism workforce and the decline of the domestic
employee together with the perceived failure of the Maltese

tourism industry either to attract adequate quantities of skilled
newcomers or even retain those newcomers before losing them
to other sectors.
The study provides some interesting findings, foremost
amongst which one may list the perception-gap prevailing
between those who are already employed and those outside the
industry. Those already working in tourism broadly consider
their job to be prestigious, permanent and one that provides
promising career opportunities. However, for those outside
the sector, the idea of a career in hospitality garners very low
appreciation or prestige: it can be perceived as underpaid and
a job in which one would not be proud to work in. In response
to questions on which alternative sectors they would prefer to
hospitality, respondents listed education, gaming and retail
before tourism.
This study also suggested that the tourism sector is failing to
keep in step with alternative economic sectors with respect to
wage levels. This has led to a severely diminished wage relativity,
and there are no signs of recovery in sight. This condition is
leading Maltese job seekers to prefer employment elsewhere
rather than in the accommodation and catering sectors.
Maltese Tourism Development and Tourism Employment in

Nine Phases
Tourism in Malta has evolved through various phases which

have led to different impacts on the tourism employment scene
in Malta over the years. In its six decades of development and
growth, Maltese tourism has witnessed a number of different
periods each of which created different types of employment
opportunities, challenges and issues.
Phase 1: Before the 1960s

Although travel for the masses was still a phenomenon yet to
come, this does not mean that Malta had no tourism to speak
of before its conscious attempt to develop this industry in the
1960s.
In fact, Malta was already on the itinerary of well-to-do
European travellers undertaking the Grand Tours of the 18th and
19th centuries. Malta featured in a number of literary descriptions,
ranging from that of Patrick Brydone in 1770, to others in the
19th Century including Lord Byron, Sir Walter Scott, Samuel
Taylor Coleridge and Hans Christian Andersen (Cilia, 2010).
Besides its attractiveness as a sightseeing destination, Malta was
also a destination for wellness tourism, as evidenced by Queen
Dowager Adelaide’s three month visit for health reasons in
1838/39 (Dixon, 2018).
Tourism accommodation was initially mostly confined to
Valletta, and hotel names betray a British connection: the large
number of early hotels in the capital city included the Australia,
Belleview, British (still in operation), Cecil, Cumberland,
D’Angleterre, Dunsford’s, Europe, Gran Minerva, Grand, Great
Britain, Miramar, Morell’s, Royal, St. James, Windsor Castle and
the Imperial (Zarb, 2004). (There were no less than two other
Imperial Hotels, in Sliema and Victoria, Gozo.)
Given the limited volume of tourists being attracted, it is
safe to assume that direct employment in the Maltese tourism
industry during these early years was relatively low. Employees in
the hospitality industry were, moreover, expected to undertake a
variety of tasks rather than the specialised roles and duties that
today’s tourism industry requires and expects.
Phase 2: The 1960s

Mass tourism was still in its infancy and air travel was still the
realm of the rich. Tourism was exclusive and high quality was in
demand. During this phase, Malta can be best described as an
emerging quality hotel destination for British tourists. “ When
my wife and I first moved to Malta in 1956”, writes anthropologist
Jeremy Boissevain, “the only tourists were relatives visiting

British Service personnel stationed there” (Boissevain, 1996, p.
vii). Quality hotel investment was being stimulated by a generous
development Grants Scheme run by the Malta Government
Tourist Board. The Hilton was one of the first internationally
recognised hotel chains to open in St Julians, Malta, in the 1960s.
A Grants Scheme introduced by the Maltese Government
attracted a new breed of larger capacity, higher category hotels.
A hotel list published by the Malta Government Tourist Board
in 1969 included hotels which still play a role in the Maltese
tourism industry today. The list consisted of the following
hotels: Cavalieri, Comino, Corinthia, Dolmen, Golden Sands,
Malta Hilton, Mellieha Bay, Paradise Bay, Phoenicia, Preluna,
Plaza, Ramla Bay, Salina Bay (today’s Coastline Hotel) and
Sheraton Malta (today’s Westin Dragonara). Amongst these
hotels, one notices Malta’s first foray into the attraction of
major international hotel chains: these helped in no small way
to introduce Malta as a destination to a wider set of potential
travellers through the power of their brand.
The employment situation during this period was subdivided
between jobs in hotels and jobs in catering establishments.
Owing to the higher quality element of the hotels during this
period, employees were well trained, a lot of them overseas
either in hotel schools or in placements in established quality
city hotels. Most catering employees were individuals originally
trained to serve the British services who eventually made the
shift to tourism. Tourism was thus a small but growing economic
sector with limited, though specialised, job opportunities. It was
also limited in scope in that it was highly geared and dependent
towards serving the British market.
Phase 3: The 1970s

This period can be described as the one of exponential growth of
mass tourism and tour operators. In spite of temporary setbacks
caused by a mix of internal and external factors - such as the
chilling of Anglo-Maltese relations prior to the renegotiation
of the Defence and Financial Agreement in 1972 and the 1973

oil crisis and price hike – tourism volumes to Malta increased
rapidly, assisted by political troubles and misfortunes of other
countries in the Mediterranean region: the Arab/Israeli war, the
Lebanese civil war, the military dictatorships in Portugal, Spain,
Greece and Turkey and the invasion of Cyprus. Air Malta was
set up as Malta’s national airline in 1974, creating new tourism
job opportunities in the aviation and other ancillary sectors
(Boissevain, 1977). These factors contributed to a decade of
strong growth which saw tourism to Malta increase from around
180,000 tourists per annum in 1970 to nearly 750,000 annual
tourists by 1980.
During this period, and in spite of its growth, tourism overall
was still viewed with an element of suspicion by the Government
of the day and generally dismissed as a volatile industry. The
Labour Governments of Prime Minister Dom Mintoff (1971-
1984) were more interested in creating jobs in core industries
such as manufacturing and ship building; tourism was often
reviled as a ‘servile’ (rather than a service) industry which
relegated the Maltese to ‘waiters’ juxtaposed to superior, mostly
British, foreigners. In spite of this negative perception, inbound
tourism still increased at circa 80,000 visitors per annum.
Virtually no new major hotels came into being during this
period, except for the Jerma Palace Hotel in Marsaskala, then
Malta’s largest hotel with 750 beds and just over 200 full-time jobs
(Baldacchino, 1997). This was compensated for by an explosion
in the number of self-catering apartments which came from
almost nothing but accounted for 60% of total tourist beds by
1980. The emergence of Bugibba and Marsaskala as alternative
resorts also took place during this period. The issue of quantity
rather than quality became very evident during this period.
The high dependence on British inbound tourism continued to
prevail, along with a wide seasonal spread between peak season
summer tourism and low season winter tourism.
From the tourism employment perspective, the most relevant
impact of this decade was the emergence of the part-time,
seasonal, tourism employee: a mostly unskilled worker who

moved jobs between establishments depending on demand. At
the same time, the shift towards self-catering accommodation
created a new breed of owner/developer/operator who
collectively built numerous apartment blocks accounting for
29,000 beds by the end of the 1970s.
The self-sustaining spiral of low price/low quality eventually
dragged tourism down to a point of low return. By 1981, a strong
Maltese Lira and the re-emergence of the competing destinations
in the Mediterranean (which had suffered huge declines during
the 1970s) led to a slump in Maltese tourism, to the detriment of
employment in the sector.
Phase 4: The early 1980s

By the early 1980s, a situation arose whereby international tourism
supply in the shape of destinations and tourist beds was fast
outstripping demand. This ushered in a period of price sensitivity.
For Malta, riding on the crest of ten years of rapid growth during
the 1970s, this worrying scenario was further exacerbated by the
return of political stability to the Mediterranean region meaning
that competition in the neighbourhood, comprising a more
modern tourism offer, became a sudden reality in a country
struggling with basic issues such as guaranteed tap water supply,
electricity and telecommunications.
The predictable outcome of this combination of unfortunate
events led to the decline and stagnation of Maltese tourism
between 1981 and 1986. This was mostly due to uncompetitive
pricing, Sterling/Maltese Lira exchange rate issues, Malta’s
overdependence on British tourism, the high seasonality of
tourism inflows and the tangible infrastructural shortcomings.
The immediate outcome of this period was the decline of the
recently but rapidly developed Bugibba (Chapman & Speake,
2011) and Marsaskala (Bianco, 2012). These localities saw the
rapid emergence of second homes and residential elements
commence during this period as replacements to unutilised and
obsolete former self-catering tourism stock.
Tourism employment in Malta during this period reached

a nadir: very few job opportunities were being created in an
industry in decline. The situation was compounded by mass
layoffs from the manufacturing sector, particularly the textiles
and garments sector which was also passing through a period of
loss of price competitiveness to competing countries with lower
labour costs.
Phase 5: Late 1980s

The growth of intra-European travel was the signature feature of
the late 1980s. This was stimulated by the end of the Cold War
and the liberalisation and deregulation that emerged as a result
of the single European market concept, with the Single European
Act coming into force in 1992. Simplified border formalities
also played a major role, starting off from the removal of visas
and culminating in the concept of borderless travel within the
Schengen area introduced by the Schengen Agreement in 1990.
In Malta, this phase was characterised by a period of sustained
growth spearheaded by the introduction of the Forward Buying
(Exchange) Rate subsidy aimed at addressing the fluctuations of
the Maltese Lira and Sterling in the British Market. The return to
growth also came as a result of geographical diversification and
the development and attraction of off-peak niche tourism which
started to address the seasonality problem.
In accommodation terms, this period saw the decline of self-
catering apartments which gave way to a hybrid type of serviced
self-catering accommodation called the Aparthotel. These years
also saw huge investments in five-star accommodation as a
result of a Government drive to attract quality tourism. This also
coincided with the identification of the Sliema/ St. Julians area as
Malta’s quality tourist hub.
In tourism employment terms, this was a period of boom.
The increase in year-round tourism, the attraction of continental
nationalities with new linguistic and culinary demands, the
increase in quality serviced accommodation and the overall
volume increase all led to demands for additional skilled tourism
labour. One important response to this was the setting up of

Malta’s first ever Institute of Tourism Studies in 1987, responsible
for a wide range of training courses, from hotel management to
catering, guiding and housekeeping. This was a welcome quality
leap from the previously existing Catering School which, as its
name suggests, focused exclusively on the culinary dimension.
Phase 6: The 1990s

International tourism started growing at an accelerated rate
during this period. In Europe, this was strongly influenced by
the opening of Eastern Europe after the collapse of the Soviet
Union and with vast populations seeking travel to previously
inaccessible and unaffordable destinations. It was also the age
of mergers and takeovers, with the demise of the small, local,
regional and independent tourism operator in favour of integrated
companies. This phenomenon affected tour operators, travel
agents, hotel chains and airlines. This was also the period which
saw the emergence of the Internet as a source of information.
In Malta, the 1990s featured a period of growth. The positive
effect of the new five star hotels which were the first big
accommodation investments since the 1960s, the expansion of
niche segments such as teaching English as a foreign language,
scuba diving, the ‘meetings, conferences and incentives’ segment
and off-peak group travel all contributed to the process of quality
growth and positive change.
The international trend of mergers also stimulated resort
consolidation in Malta as integrated suppliers such as tour
operators concentrated their presence in Malta in fewer resorts.
This led to the decline of areas such as Marsaskala, Gozo and
Saint Paul’s Bay from Tour Operator programmes as business
concentrated in the Sliema / St. Julians area. The “Golden Mile”
area was identified as Malta’s five-star district, while Paceville
grew and developed as a nightlife mecca. In seasonality terms,
Saint Paul’s Bay became a ‘summer only’ area while Sliema and St
Julians became the year round place for Maltese tourism.
The growth being spearheaded by an expanding tourism
industry also led to the first organised opposition to a number

of large scale projects due to environmental concerns. Such
projects included two golf course proposals in Rabat and Ghajn
Tuffieha, a large hotel development in the Munxar promontory
in St, Thomas Bay, Marsaskala, and the large-scale Hilton/
Portomaso project (Boissevain, 2004, 2010; Briguglio, 2011).
The island-wide expansion of hotel and recreational stock faced
a growing hostility from citizens concerned with its impact on
the natural environment: resistance to an application to build
the golf course in a valley near Rabat, as part of one of Malta’s
then few non-coastal hotels, also involved a petition to the Pope
(Markwick, 2000).
From the employment perspective, this was the time when a
job in tourism stopped being limited to the traditional sectors of
accommodation, catering and passenger handling. The new niches
created specialised tourism jobs in companies offering services
for areas as varied as language teaching, scuba diving, sport (Bull
& Weed, 1999), clubbing (Camilleri, 2015), the various facets of
cultural tourism and the highly technical and demanding needs
of the conferences sector spawning demand in such areas as audio
visual and animation skills. However seasonality issues persisted:
the much quieter winter periods still posed a challenge to those
who wished for the stability of a year-round job.
Phase 7: Early 2000s

Following the boom years of the previous decade, the new
millennium brought about a number of new realities resulting
from the birth pangs of a truly globalised economy. In tourism,
this was made manifest by the decline of traditional suppliers such
as tour operators which were replaced by a new generation of
companies aimed at serving a more experienced, knowledgeable,
confident and independent tourist. Foremost amongst this was
the rise of the low cost airline phenomenon.
One of the major stimuli of independent travel was the
birth and growth of e-commerce. E-commerce changed the
world wide web from a database of information to a business
portal, and changed web users from lookers to bookers. Within

Europe, the introduction of the Eurozone and the expansion of
the Schengen Agreement to include many European countries
allowing free travel within the single border impacted on how
people organised their holidays: exchange rate-free, cross-
border travel could now be planned at short notice, with no
frontier formalities and instant direct online bookings.
In Malta however, this period was driven by a strong initial
resistance to low cost airlines, leading to a period of decline and
stagnation as the country consciously deprived itself of tourism’s
fastest growing air travel segment and tried to retain a share of a
dwindling traditional market whose future was fading fast.
During this period of decline, the Malta tourism industry
developed a siege mentality wherein five star hotels started to
prey on four star business, four star on the three star, and so on,
with the net result being that the lowest levels of accommodation
were eventually phased out of the industry. The period also saw
the start of a trend which led to the loss (through conversion) of
numerous tourism properties in coastal resorts to be replaced
by residential and commercial blocks. This led to the erosion of
Malta’s mid-range tourism offer.
In employment terms, this was a subdued period and, from
the labour market perspective, tourism companies were starting
to peddle the argument that tourism payroll costs had become
too high in relation to earnings and that the effort to retain a
year-round work force was proving detrimental to company
profitability, re-investment and growth.
Phase 8: 2006-2014
This was a turbulent period during which global tourism was
rocked by a succession of pandemics, economic crises, rising fuel
costs and terrorism but nevertheless continued to grow strongly
due to its resilience. Tourism was becoming a necessity, to be
consumed at all costs, rather than a luxury requiring financial,
personal, political and medical stability to take place.
This was also the period during which independent travel and
online purchasing came of age. These important developments

led to a huge shift in travel behavior, with late booking decisions
replacing the previous situation which favoured early bookings
months in advance. It was also during this period that huge
numbers of people started to travel in a way which featured
shorter stays and higher trip frequency. The advent of low cost
carrier services in Malta in late 2006 opened the door to new
travel patterns. This was quite a contrast to the business model
of the previous four decades, dictated by the tour operator style
of holidays, with visitors staying in multiples of seven days due to
flight schedules which linked the origin and the destination on a
weekly basis only.
The introduction of low cost carriers revolutionised route
expansion: the number of cities directly linked to Malta
International Airport (MLA) almost doubled, from 45 in 2006
to 83 in 2014. This created new demand patterns for the travel
industry: patterns based on the free availability of information,
affordable aviation, new accommodation types and categories
and catering as an experience rather than a source of nutrition.
Unprecedented volume increases saw tourism to the Maltese
Islands rise from the 1.1 million stagnant plateau of the first few
years of the new millennium to reach 1.6 million by 2014. The
volume increases came about as a result of market and segment
growth namely from France, Israel, Italy, Poland, Scandinavia,
Spain, English language learning, conference and incentive,
scuba diving, cultural tourism and a variety of active tourism
alternatives.
This period also witnessed the growth of interactive social
media as an alternative to traditional media. The onus shifted
from a supplier-led industry to a consumer-driven one, with
increased demand for ‘bed and breakfast’ type, room only,
town-centre, exclusive type accommodation experiences.
Private accommodation grew as an alternative to the collective
accommodation establishments which had prevailed since the
mid-1980s.
In employment terms, this period brought about some
important and sometimes paradoxically opposed developments.

Against a backdrop of volume growth and seasonal shifts,
tourism was still plagued by industry profitability issues which
negatively impacted its attractiveness as an employer, particularly
with Maltese employees. This situation arose because, while
tourism prices started to increase in response to stronger
demand, these increases were not reflected in remuneration
packages particularly in the accommodation and catering
sectors. Meanwhile, competing emerging services sectors were
offering much more attractive earnings packages to prospective
employees.
This period also witnessed the start of an EU-worker influx
arising from Malta’s 2004 membership of the European Union
and exacerbated by very high youth unemployment in countries
such as Spain, Portugal, Italy, Greece and Hungary. This influx
consisted of young unemployed Europeans who were willing to
accept low-pay, low-skill, short-term employment conditions
as an alternative to staying in their home countries, with few
prospects of finding work.
The impact of this influx meant that, for the first time,
there was a substantial intake of unskilled non-Maltese who
did not require a work permit to work in the local tourism
industry. Moreover, the industry started to face the problem of
having substantial numbers of front-liners who could neither
speak English fluently nor possessed deep knowledge of the
destination. Finally, the local workforce was dissatisfied with
the remuneration and unsocial working conditions offered by
the tourism industry and which now found itself undercut by
a short-term, non-resident population of workers who were
willing to accept inferior pay and working conditions as a viable
alternative to high youth unemployment at home.
Phase 9: The present

The period commencing in 2015 is one which has seen global

tourism continuing to grow in an unprecedented, almost
exponential manner as travel shifts from its previous status of
an affordable indulgence undertaken at reasonable expense to a
more affordable commodity which is consumed more frequently
and regularly by wider sections of the population in more
countries worldwide.
Alternative forms of touring have also expanded, particularly
the cruise market which has grown to reach the 670,000 mark
in 2017. Although cruise passengers are not included in tourism
arrivals statistics as they are excursionists, they do bear a
relationship with tourism in terms of the tendency for a number
of them eventually revisiting the destination as bone fide tourists
and also in terms of the cruise and stay possibilities emerging
from home-porting operations such as TUI’s Mein Schiff and
P&O’s Oceana which operate Malta to Malta itineraries during
the Mediterranean cruising season.
Tourism has kept growing, fuelled by cheap air travel as a
result of lower fuel prices and the proliferation of the low cost
airline model whilst being further facilitated by the rise of a global
middle class and the removal of many of the barriers previously
associated with travel. The Maltese remain generally positively
disposed to tourism; but they are more prone to NIMBYism and
less sympathetic to hordes of visitors on their small island state
(Bramwell, 2003).
These past few years have also seen the emergence and growth
of the ‘sharing economy’ as a rapidly expanding phenomenon,
posing stiff competition to traditional tourism suppliers mainly
in the field of accommodation but also slowly creeping into other
areas including catering, transportation and even entertainment
(Borg, 2017; Feng, Ye & Law, 2016). Such peer-to-peer tourism
is wholly dependent on the existence of online platforms which
facilitate information exchange and online transactions. The
impact of such alternative tourism supply chains and the resulting
boom in demand for experiential tourism in which tourists seek
hands-on experiences are distinct from the detached, distant-
observer type of tourism prevailing until a few years back.

The growth and expansion of tourism volumes and the
resultant year-round spread into areas beyond Malta’s traditional
receptive zones and attractions coincides with the rise of the new
international phenomenon of ‘over-tourism’ (Dodds & Butler,
2019). These principles may help us to continue maximising
tourism returns without compromising the tourist experience
and host population hospitality.
While tourism is not yet being directly blamed for the
increasing fatigue in the community arising from the incessant
boom in high-density construction currently taking place, MTA
research amongst Maltese residents suggests that an element
of nimbyism is starting to strengthen: older, lower-educated
inhabitants of Malta’s less touristified South continue to be more
receptive to continued tourism growth than younger, higher
educated residents in the more tourist-active localities in the
northern parts of Malta and the island of Gozo.
This most recent trend of strong tourism growth in Malta is
however taking place within an environment of strong economic
growth by a wide number of sectors ranging from construction to
financial services and gaming, all competing for scarce resources,
ranging from land to talent. Tourism growth has also been
impressive in terms of its diversity via its strong off-peak growth,
making it a truly, year-round economic activity. This has resulted
in the need for more year-round employees, the attraction of
volumes of tourists from different cultures and still new skills
and services. The introduction of novel segments in the fields
of active, experiential and wellness tourism and the broadening
of the service aspect of the industry has enabled thousands of
small entrepreneurs, albeit with a substantial number of them
operating outside of regulations and fiscal regimes, to tap into
the expanded tourism industry, the size of which has grown
beyond the absorptive capacity of its traditional suppliers.
The employment situation during this period features a
number of novelty factors, including full employment in a
booming economic scenario and the relaxation of rules governing
third country nationals seeking employment in Malta. This has

led to an influx of workers mostly from the Balkans and Eastern
Europe working in the accommodation, food and beverage
and transport sectors. These workers have by now replaced the
previous influx of EU workers, a number of whom have returned
to their home countries following signs of economic recovery
there. These Eastern Europeans are joined by other workers
drawn from the local immigrant community, mostly comprising
African and Middle Eastern workers generally working in back-
of-house functions.
This situation places further pressures on the industry’s
difficulty to entice Maltese workers who continue to shun
tourism employment citing unsocial hours and low pay amongst
the major reasons behind their reluctance. The challenges seem
to be more pronounced within the catering sector rather than
the accommodation sector. Tourism employers also continue
to face stiff competition from other services sectors, notably
gaming and financial services, which have become very attractive
and fashionable employers in their own right.
This situation may well prevail in the traditional components
of the tourism industry; but ancillary tourism service providers
are coming on stream and providing employment opportunities
to substantial numbers of people in jobs where tourism plays
an important role. Such employment is being generated in
such fields as alternative accommodation, visitor experiences
and attractions, active tourism, wellness, special events and
occasions, outdoors recreation and a host of smaller activities
fuelled by travellers’ unending thirst for unique, different
experiences to maximise their need to capture and imbibe
special moments during each single trip of their frequent
travels.
Discussion
Tourism employment, as traditionally measured, is not growing

in a way which reflects the uninterrupted, exponential growth
which Maltese tourism has experienced, and has continued to
experience, since 2009. This anomaly can neither be totally
explained through the casual employment of individuals
through the black economy nor through the increased efficiency
of tourism operations which are becoming less labour intensive
and thus employ less employees per tourist hosted.
The answer to this dilemma may lie in the fact that tourism
has changed utterly and will continue to change. Indeed, it
might be incorrect to continue to refer to it as if it were a single
industry. The tightly defined tourism industry of yesteryear, with
employment clearly slotted into distinct, easily-defined, self-
contained areas such as accommodation, catering, transport,
passenger handling and tour guiding, has now evolved into
something more diffused, amorphous and cross-sectoral.
The growth of the sharing economy and the evolving demands
of experiential tourism are diffusing tourism employment
into a wide range of areas which, in turn, overlap with other
sectors. The latter include expatriate gaming sector workers,
the expanding migrant worker community and the increased
demand for domestic tourism experiences by Maltese residents,
amongst others.
Educational tourism, active tourism, gastronomic tourism,
film tourism, agro-tourism, eco-tourism, extreme tourism,
wedding and honeymoon tourism, music-party tourism,
wellness and health tourism are but a few of the new streams of
tourism demand which are seeing the industry evolve beyond
recognition in terms of what and where it was only ten years ago.
This situation poses new challenges. In many respects, Malta
now faces a tourism employment situation with a weak nucleus
of traditional jobs surrounded by a strong and growing outer
shell of emerging job types. Whilst the outer shell is thriving
and expanding, the all-important nucleus is stagnant at best
and in decline at worst. This poses some serious questions for

the Maltese tourism industry’s core component of suppliers
who cannot afford to outcompete themselves from the Maltese
labour market to depend even more heavily on influxes of less
trained, non-native workers with the inherent impact which that
situation would have on the Maltese hospitality offer as extended
by the industry’s front liners.
Malta’s current tourism policy extends to 2020 and is based
on a vision to 2030; it lists a number of policy responses in terms
of employment in the tourism industry which are based “on the
recognized need for a trained, cordial, informed, motivated and
committed tourism labour force, which is recognized to be a
main resource to communicate and actually provide quality to
visitors” (Ministry for Tourism, 2015, p. 57). These responses,
as summarised in the policy document, include the need for
an improvement in the quality of tourism jobs across the
sector, training for the provision of quality service, continuous
professional development and a level of basic training as a bare
minimum to work in tourism. Such basic pre-training should also
be followed by appropriate induction courses. Given the growth
of off-peak tourism, there is also a need to encourage a shift from
part-time to full-time employment. There is a recognized need
to attract more Maltese workers whilst also inculcating a sense
of Maltese hospitality and inter-cultural competence amongst
foreign front-liners. All employees should also possess a stronger
awareness of Maltese history and culture which they should be
able to pass on to visitors.
As tourism diffuses and merges with other sectors of the
Maltese economy, its capacity to attract a steady flow of skilled
professionals may become increasingly at risk. Maltese tourism
is operating in a highly competitive labour market facing
manpower shortages and more attractive alternatives, in terms
of both remuneration and working hours.
Tourism is ultimately based on service and hospitality:
no amount of infrastructural improvement and technology-
induced automation can replace the basic requirement of
human interaction on which the hospitality industry rests. This

is especially true in the collective accommodation and food
and beverage spheres which are the ones already facing staffing
challenges.
Like the atom of an element in chemistry, tourism employment
can be described as being composed of a central nucleus
comprising the traditional hospitality functions, surrounded
by bands of orbiting electrons representing the growing range
of complimentary services and experiences sought by rapidly
evolving tourist demand. As in the atom analogy, the industry’s
stability is dictated by all its components, whether those in its
nucleus or those in its electron shell. This implies that it is not
enough to keep focusing solely on employment needs and skills
in accommodation, catering and transport but it is becoming
increasingly important to target the complimentary services and
experiences sectors as well.
The training implication of such requirements is huge. In a
diffuse sector embracing different disciplines and skill subsets, it
will not be easy to weave a common tourism thread that reaches
all those involved. On the other hand, the required skills may
not be limited to tourism alone but form part of a wider need for
the country’s human resources to become more finely tuned to
the growing sophisticated needs of a service-customer, whether
the customer is one consuming tourism services or not.
As the industry changes, the current employer/employee
relationship needs to be revisited. Tourism companies need to
change the way they view their employees: from a payroll cost to
a knowledgeable resource, providing a human service to other
human beings, leading to improved tourism experiences and an
enhanced competitive edge for companies.
Conclusion: the Challenges that beckon

Human Resourcing in tourism in Malta has seen several changes

over the past decade. The HR fundamentals may remain the same;
yet, we have witnessed significant changes in the demographics
of the workforce in Malta. The limited skills and knowledge
available in the current local workforce have exacerbated an
influx of foreign labour and hence a melting pot of cultures and
diverse nationalities working alongside each other. Specifically
within hospitality, regretfully, the fact that we are seeing less
local employees who are interested in working in tourism poses
a significant challenge to the authentic hospitality service that
Malta is renowned for. One only needs to visit a few restaurants:
it is very rare these days to be hosted and served by a Maltese
person. Hence, the warmth of the service offered is, to some
extent, affected. Add to this the issue of millennials hopping on
and off jobs rapidly, their high and immediate expectations from
employers and the decreasing commitment to job tenure and
security; all these pose challenges with the continuity of service
as well as with talent development.
The constantly changing demand trends of the tourism
industry oblige businesses to be more flexible and proactive in
the way they pre-empt and react quickly to changing scenarios.
This needs to be addressed both from the employer and the
employee perspectives to ensure that Maltese tourism companies
evolve from their current, rigid, top-down management styles
to ones which allow for greater employee involvement and
empowerment at different levels. This would lead to stronger,
evidence-based decision making to ensure maximised business
opportunities and long-term sustainability. Indirectly, this
should also ensure less employee turnover and the generation
of more tourism professionals in the industry. One logical spin-
off from such changes would invariably result in crucial changes
in employment practices in the fields of recruitment and
remuneration to return tourism to its previous attractiveness as
an employer.
Achieving such changes obliges the development of numerous
soft skills: managerial, inter-personal, self-developmental,

decision-making, technological and linguistic, amongst others.
This is where future human resource development efforts for
the Maltese services sector, including tourism, lie. Global trends
and local economic indicators point towards a tourism industry
that still has untapped growth prospects, to be exploited in years
to come. Adequate volumes of trained, professional human
resources are indispensable to make such growth possible.
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Pirotta, J. M. (1987, 2001, 2016). Fortress colony: The final act: 1945-1964. Rabat, Malta:
Studia Editions (3 volumes).
Robens, Lord (1967). Report of the joint mission for Malta. 18 July 1967 Cmnd 3366.
Vella, L. (1987). The development and present state of the tourism accommodation sector
in the Maltese Islands. Unpublished Business Management dissertation. Msida,
Malta: University of Malta.
Zarb, J. (2004). L-istorja tat-turiżmu f’Malta u Għawdex. Pieta, Malta: Independence
Print.
Electronic Gaming:
Platforms of Playfulness
Dominic Cortis & Elaine Falzon
Visit an online gambling website, from a casino operator to a

sportsbook, and there is a strong possibility that there will be a
Maltese address and a Malta Gaming Authority logo at the bottom
of the page or in the ‘Contact Us’ section. This shows the scale of
the industry’s concentration in Malta. Malta hosts an array of the
largest gambling operators, and in addition, many of these large
operators host the majority of their operations in Malta.
According to Online Casino Elite (2014), Gaming is a
broad umbrella term for a number of types of play or activity.
Sometimes players play each other and the loser will lose within-
game assets, such as losing ‘weapons’ in a sorcery game. These
may have been bought using real money. Other gaming sites are
simply gambling sites, involving gambling against others or a
casino/ bookmaker. The word ‘gaming’ has become commonly
attached to gambling such that official regulatory bodies that
regulate gambling are named as gaming authorities, the Malta
Gaming Authority being a case in point. We use these terms
interchangeably throughout this chapter.
The gaming industry generated some one billion euros in
2017, contributing some 10% to national gross value added,
making the sector the third largest private contributor (after

construction/real estate and tourism) to the Maltese economy
(Cortis, 2015; Jongmans & Dullaghan, 2017). Some 6,000
individuals are directly employed in full-time equivalent jobs
with close to 300 companies within the gaming industry. Most
of these (over 85%) are employed with companies operating
on a remote gaming licence: offering services online, rather
than land-based operations (Malta Gaming Authority, 2018a).
The gaming industry has been considered the main catalyst,
be it positive or negative, for salary inflation (Vella, 2017), rent
increases (Cacopardo, 2017; Dalli, 2017) and economic success
in Malta (International Monetary Fund, 2018; Plucinska, 2017).
Wage inflation within this industry can be explained as it is a
high value added sector and most are willing to pay above the
going rates to retain talent and fill positions quickly (Vella, 2017).
Increase in property prices cannot be attributed to one element:
population increase and changes to traditional household
structures and practices – with more single member households
and more young persons and couples renting accommodation
– have helped to increase demand. Such a demand, and hence
pricing, within the rental and property markets has however not
been even across the country; it is concentrated in those areas
that are more exposed to tourism, finance and igaming (Micallef,
2018)
Why Malta
The rationale for gaming companies incorporating in Malta is

similar to other industries: political stability, straightforward
and advantageous tax benefits (Hoy, 2013; Mangion, 2010), a
strong educational background, English being one of the official
languages, besides Maltese, and lower cost of living. However,
these reasons alone do not explain why Malta has become a
major jurisdiction for this industry and why so many have set up
their headquarters here.
Gaming: Platforms of Playfulness 319
Malta has had a ‘first mover’ advantage by enacting gaming

laws and regulations as early as 2004, a year after European
Union (EU) membership (Cilia, 2016). In the early 2000s, most
gaming operators within the EU were state owned monopolies.
The main rationale for this was to protect citizens from abusive
behaviour and preventing fraud and money laundering, while
generating revenues for public goods (Örnberg & Tammi, 2011).
The accusation for advocates of liberalisation was that states
were taking advantage of their own citizens by offering worse
odds. One of the four freedoms of the EU is the free movement
of services. The prospect of a state-owned monopoly challenged
the notion of the free movement of services: is it illegal for a
EU citizen to bet online with an operator registered in another
EU jurisdiction, or is it their right? Given the absence (or clear
prohibition) of the ability to register a gaming company in many
EU countries, Malta was one of the few options where one could
get licensed and operate legally.
Over the years, various EU countries have realised that many
regulators with a concentration of operators (mainly Gibraltar,
Ireland and Malta) have robust fraud, anti-money laundering
(AML) and responsible gaming controls. The EU has also limited
any enforcement action against sports betting companies in a
situation where a monopoly exists (Criminal proceedings against
Sebat Ince, 2016). Some countries still operate a monopoly or
restrictive regulation – for example, German gambling law which
differs by state (Hofmann & Spitz, 2017) – but many European
countries allow online gambling operators to sell services in
their country subject to a permit or a point of consumption tax.
Many EU countries now replicate Malta’s simple and effective
regulatory model (European Commission, 2017). The country
continues to adapt gaming regulations especially with respect to
money laundering requirements (IMF Blog, 2018) and due to the
changing environment. For example, as point of consumption
taxes counterbalance the advantages of setting up in Malta
(Vassallo, 2018), the new Gaming Act that entered in force in
2018 taxes betting operations 5% of their Gross Gambling
Revenue generated in Malta rather than globally (MaltaProfile,

n.d.) in lieu of taxation at different countries. The 2018 Gaming
Act has been described as elevating “the jurisdictional profile of
Malta from a regulatory perspective by strengthening the MGA’s
supervisory role, specifically the compliance and enforcement
functions to better achieve the regulatory objectives, in line with
concurrent developments relating to anti-money laundering and
combating the funding of terrorism” (Malta Gaming Authority,
2018a).
Key Functions
One of the features of the Gaming Act is the inclusion of more

mandated roles within the regulation itself. Every licensee is
expected to have the following list of key functions which are
approved by the regulator:
• A chief executive or equivalent role;
• A key function overseeing the day-to-day operations of
the licensee;
• A compliance function that considers the licensee’s
obligations;
• The administrative, financial and risk management
function that includes the responsibility to pay fees to
the Malta Gaming Authority;
• A legal affairs keyholder that includes responsibility of
contractual arrangements and dispute resolution;
• A technological affairs key function that includes
responsibility of management of the back-end and
control systems holding essential regulatory data;
• A network and information security function holder;
and
• An internal audit function.
A licensee can be classified into two different types: a B2B

licence and a B2C licence (KPMG, 2018). A B2B licence stands
for business-to-business licence and such licences would offer

betting services to betting operators. For example, a company
can be specialised in producing odds for bookmakers but does
not accept client moneys. In such scenarios, the B2B licensee
may not be dealing with any third-party data, but if it does it
would also need a keyholder function responsible for data
protection and privacy.
An operator that has direct customers would be a business-to-
customer (B2C) licensee. A B2C licensee, described as providing
a gaming service in the Gaming Act (Malta Gaming Authority,
2018a), has more responsibilities towards its clients as they are
direct customers. In that respect, the management of the day-
to-day operations include the process of transferring funds from
players (deposits) and to players (winnings and/or withdrawals).
Hence, in such a licence situation, risk management is considered
as a separate function from administrative and financial
management. Additional key functions for a B2C licensee are:
• Marketing and advertising;
• Player support;
• Responsible gaming;
• A point person responsible for the prevention of fraud
to the detriment of the licensee; and
• A point person responsible for the prevention of money
laundering and the financing of terrorism.
There are additional keyholder functions for a National Lottery

licensee (permit to hold sell national lottery games) or a B2C
licensee that operates a gaming premises (Operation of urn,
gaming devices, management of gaming area/pit, management
of surveillance systems) but employment in these categories is
dwarfed by the numbers employed in remote gaming and hence
not within the scope of this chapter.
Type of Operators
Other than being a B2B or a B2C operator, a gaming operator

could be operating in many fields. These include poker sites,
bingo, lotteries, games, casinos and sportsbook operations.
Poker sites tend to offer the opportunity for individuals to
play poker, usually Las Vegas style poker, against one another
with the operator charging a commission from the pot of possible
winnings called a rake. Poker sites also profit by charging entry
fees to participate in poker tournaments.
In the cases of bingo, lotteries and games, the gaming operator
makes a profit by offering unfair winnings. For example, for a
lottery with 100 tickets at one euro each with only one winner,
that winner would be winning eighty euros; twenty euros would
be the operators’ gross gambling revenue. Different forms of
lotteries exist and not all are as riskless. For example, the operator
might offer a competition in which one must guess five numbers
from fifty to win. There is an unlikely scenario of only one ticket
sold and all five numbers being guessed.
Casinos also include a significant number of games of chance
such as roulette and dice as well as games that require some skill
such as blackjack and baccarat. The gaming operator here also
earns income in the long run in lieu of unfair outcomes. Live
casinos, which include a live stream of an actual play (such as
roulette) rather than an animated version, are very popular on
the market.
Sportsbook operators give the opportunity for punters to bet
on non-random events, typically being sports events. Although
betting on the outcome of other events such as Eurovision and
elections is possible, the most popular bets are on horse racing
and football. Betting on live scores, that is while a match is being
played, is increasingly popular. The term betting, rather than the
generic gambling, usually refers to betting on the events of non-
random external events. Betting can be arranged in one of three
methods with revenue for the operator generated either as part of
the pool (pari-mutuel betting), functioning similar to a financial
market with a percentage of winnings (betting exchange) or in

a traditional setting (Cortis & Briguglio, 2016). In a traditional
setting, the bookmaker sets odds with implied probabilities of
outcomes slightly different than real probabilities: for example,
the odds on an outcome that is 50% likely would be 1.8 rather
than 2.0; which means someone betting one euro would win
€1.80 (an 80 cents win) if the outcome occurs. There are various
research papers that show how to translate odds to and from
probabilities (Buhagiar, Cortis & Newall, 2018; Cortis, 2015;
Cortis & Briguglio, 2016; Newall, 2015).
Very few B2C gaming operators are monoline operators that
offer just one form of gambling. B2B providers tend to offer their
services in the background to a gaming operation; for example,
one can set up a sportsbook without the need to calculate odds
but instead purchase a live feed of odds from a B2B provider.
Similar set-ups exist for games and casinos. ‘Whitelabeling’
refers to the process of offering a casino/sportsbook/other
service from a third party that supplies the technological and
operational infrastructure while the front-end focuses on
branding, marketing and customer acquisition and retention.
Typically, there is a set-up fee and a proportion of the overall
winnings.
Type of Roles
Gaming operators employ significant numbers. The official

statistics seem to indicate that each company employs an
average of about twenty-five to thirty employees (Malta Gaming
Authority, 2018a) but the number of employees per company
is negatively skewed with a few operators employing large
numbers. As discussed earlier, some operators are based or have
significant operations in Malta. For example, Tipico employs
some 200 people locally, and over 6,000 people work for the
entire group and associated franchise network (Tipico, 2018);
and Betsson employs some 900 people in their offices in Malta
(Betsson Group, 2018a) from a total of almost 2,000 spread over

twelve locations around the world (Betsson Group, 2018b). It is
therefore not surprising that business support services – such
as finance and human resources management – are in great
demand, with professions such as accountants and specialised
lawyers not producing enough local graduates (Sunday Times of
Malta, 2017).
Identifying the types of jobs available in gaming is not easy:
the main challenge is that operators are set-up differently to
each other; hence, standardised departments beyond the key
functions that are required by law do not exist. The next section
provides a general overview of the job descriptions that prevail
in this industry.
IT, Security & Analysis
The development needs of remote gaming operators have produced

a scenario where demand for skills far exceeds supply, in spite of
the increase in the number of qualified individuals graduating
from local educational institutions. This has led to online gambling
operators diluting or outsourcing some of their development skills
to Eastern Europe (Sunday Times of Malta, 2017).
Gaming is a data driven business, and so technological and
data analysis skills are in high demand. Indeed, most advertised
vacancies on gaming group sites and specialised recruiters
require information technology (IT) or a science, technology,
engineering (or) mathematics (STEM) background. The
European Gaming Institute of Malta, a joint venture between
the MGA and MCAST set up to deliver training and educational
programs for the gaming industry, offers a range of modules; but
the majority of these are technology or analysis based, dealing
with such topics as gaming software applications as well as SQL
and NoSQL databases (EGIM, 2018).
Remote gaming sites are attractive for cyber criminals due
to the money involved. Moreover, having any data breach leads
to a significant response from regulators. In 2010, hackers stole

the personal details of around 650,000 Paddy Power users.
Although the company had ‘suspected’ a leak at the time, it
did not inform its users or regulators. It was only in 2014 that
this issue came to light to the public, after the company tried
to seize the hacker’s computers in Canada (Sparkes, 2014).
Paddy Power was only admonished by the Irish Data Protection
Commissioner at the time for failure to observe the voluntary
code of practice (Stegmaier, Hall, Rubio, & Bames, 2014). Things
have changed since then, as operators are now obliged to inform
affected individuals and the regulators of any such hacks within
72 hours of their occurrence, otherwise risking liability to hefty
fines (European Union, 2016). There has been a lot of focus on
the substantially large fines that generate with the General Data
Protection Rule (GDPR) in relation to non-compliance. A fine of
€20 million, or up to 4% of a company’s annual turnover, would
be a consequential amount for any company to have to pay.
Operators need to be equipped with the staff to carry out
an investigation, inform regulators and impacted individuals of
the breach, identify what personal data has been compromised
and how, and draft a comprehensive containment plan (Ryan,
2018). Moreover, cyber security analysts should be mindful
of breaches from other institutes. As individuals may have the
same details, including username, emails, security questions and
passwords on one website, which need not be a gaming operator,
cyber criminals can attempt to use these same details to access a
player’s online gaming funds.
I-gaming companies have large amounts of sensitive as well
as personally identifiable information (PII) customer data; and
so, they often find themselves as the profitable targets of cyber
criminals. Customer accounts are the typical main targets;
but operators live in fear of a large-scale attack on their own
network. For example, a distributed denial of service (DDoS)
attack reduces a website’s performance through large volumes
of illegitimate traffic; while malicious scripts, possibly after staff
members click a link, may stop internal systems from functioning
(ZoneFox, 2017). Having cyber security analysts at hand in any

online operation is critical. It is estimated that bookmakers
William Hill, who were on the receiving end of a DDoS attack
in 2016, might have lost over £4 million in revenue due to a 24-
hour service outage (McFadden, 2016).
Other than the roles focused on having a safe website – which
ranges from web designers to cyber security analysts – analytical
skills can fall within any category of the business and where one
is placed depends on how the gaming operator is structured.
The role of an analyst could be to focus on providing data and
insights on how different promotions are affecting the business.
For example, a remote gaming company with a sportsbook and
a casino may have had an offer of a free roulette spin if a bet
was placed on a certain soccer match. The analyst’s role would
then be to assess the viability and success of such a scheme, such
as: what type of client interacted with such an offer; whether
clients changed behaviour (ideally by interacting more with the
website) after this offer, and its profitability. The question then
is that such a role can easily fit within a marketing team or a
business intelligence (BI) team, which is concerned with trying
to make sense out of data. Depending on the size and culture
of the operator, roles would be set in different departments. A
smaller operator is more likely to have a small BI team that feeds
key performance indicators (KPIs) to other departments rather
than have specific BI skills within each team. Nevertheless, as
data literacy increases and with more mergers and acquisitions,
one would expect basic BI skills to be vital in every department,
irrespective of how an operator is structured.
Marketing
Marketing is a dynamic area of business within gaming, especially

within the remote sector. Gaming operators have increased their
marketing campaigns in traditional media as well as through
numerous sports sponsorships. Similar to other business sectors,
marketing roles tend to vary by operator; but there are five key
areas in which marketing campaigns are pursued: pay per click
(PPC), pay per view (PPV), search engine optimisation (SEO),
affiliates and social media. These techniques are not mutually
exclusive: marketing campaigns seldom involve only one
method. All these areas require technological understanding as
well as analytical skills with a dose of creativity.
Pay per Click / Pay per View

PPC is a method in which the gaming operator joins a search
engine’s (such as Google) or other website’s PPC program,
creates a banner or a small text ad that would link to the
operator’s webpage. If using a search engine, this usually involves
adding which keywords or keyword phrases should lead to the
advert being displayed (Kent, 2006). Usually, one loads one’s
search engine’s account with an amount of money and decides
the maximum amount to pay per click (say 5 cents per click) or
maximum daily expenditure. The search engine’s PPC program
then displays the ads depending on the highest bid offer for
each keyword, available funds and score such as click-through
rate, relevance and the quality of the link. An advertiser’s ads
may not be visible due to another adviser offering a higher pay
per click. A key skill involved in this aspect is knowing how to
use Google Analytics to evaluate the effectiveness of a campaign
shown through Google Ads, Google’s search engine program.
This program also feeds in to third party websites. For example,
an individual might have a blog about sports and signs up to
offer space on the website for Google Ads. The gaming operator
is paying Google Ads for the PPC advertising being shown on
the individual’s blog who receives part of the proceeds. PPV, or
display marketing, operates in a very similar manner; but it is
paid per each view rather than per click.
Search engine optimisation

In essence, SEO is the process of increasing the online visibility of a
website on search engines; mainly Google. On making any search
on Google, many results are visible and a strong SEO activity

would lead to a website being one of the first being displayed.
The google search engine has evolved over time and while it
was possible to game the results in the past by purchasing more
ads. Currently, Google uses RankBrain, an artificial intelligence
algorithm to score different websites. With this technique, better
sites with better ranked information show first in the search.
One can also imagine a future whereby searching on google will
lead to one ‘perfect’ result (Gorodetsky, 2018); similar to some
current searches for, say, “weather in Malta”. Better sites mean
having good reliable content, and not just a great design. For
example, Wikipedia shows up on a Google search because it is
considered a trusted source.
Typically, SEO is considered to be a combination of on-
page and off-page SEO techniques (Zilincan, 2015): these are
sometimes referred to as an on-site and off-site SEO. On-page
SEO relates to elements that one can control, such as contents,
titles, domain name, internal links and site map (Zilincan, 2015).
Off-page SEO includes elements not controlled directly by the
publisher such as social networks, blogs and forums. A higher
off-page SEO score of a website is dependent on many things and
not just on having links to one’s own website. For example, links
from more reputable sites and mentions of the brand increase
the off-page SEO.
SEO skills are hard to find as these are skills that are not
currently taught in tertiary education in Malta. One of the best
ways to learn is to create a website for a hobby or something of
interest; this would challenge a new individual to buy a domain,
alter a website and buy advertising.
Affiliate marketing
Affiliate marketing is performance-based internet marketing,
whereby a firm pays for each customer referred to it by affiliates
(Dwivedi, Rana, & Alryalat, 2017). For example, a blog on betting
can have reviews of different betting sites with links to sign up to
these sites. The affiliate (the blog in this case) would earn fixed
costs from depositing players, pay per click advertising and more
importantly revenue sharing agreements (such as a percentage
lifetime commissions of income generated by each lead). The
skills of those involved in the affiliate marketing of a gaming
operator include being able to negotiate and build relationships
with new and current affiliate partners. Some of these affiliates
are very successful, with some the largest affiliates reporting
making a million dollars of profit a year (Heitner, 2016).
Social media
The use of social media for marketing campaigns is vital for any
form of business and so it is no surprise that gaming operators
are very active here. The social media element is typically
aligned with the brand that is being built. For example, Paddy
Power tends to be on the controversial but humorous side; while
Ladbrokes uses the element of a group of friends betting, each
with a different characteristic (Ladbrokes, 2014). This advert
streamed on television, in their shops but was also part of their
general brand.
Gambling is treated as a vice to control; as such, increasing
bettors’ participation can be considered as a ‘dark nudge’
designed to exploit gamblers’ biases and weaknesses (Newall,
2018). Operating within a gaming environment also requires
knowledge of laws and regulations which may be different by
medium used and location. As an example, all advertising related
to real money gambling are allowed on Facebook Ads only with
prior written consent. Moreover, technical skills are vital as fraud
is possible in all these cases, for example bots in PPC campaigns
(Midha, 2009) or bogus customer signups in affiliate marketing
(Brincat, 2017).
Sportsbook
Improving the content of one’s website increases on-page
SEO which is why many sportsbook operators continuously
upload content on their sites. Therefore, there are roles that
involve writing content for sportsbook operators. Typically, a
content writer needs to be an avid sports fan with writing and

organisational skills. The writer would need to work across
different sporting calendars and use different means of writing,
such as long and short articles and social media posts. Content
writers who can write in different languages are in great demand.
As the main product offering of a sportsbook are odds
on outcomes, such as World Cup winners, there needs to be
specialised staff to create and manage odds. The creation of odds
is typically entrusted to bookmakers whose responsibility is to
translate probabilities and preferences into odds. Bookmakers
tend to have mathematical skills as well as an understanding of
how sporting events work. Over time, the creation of odds has
become an automated process such that programming skills are
very useful. In this respect bookmaking teams tend to include
mathematicians, sports experts and programmers. Many B2B
operators offer a stream of odds to B2C operators, with the latter
usually managing the risk.
Managing risk involves monitoring the volume of bets
on different outcomes as well as updating actual results. For
example: if all bets were placed on Brazil to win the 2018 football
World Cup, the operator might run the risk of ruin if such an
outcome occurred (It did not!). Live betting occurs while an
event is taking place; for example, betting on the winner of a
football match after only sixty out of ninety minutes have been
played. The role of traders is to monitor these volumes especially
during live betting. A large volume of bets on one outcome might
mean that odds are incorrect. For example: an operator might be
offering odds on scoring more than two goals for a match that is
already 2-1.
As odds ratemaking has become automated, every company
tends to show similar odds with small changes to odds to reflect
local preferences. Unlike financial management, there has been
no legislative implementation of solvency requirements to
measure liquidity concerns (Cortis, 2019).
Fraud
Risk for betting companies is typically focused on customer-

based risk management whereby processes have been set up to
help aid against financial losses by preventing, detecting as well
as investigating all instances of fraud. The Fraud team generally
works closely with other areas of the business; such as payments,
anti-money laundering, compliance and the responsible
gambling teams. They also maintain constructive relationships
with external payment providers, financial institutions and law
enforcement agencies.
Individuals working within such areas tend to focus on
document checking to confirm identities, identifying suspicious
activity such as money laundering and/or promotion abuse,
handling such cases as well as liaising with the regulator with
respect to specific complaints such as account closure.
They may be valuable marketing tools, but promotions are
highly susceptible to abuse. This is because they are often ‘one-
off ’ and unique per customer. IGaming companies know this is a
threat to their businesses and are now employing specific teams
to help minimise any losses due to this. Promotion abuse is not
to be taken lightly: in 2012, a man was sentenced to three years’
imprisonment in the UK for using fraudulent identities to take
advantage of online gambling bonuses. The scam was identified
when an online betting company received scanned copies of
two UK Passports bearing different names but the same picture
within 12 minutes of each other (Massey, 2012).
Customer Care
Just like other remote businesses, gaming firms tend to have

significant employees focused on customer care. These workers
are usually the first point of contact for clients and liaise with
all other departments, especially trading and fraud. Working
in customer care means having the customer as focus whilst
maintaining a strategic and ‘bigger picture’ point of view.

Customer care roles are more likely to operate in shifts due to
the 24/7 nature of the business; many consider this as the entry
point to working in this industry.
Conclusion
Being a very specific, relatively new and significantly growing

industry, open job positions within this sector are either filled
internally – such as starting out in customer care and moving to
fraud – or by moving from one company to another, especially
by moving from similar industries such as telecommunications,
software and other internet ventures. The skills required for
roles vary by the position: more mathematically inclined
individuals may be opting for back office analytical roles such
as risk management while content creation is more creative. Yet
some common skills arise: IT proficiency, flexibility in role rather
than expecting rigid roles and being inquisitive in nature. These
skills are especially important if working in fraud. The MGA
published its first detailed skills gap analysis in 2018 showing the
skills required for a multitude of roles – this document is a useful
resource to refer to within the sector as it shows the breadth of
positions available in the industry (Malta Gaming Authority,
2018b).
Operators tend to have different cultures but they also
assimilate cultures: at the time of writing, most forms are
focusing on a fun working environment coupled with many
financial incentives. For example, most operators offer retention
incentives such as additional days of leave after five years of work
with the same operator; or an annual bonus, varying from €500
to €3,000, for recommending new employees that successfully
pass their probation period. Most operators recognise the need
of a work-life balance and hence offer an on-site gym facility with
periodical yoga and training instructors as well as additional
events such as onsite barbeques. Most operators also offer free
or subsidised parking facilities to employees and staples such

as health insurance. Some operators have taken it up a notch
by offerring free breakfast, lunch and dinner; but the majority
either offer one of these for free or free fruit. However, during
intense periods of work, such as World Cup or Cheltenham horse
jump races, food is offerred throughout the period to employees.
All foods cater for different needs: halal, vegan, vegetarian and
kosher. One can notice that very few operators offer childcare
facilities possibly due to the government offering this service for
free. An anonymous interviewee mentioned that her rationale
for moving to the Maltese operation of her employer was heavily
conditioned by the availability of these childcare facilities.
Some operators are sufficiently large to have created different
sub-cultures between departments: for example, developers tend
to have characteristics dissimilar to marketing. These differences
in cultures are generally brought about and nurtured by loosely
structured, non-hierarchical set-ups, with teams wielding
different skills coming together for a project, and reassembling
for another.
The lack of specific courses on gaming hinders a direct entry
route that may exist for other, more traditional industries.
However, having followed a short course would be an indication
of a willingness to learn more and this industry is currently
able to take less experienced individuals and train them at the
workplace.
A key challenge for gaming operators is retention: employee
turnover is relatively high when compared to other industries.
The workforce is relatively young; and new companies
headquartering in Malta tend to go on a hiring spree, instigating
a move of talent.
As the industry consolidates its importance to the Maltese
economy, and as it ventures into other areas, such as e-sports
and distributed ledger technologies, the human resources aspect
of this industry is expected to continue to evolve in step.
Acknowledgements
We thank Chanelle Demanuele (Pentasia), Charles Polidano

(Tipico Ltd), Christopher Vella (The Conexus Group), Claudine
Zahra (Hero Gaming), Eitan Gorodetsky (Betsson Group), Ian
Farrugia (Stanleybet Group), Jeremy Harding Roberts (Game Plan
Ltd), Jonathan Pace (Tipico Ltd), Rianne Falzon, members of staff
at the Malta Gaming Authority and many others for their time
and insights. Any errors or opinions remain the authors’ own.
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Small and Medium Scale
Enterprises:
Loyalty and Family
Nathaniel P. Massa
Dating back at least to Adam Smith (1776), economists had

identified both physical and human capital as key resources for
generating economic activity and value (Grant, 1996; Guthrie
et al, 2012; Nahapiet & Ghoshal, 1998). Subsequently largely
forgotten, the concept of human capital was revived in the 1960s,
“reaffirming its links with economic growth and … emphasizing
its importance in explaining earnings differentials” (Laroche,
Merette, & Ruggeri, 1999, p. 87).
Meantime there has been a shift of emphasis, away from
value traditionally attributed to tangible aspects of the industrial
economy, towards increasingly higher-value services and
intangible aspects of knowledge:
the rise of the new economy is characterised by global competition,
advanced technologies, a virtual 24x7 workforce [in some instances],
and an almost ubiquitous world of online business transactions free
of geographical boundaries [This] has made information, structural
and tacit knowledge, intuition and domain expertise – including
its net nuanced outputs, namely, intellectual capital – integral and
invaluable in contributing to sustainable competitive advantage
(Gupta, Massa, & Azzopardi, 2016, p. 438).
In the context of SMEs, this intellectual capital primarily

resides in tacit experiential knowledge, and is entwined and
embedded in the organisations’ human capital: their owners’
and employees’ potential, skills and capabilities, informal
interactions and processes. This is typically more so in the case
of family businesses which tend to be more organically run,
embracing less formal management approaches and involving
familial interaction.
In such situations, the critical importance of human capital
at a broader national and regional policy level becomes self-
evident also with respect to implications on socio-economic
value generation and national competitiveness; besides the
strategic effects on firm-level competitiveness and survival. This,
especially so when one considers that small- and medium-sized
family businesses (SMFBs) are by far the most prevalent types of
enterprise the world over.
Context
In the first instance, one should note that no universal SME defi-
nition exists, and qualification varies. For example, taking em-
ployment as a size determinant, SMEs in the United States are
typically capped at ‘less than 500’ employees; this is double the
EU SME threshold. In Australia, South Africa and Singapore,
the upper limit is 200 employees; and in Nigeria and Kenya, it is
only 100 workers. Noting this divergence is important for policy
and support measure eligibility, as well as research and meth-
odological implications, including statistical equivalence and
crosscountry comparisons. For the purpose of this research, the
EU SME definition is here adopted:
Small and Micro-Enterprises: Loyalty and Family 339
Table 1: EU definitional criteria for SME qualification.
(SME) Company Balance sheet total

Staff headcount Turnover
category
Medium-sized < 250 ≤ €50 million ≤ €43 million
Small < 50 ≤ €10 million ≤ €10 million
Micro < 10 ≤ €2 million ≤ €2 million
Source: EU. European Commission recommendation (2003/361/EC). I. 124/36. Official

Journal of the European Union 20.5.2003.
Upfront, SMEs are universally acknowledged as the ‘motor’

of economic growth and entrepreneurial activity (European
Commission, 2017; European Investment Bank, 2016; Floyd and
McManus, 2005; International Trade Centre, 2014; Karadag,
2016; OECD, 2010; World Bank, 2016).
Ranging from sole proprietors to large international
enterprises, family businesses make up between 65 to 80% of
all European companies, accounting for around 40 to 50% of all
jobs created (European Family Business, 2018). Family business
representation varies among EU member states, but family
businesses in Malta are estimated to constitute circa 70% of the
total number of firms.
This increasingly acknowledged importance of family
businesses was brought to the strategic fore by José Barroso,
then President of the European Commission:
Family firms are crucially important for Europe. They make a
significant contribution to Europe’s GNP and employment,
and tend to be great innovators, with a longerterm vision. They
also tend to be firmly rooted in their regional and national
culture, displaying the sort of European values that we all share
(European Commission, 2007, p. 2).
In Malta, a survey of family businesses, defined by the

(different) exacting criteria set out in the new Family Business
Act, observed a greater incidence among ‘small’ and ‘medium’

sized enterprises (as opposed ‘micro’). From an economic
activity perspective, in absolute terms most family businesses
(as defined by the Act) operated in ‘Industry’ and ‘Wholesale
& Retail Trade’ sectors; but, they were proportionately most
dominant in relation to non-family businesses in the smaller
‘services’ sector (National Statistics Office, 2017a).
With respect to size, while ‘family business’ classification
does not automatically imply SME qualification (e.g. a large
multinational business could in fact be a ‘family business’),
globally SMEs nonetheless constitute the absolute majority of
enterprises (family business or otherwise). In Malta, as in the
EU, 99.8% of all enterprises are SMEs (European Commission,
2017), with “the vast majority being family run” (PWC, 2016,
p. 4). However, notwithstanding this basic similarity, Malta’s
structural and circumstantial context comparatively renders
local SMEs markedly more critical and important in this
regard. For example, ‘Micro’ organisations employing less than
10 employees are significantly more prevalent among Maltese
SMEs. In Malta SMEs employ almost 80% of private sector
employment, when compared to the 66% EU average. SMEs
in Malta also generate 82% of the Maltese economy’s value
added compared to a much lower 56% EU average. This marked
comparative disparity in relation to the EU average regarding
the significance and contribution of Maltese SMEs is forecasted
to continue to progressively grow wider well beyond 2018 –
most especially with regards to value added contributed to the
economy (EC, 2018) – emphasising the further importance of
SMEs to the Maltese economy.
Between 2012 and 2016, the number of registered commercial
firms in Malta grew from 72,031 to 95,333, a 32% increase
(annual new company registrations almost doubling from
6,500 in 2012 to 11,032 in 2016), while businesses winding up
increased marginally: from 4,293 (in 2012) to 4,990 (in 2016)
(NSO, 2017a; also Grech, 2018). With respect to economic
activity trends, most births were registered in areas related
to financial services; scientific and professional services; and

rental, agency and administration. Enterprise deaths rates were
highest in traditional wholesale and retail trade (albeit, among
the overall enterprise population this sector still remained the
highest represented and most prevalent form of economic
activity). Otherwise, other sectors representing high deaths
were similar to those sectors highly active in new enterprises,
including financial service activity; scientific and professional
services; and rental, agency and administration services. These
trends indicate a tendency towards highervalue and knowledge-
intensive services in a context of competition and turnover;
typified by Mata’s small market circumstances.
Challenges and human capital considerations
A European Commission study (2017, p. 23) reporting on the

‘issues and challenges faced by SMEs’ states that, between
2012-2017, SMEs have indicated ‘finding customers’ to be their
top concern (25%); followed by ‘availability of skilled staff or
experienced managers’ (20%). Concerns on ‘access to finance’
were only indicated by 9% of SMEs. These top two SME challenges
loom even larger in Malta’s small island state context. In the case
of the first, Malta’s domestic market size limitations and the
extent of competition impose structural limits to market growth,
and a shift towards internationalisation in order to ‘find more
customers’ beyond Malta shores becomes almost inevitable. In
the case of the second, a comparatively small labour pool in an
economy close to full employment, and with local subsidiaries of
multinationals vying for talent, intensifies competition for scarce
human resources.
Faced with general trends of increasing globalisation and
intensifying competition, family businesses likewise cited the ‘war
for talent / recruiting skilled staff ’ as by far their top-most ‘major
concern’ (cited by 43%, up from 32% in 2015) (KPMG, 2017) –
again underlining the importance of human capital. In Malta’s
case, family businesses similarly state that ‘staff recruitment’

was their key internal issue (46%), indicating for example the
quest ‘to find management know-how’ and ‘attracting quality
people’ (PWC, 2014). The rising concern and intensifying
quest for talent and human capital is compounded by generally
dropping unemployment rates across the EU. This is even
more evident in Malta’s tight labour supply situation (Eurostat,
2018a, 2018b; Times of Malta, 2018), making it challenging
to attract or develop, as well as retain, the talent needed; and
pitching SMFBs in a hopeless competition with deeppocketed
multinationals in particular sectors such as finance and gaming.
The second highest ‘major concern’ cited by family businesses
globally was “increased competition” (37%). This is mirrored by
Maltese family businesses, stating that ‘market conditions / Euro
uncertainty’ (68%) and ‘competition’ (41%) were the two top-
most external issues perceived: both indicators markedly higher
for Malta than the global average (PWC, 2014).
Locally, the potential for flexibility, creativity and
entrepreneurial flair in swiftly exploiting opportunities is
evident. In these competitive scenarios, where proverbial
‘necessity’ may well be the ‘mother of invention’, all else being
equal, the foresight, innovativeness, talent, connectedness and
potential of these small firms’ human capital – in interpreting
future options and executing strategies towards opportunities
carved from among unclear alternatives – is what drives and
internally determines their prospects for competitiveness,
business success and survival.
In this regard, Malta’s potentially restraining market size and
island status, and associated SME prevalence, may very well be
a key ‘necessity’ trigger for Maltese businesses’ ownermanagers,
nudging them towards innovation and enterprising activity. At
a macro level, Maltese SMEs display both resilience as well as
an ability to prosper and thrive; even in testing circumstances
(Central Bank of Malta, 2010; European Commission, 2018).
Internationalisation and the Maltese context
From a definitional perspective, ‘internationalisation’ comprises

various modes of entry into foreign markets entailing varying
extents of commitment, such as exports or foreign direct
investment. ‘Internationalisation’ also includes ‘inward’ activity
where raw materials or inputs into the organisation’s production
or operating processes are sourced from abroad.
Within the broad scenario of globalisation, shrinking distances,
morphing markets and intensifying competition, the European
Commission acknowledges that the internationalisation of
SMEs “is crucial for Europe’s competitiveness, economic
growth and innovation” (European Commission, n.d., SME
internationalisation portal). The top three barriers to small
business export activity and internationalisation are, perhaps
surprisingly, all internal, and are all associated with knowledge
(Leonidou, 2004): (1) limited information to locate and analyse
markets; (2) an inability to identify and contact overseas
customers; and (3) the failure to identify foreign business
opportunities.
Internationalisation will be increasingly hard to avoid:
by 2030, some 60% of global GDP is expected to come from
emerging and developing markets; and SMEs will be expected to
participate in global value chains as a result of increased market
integration. Moreover, internationally active SMEs generally
also create more jobs, are more innovative, and generate higher
turnover growth than domestically-focussed SMEs (EC, 2010 p.
69-70). The additional complexity, capacity and reach generally
required by international growth bring along the need for
investments in critical resources, crucially in knowledge and
enhanced human capital – beyond mere staffing – in order to
sustain and drive forward the innovation and competitiveness
necessary to flourish in international markets.
In spite of an EU-wide ‘common market’ and streamlined
regulations to facilitate the movement of people, goods, money
and services, just 25% of EU SMEs engage in export; half of
which to other EU markets (EC, 2015). And only 2% of EU SMEs

were engaged in foreign direct investment (FDI) (EC, 2009).
Beyond EU generalisations, Malta’s island status, small
size and limited (especially physical) resources bear intrinsic
implications, particularly on traditional production,
diversification and a tight labour situation. A small open
economy dependent on foreign trade and tourism, necessarily
seeks growth through international trade and FDI in high value
sectors. That said, Malta’s context nonetheless holds serious
challenges to firms seeking access to foreign markets. Physical
segregation and distance from the European mainland present
additional transportation and logistics costs.
A small island economy quickly imposes an off-island
orientation to any local entrepreneur. An ‘export or perish’
syndrome may be powerful enough to make up for the absence
of valuable domestic firm rivalry that elsewhere pushes firms
into higher quality products and processes at home, creating
competitive advantage (Briguglio & Buttigieg, 2003, p. 7;
Porter, 1990, p. 92). Absence of raw materials requires most
manufacturing firms to directly or indirectly internationalise
‘inwards’ in the process of sourcing suppliers. The European
Commission (2009, 2010, 2015) reports, that among European
countries, Malta has by far the highest proportion of SMEs
engaged in direct imports: some 75%. The EU average is only
29%. Cyprus, another small island state, reports the third highest
extent of SMEs with direct imports among EU member states, at
66% (European Commission, 2010, p. 24).
Malta’s size limits its options for diversification and economies
of scale, while enterprise or industry ‘thinness’ limits the
establishment of a critical mass of expertise through the clustering
and knowledge sharing normally resulting from proximate local
networks. Baldacchino (2005a, p. 22; also 2005b) underlines
the contextual implications presented here, stressing that these
challenges can be daunting to manufacturing businesses: “…
small territories, especially small-island regions, share a set of
characteristics which pose specific development problems”.
Despite the structural challenges, costs and liabilities, as well

as the added risks associated with internationalisation, foreign
companies and multinationals have operated profitably from the
Maltese Islands, ever since they started coming to the country in
the context of its first development plan (1959-1964). The same
contextual characteristics may potentially present the opposite
side of the same coin – resilience (Briguglio, 2014), possibly
pushing firms seeking growth and survival beyond Malta’s
restricting shores. The island geography and size encourage
specialisation in knowledge-intensive manufacturing activity
as well as in intangible services (finance, tourism, ICT, gaming,
consulting) that are not so challenged by small size and insularity
(Baldacchino, 2015). “[B]eing an island does not seem to be the
handicap to economic performance that one would intuitively
expect” (Armstrong & Read, 2003, p. 255).
Approach and profile of SMFB enterprises under study
Insights that contributed to this chapter build on a broader study

undertaken by the author, exploring the internationalisation of
small and medium sized Maltese family businesses (Massa, 2012;
Massa, Jones & Morgan-Thomas, 2014). A qualitative, case-based
methodology was adopted, enhancing investigative in-depth
analysis and context-specific interpretation. The research offers
useful insights by targeting a spread of SMFBs varying in size,
age and generational leadership, active in different industries,
and engaged in internationalisation to varying extents.
Eight SMFBs were reviewed, ranging from 28 to 116 years in
operation at the time of the study, and spanning founder to third
generation management direction at the helm. Organisational
size ranged from ‘small’, with 22 employees, to 140 at the
‘medium’ end. Their outward international activity was varied,
including novice and experienced internationalisers engaged to
different degrees of commitment to foreign markets.
Table 2 offers a profile of the SMFBs involved in the research.
Pseudonyms are used to protect firm identity.
Fired Pride
Table 2: SMFB Profile Overview.
SMFB 1 SMFB 2 SMFB 3 SMFB 4 SMFB 5 SMFB 6 SMFB 7 SMFB 8
Glo Fresh Wine Fired Sun Pro Vega Star

Glass Catch Divine Pride Deli Joiners Font Snack
Boutique Handcraft. Tomato
Primary Mouth- Fisheries Furniture General Biscuits
vintners artisan processing
economic blown & seafood joiners & & book & bagged
& wine ceramics & & food
activity artistic glass processing retailers printing snacks
production items preserves
Full-Time 44 88 80 22 140 90 100 90

Employ-
ment (Small) (Medium) (Medium) (Small) (Medium) (Medium) (Medium) (Medium)
Year
Operation 1968 c.1968 1907 1964 1916 c.1894 c.1982 1965
Established
1st 2nd 3rd 2nd 3rd 3rd 1st 1st & 2nd
Generation
at the helm
generation generation generation Generation generation generation generation generation
%
40% c.90% c.5% 15% 66% 30% 70% 50%
exports
Inter-
national
Exp. Exp. Novice Novice Exp. Exp. Novice Novice
experi-
ence
Year
starting
1971 1989 1998 c. 2004 1996 1979 2000 2004
regular
exports
– Direct – Direct – Direct – ad hoc – Direct – Direct – Direct – Direct
export export export exports export export export export
– Franchise – Contract – Franchise – Contract
– Joint – Joint
Venture Venture
Mode/s of – Foreign – Foreign
Interna- Direct Direct
tionalisa- Invest. Invest.
tion
Source: Massa, Jones & Morgan-Thomas (2014) and Massa (2012)

Insights on Human Capital and Resourcefulness
Managing an international business is different from managing

a firm with a domestic focus in a national market. Various forms
of knowledge, in and of themselves, impinge on opportunity
recognition and exploitation, risk perception and strategic
competitiveness: all are critical in international business
(Johansson & Vahlne, 1977, 1990), more so in the context of
typically resource-restrained SMEs and smaller family businesses:
seeking to offset liabilities of foreignness and newness, besides
smallness.
From another perspective, knowledge acquisition is sometimes
the very motivation and primary intent for internationalisation.
This is the basis for the ‘knowledge-based view’ of the firm:
the notion that knowledge is the most strategically significant
resource of a firm, nested in organisational culture and family
identity, employees, policies, routines, documents and systems.
Such a resource is usually tacit and embedded, difficult to imitate,
replicate and socially complex; yet, these very characteristics also
further render it a key determinant of competitive advantage
and its sustainability (Penrose, 1959; Barney, 1991; Grant, 2002).
Human capital
The key source of motivation driving these eight SMFBs forward
on their (occasionally strategic) intent to internationalise and
expand, was in the main, clearly embodied in the founders /
generational owner-managing directors (MDs) at their helm
(referred to below as the pioneers). Their entrepreneurial stance,
volition, resilience and resourcefulness, in various instances,
directed them to pursue potential (in instances serendipitous)
foreign opportunities, in unknown territories speaking unfamiliar
languages – at times in unlikely circumstances, against the odds,
and grain of reason and logic – and come through, not always
unscathed, learning along the way.
In many respects, the visions and personalities of these
pioneers was typically embodied and inextricably linked to the
very culture of the SMFBs they directed (Sorenson, 2000, p.

198). References to “my baby” and putting their “heart” into their
business are common. This intimate affinity and motivation,
drive, stock of experiential knowledge (often transcending
generations) lent itself well as part of their organisation’s
legacy and brand. It also linked easily with the often traditional
nature of their augmented product, in enhancing and assisting
internationalisation: through an inferred perception of strong
trust in relationships sought and maintained, preserving the
business reputation and family name. This is typical in the case of
family businesses, given their generally longerterm perspective
and tendency for patient capital.
Across all eight SMFBs (‘novice’ and ‘experienced’
internationalisers, spanning ‘small’ and ‘medium’ organisations),
with respect to the skills and knowledge held by the founder /
owner MDs (internationalisation related or otherwise) – these
were clearly not derived from formal education. Knowledge
was primarily tacit and experiential, at times also accrued
over generations or vicariously gained through exposure, and
informally attained through social interaction and mostly
informal networks and associations – including those with
foreign suppliers or encounters in international contexts.
Six out of the eight pioneers had not progressed beyond
compulsory secondary education; three of these had dropped
out early, eventually founding their business. One had an
unfinished diploma in finance and another had a theology
degree. This low prevalence of formal education corresponds
to typical observations in the literature about family business
leaders (e.g. Hall & Nordqvist, 2008). Across the board, it was the
pioneers’ experiential knowledge, foresight and contacts, sheer
determination and enterprise that characterised their personal
knowledge base.
That said, all eight pioneers attributed a marked importance
to formal qualifications and university education – in the first
instance for their children, often the upcoming generation; and
also when recruiting new employees. All made reference to the
more ‘complex’ and increasingly demanding nature of conducting

business today; and the technicalities and requirements essential
for survival or for taking their business to the next level, including
internationalisation.
With the owner-MDs in their 50s and 60s, children were
employed and involved to varying extents in six of the SMFBs;
in five of them, the children were young and recent graduates. In
3 SMFBs, children of the founder were assisting in management
positions; an opportunity for the next generation to learn the
ropes. Decision-making typically remained centralised, the
founding father’s hand firmly determining all aspects of the
business.
Management is characterised by a flat hierarchical structure,
with direction and control thus nonetheless centralised with the
owner-MD. In larger SMFBs, some having ISO or similar formal
processes in place, a move towards a functional structural set-
up was observed. Across the board, employees were perceived
as key assets, a source of competitive advantage because of
their experience and commitment. Indeed, these pioneers
fully appreciated the dedication and importance of both non-
family employees and managers – referring to them as “like my
children”, “one family” “a gold mine” and their “most important
asset”. Another pioneer noted that his employees are hard-
working and trustworthy, without whose commitment and
‘can do’ attitude “success would not have been possible … loyal
people you can trust 100%”. At another SMFB, the pioneer was
“nurturing” a “team ...working both with their hearts as well
as their brains”. Employee turnover was typically low in these
SMFBs, and commitment typically mutual:
Here, an employee is not just a number but his name is Peter or
Paul … you’d know them by name. So there is that relationship.
You see a sense of responsibility in them ... We were never
presented with the situation where we had to reduce employees
[raised fingers crossed for luck]. … People here ... have been with
us for years and years. You feel they’re part of the company, so
you do your utmost to keep them.
While, for another pioneer, paternalistic relationships were

reinforced, commenting that a relationship with employees is
“like marriage” – where it is important to take “ownership and
establish a sense of belonging”.
My dealings with non-family employees and managers in
various instances of the research evinced the extent of mutual
enthusiasm and belonging:
I love my job and get a bit evangelical about it at times,
especially where [SMFB] is concerned. It really is quite the most
marvellous company. My motto: is ‘Never saying no, always
looking for solutions to a problem’ (Foreign, experienced, non-
family manager dealing with internationalisation).
In another case, a young, Maltese, non-family manager with

an MBA who deals with international sales had this to say:
This year is turning out to be harder [than last year] on the
export side – so I am dedicating a lot of my time to the business
development area. … I have little time outside of work at the
moment… I love my job, so I find the energy.
Scholars note that, among SMFBs, the culture of the firm is

a unique, tacit resource and source of competitive advantage
(Dyer, 1988; Denison et al., 2004). This emanates directly
from ownerMDs who “define the personality of the business”
(Sorenson, 2000, p. 198; also Schein, 1983; Dyer, 1986; Zahra
et al., 2004). In turn, “the culture of the family firm plays an
important role in determining the success of the business beyond
the first generation” (Dyer 1988, p. 37).
No non-family managers were employed at the two ‘small’
SMFBs. Larger SMFBs employed nonfamily departmental
managers. Besides a financial controller or accountant, these
were mainly experienced and dedicated employees who were
promoted internally. Owner-MDs recognised the need for formal
training and education as their SMFBs faced increasingly complex
and competitive environments. Graduate specialists, such as
oenologists and marine biologists, were engaged in production
or technical posts, rather than administrative positions. Other

professionals were recently brought in as experienced outsiders
previously employed in corporate environments. Owner-
MDs did identify gaps in their management ranks, and in an
ideal world would have engaged professionals, but overall did
not necessarily consider employing graduates as the top-most
crucial factor for acquiring new information and knowledge;
even in relation to internationalisation. Instead, international
contacts, relationships and attendance at international fairs
were considered ‘exceedingly important’ (i.e. most important).
Nonetheless, recruiting graduates and engaging external
professionals was still rated highly, and considered as ‘very
important’ or more, for internationalisation by 6 out of the 8
SMFB owner-MDs; and formal education and training were
considered ‘very important’ by 7 out of the 8 SMFB owner-MDs.
Among the larger ‘medium’ SMFBs, four (spanning both
‘novice’ and ‘experienced’ internationalisers) had initiated a
drive towards recruiting graduates and experienced specialists
for managerial roles. Yet, despite this intention and inclination
to professionalise somewhat, overall management and planning
generally remained organic and informal, meetings unstructured
and decisions often taken on the go – decision-making and
direction often firmly in the hands of owner-MDs. Even at one
of the larger SMFBs, where the founder’s incoming graduate
son started professionalizing operations and building a core
management team, the situation (in the persistent shadow of his
father’s aura) was portrayed as follows:
[sometimes] we sit around the table, we discuss and between us
we try to come up with a strategy for moving forward. … that is
the way decisions are taken, and we just plod along.
Recruits in these categories ranged from recent graduates

to seasoned professionals occupying specialist positions, or in
the case of the latter, often managerial roles – sometimes in
newly created organisational management structures. These
roles would have often included positions associated with
new business development, especially international sales and

marketing. Sometimes younger family members were ear-
marked for such positions – while in some other instances
where the critical importance of seasoned specialist outsiders
was recognised, handsomely-paid professionals with a wealth
of insight, experience and extensive contacts, were poached and
brought in.
The founder of a relatively young, fast-internationalising
SMFB credits its exporting success and growth in international
markets, which he claims “exploded”, to his team of engaged,
nonfamily professional management recruits, for whom he paid
handsomely to poach and retain. He calls them “thoroughbreds”;
they were capably engaged in management elsewhere in the
organisation, while complementing his own children and the
family business’ culture. In such cases, a freer rein was granted
and the manager himself, a seasoned foreign professional, was
eventually appointed a director.
The often domineering aura of the founder, ‘boss’ or
‘padrone’; and familiness in itself, shows up in various instances
as a potentially double-edged sword. While exalting the
academic credentials and good foreign degrees of his sons,
now in management positions, an ownerMD quickly reined
himself back and changed tone, retorting in no uncertain terms
that, “no matter what they say, ultimately it’s what I say that
goes”. In another instance, at an SMFB supposedly undergoing
generational transition, it proved very hard to reconcile the
‘outgoing’ founder’s organic gut-instinct opportunism with
his graduate son’s more calculated strategizing. Ultimately,
the situation proved untenable and potentially disruptive to
the SMFB’s continued international growth. In a third case,
in order to stem fragmentation in decision-making and nip
potential disputes among family members in the bud, the
current SMFB owner-managing director had bought out his
brother. In another two SMFBs, it so naturally happened that
the less visionary siblings of the current owner-managing
director naturally assumed alternative supporting roles within
the company, leaving leadership and vision undisputedly in the

hands of the incumbent at the helm. In cases where multiple
siblings felt equally entitled and capable in directing the small
SMFB, without a resolution, this ended up fragmenting the
organisation, splitting the business and threatening its survival.
Social capital
Also evident among the SMFBs under study was how these small
firms could somehow offset their liabilities of smallness and
foreignness; as well as the smallness and isolation of their island
state perch, blurring the traditional notion of human capital. On
the basis of social connections, trust and familiarity – through
leveraging contacts and initially-professional-turned-friendly
relationships, as well as “friends of friends” (Boissevain, 1974),
mostly from their international operations and exposure – these
firms gained knowledge on new processes, technologies and
international markets; insights on new potential international
business opportunities; as well as access and lower transaction
costs on the basis of trust.
These essentially ‘external’ human resources, have been, in
many respects, internalised: social connections, underpinned by
trust and familiarity, became a conduit through which knowledge
and business facilitation flows (Granovetter, 1973). The span
of such connections ranged from established relationships
with long-standing foreign suppliers to important contacts
established at international fairs and expositions.
Interactions and relationships with foreign suppliers are
considered priceless by the SMFBs under study. They give rise
to new internationalisation opportunities, create prospects
for new alliances, and provide insights on new techniques
and technologies, all feeding into new, better and more
internationalisable product development. Other owner-MDs
mentioned that, for knowledge associated with foreign markets
or new product or technology sourcing, their foreign supplier
‘friends’ were their “go to” persons as their first ports of call. In
this way, new leads and personal introductions could be pursued:
stepping-stones to other networks on the basis of legitimacy

accruing from trust and connectedness.
Transcending the business domain, many of these
relationships became trust-based family friendships. In some
other instances, when caught critically short of imported raw
materials required for an important export job – all it took
one SMFB owner-MD was one casual phone call to Pedro, his
“friend” in Spain: half a container loaded with urgently needed
supplies was dispatched Malta’s way as promised and within
24 hrs. All on the basis of a phone call: no document trail or
financial transactions yet effected. This case, resulting in greater
efficiency and lower transaction costs, foregrounds the role of
relationships, and reminds us how it is often social transactions
that precede and form the foundation for sustained financial
transactions; possibly to be repeated multiple times within
the perceived context of mutual value. In other instances, the
prospect of joint ventures and partnering alliances allowed the
SMFBs to punch above their weight and take on new business
opportunities and larger contracts – beyond their individual
capacity capabilities.
In this regard, it was also acknowledged that, closer to
home, recruited experienced professionals also brought their
professional networks and contacts into the business.
Considerations
Competitive, fleet-footed and successful SMEs and SMFBs –

more so those operating in potentially restraining circumstances,
such as those offered by Malta’s small island context – are
distinguished by the traits of flexibility, creative flair, innovation
and an outwardly-driven learning and opportunity-seeking
disposition. This stance is bolstered by fostering and acquiring
talent and human capital inside the firm, and the seeking and
nurturing of social networks outside the firm.
In this regard, the following are some implications and
considerations for SMFB management ensuing from this

research. These observations and recommendations apply
mostly to enhancing internationalisation capacity and capability;
but they are, in many cases, equally relevant to broader strategic
contexts.
(De)centralisation and generational continuity

• Effective transfer of tacit knowledge as well as contacts
and external relationships between generations is
crucial for maintaining competitive advantage across
generations – beyond succession.
• Owners / MDs should actively involve upcoming

generations earlier rather than later. Learning the
ropes (know-how) and key business contacts (know-
who) should be transitioned carefully and sensitively,
preserving trust-based rapport, ensuring continuity,
maintaining goodwill and access to resources as well as
business facilitation across generations – also with long-
standing established networks.
Professionalising management
• The gut-feelings and entrepreneurial orientations of
owners / MDs are significant and essential; but they
need to be balanced with initiatives to professionalise
management, as complexity increases with growth and
internationalisation. Bringing in new expertise, explicit
and tacit knowledge, and contacts will benefit and
strengthen the small firm.
• Care should be taken to preserve each SMFB’s distinct

culture, ethos and reputation: its ‘soul’ and source
of competitive advantage – while professionalising.
Various approaches can be considered concurrently:
(i) Encouraging younger generation family members to

pursue formal degree programmes in order to maintain
a family culture and trust, but accompanied with a
professional outlook.
(ii) Supporting trusted employees with potential to read
for degrees (e.g. evening MBA programmes), providing
win-win opportunities while mitigating risks associated
with unknown and unfamiliar recruits.
(iii) Bringing in professional non-family outsiders, especially
specialists with experience, resulting in new knowledge
perspectives and contacts, reinforcing objectivity but
also adding fresh perspectives to the firm’s operations.
Owners / MDs should carefully hand-pick candidates
and transfer the family culture onto them.
• Such internal professional interaction ‘decentralises’

knowledge stocks and knowledge assimilation,
enhancing SMFBs’ absorptive capacity and the leverage
of its stock of knowledge. Maximising value added from
pooled knowledge and internal transfer. Professionals
could also assist with codifying tacit (often unwritten)
knowledge – where possible.
Sourcing knowledge and social contacts

• Owners / MDs intent on internationalisation should
identify, attend and participate at relevant international
fairs and exhibitions – with due preparation beforehand.
This is a vital source of knowledge, insights onto
opportunities, and a networking venue. Consistent
attendance builds social rapport. Opportunities for
agency support and funding should be sought.
• Contacts and relationships transcend business and

personal spheres, especially in the international domain.
Owners / MDs should tap into this wealth of resources

and social capital with foreign clients, suppliers, agents,
émigrés, embassies, and so on in order to gain new
knowledge, access, introductions and facilitate the
internationalisation of their business.
• SMFBs should fully exploit internet-based technologies for

gaining international exposure and reaching new markets
(also sourcing materials and knowledge). Relatively
inexpensive internet presence mitigates size limitations.
Web-based social-networking sites could generate much
ad hoc exports and potential in conducive contexts.
Tapping into knowledge institutions and centres of excellence

• Owners / MDs should cultivate links and relationships
with universities and research organisations. This
opens us access to external R&D resources, useful for
technological, product and process innovation. Such
links also boost competitiveness in demanding foreign
markets.
• Students are to be encouraged to pursue research

projects and dissertations that provide access to both
explicit knowledge and tailored expertise, and allows
them to engage with a pool of professionals who might,
in return, consider recruiting these students once
their studies are completed. Such opportunities when
students come knocking should be seized.
• Owners / MDs should join international Chambers of

Commerce and establish rapport with TradeMalta and
Malta Enterprise to learn about and utilise available
financial and nonfinancial support mechanisms for their
internationalisation initiatives.
Conclusion
SMEs are the main generators of jobs and value in economies the
world over. This is more so in Malta’s case; where they are playing
a vital role in fuelling our island economy’s diversification and
innovation (Central Bank of Malta, 2018; European Investment
Bank, 2017). These firms have a central role to play in sustaining
our economic growth – and in turn have particular needs and
idiosyncratic circumstances ascribed by the realities within
which they compete.
Business success never comes easy, especially for small
firms. Failure rates are very high, especially in the first years
of operation. Yet, in the colourful story that they weave
across generations from an island archipelago, SMFBs seek
to thrive and survive in increasingly competitive globalised
environments. The magic for managing to do so is often elusive
and defies metrics or traditional measures. Their strength and
success resides substantially in tacit aspects of knowledge and
relational dynamics; and not always within the confines of the
organisation itself. Resourcefully managing and leveraging these
special resources often makes up for the liabilities of foreignness,
newness and smallness. This enables small and mediumsized
family businesses to punch above their weight and to seek
new pastures. Ultimately, what comes across is the immense
possibilities and power of human resourcefulness.
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Public Service and Public
Sector (Part 1):
Joyce Cassar & Myrna Azzopardi
In recent years, there has been a targeted strategy for a renewal

of Malta’s Public Administration, with a view to making it
more efficient and better capable of meeting the aspirations
both of the users of its services and of the employees who
deliver those services. The aim is to bring about a gradual but
steady transformation from the traditional concept of human
resources management to a more tangible, people management
approach, where valuing people is considered fundamental for
they are the main resource of a public service. A successful
and thriving public administration must be people-centric:
committed and accountable to its external customers (citizens)
and treating its internal customers (employees) with the utmost
respect if it expects them to provide an excellent service. The
public administration aims to build upon its efforts to sustain
staff development, in order to equip its employees to deal with
increased and more complex administrative demands. This
development needs to be increasingly competence-based and
value driven.
Succinctly, the Maltese public administration’s priorities
revolve around three main areas: (1) organisational development,
which is the public administration’s internal perspective; (2)

service innovation and delivery, which is the external perspective;
and; (3) good governance. These three areas must constantly
interconnect and refer to each other if there is to be a Service
of Excellence, the maxim currently being used for the public
administration.
This chapter first looks at the legal and regulatory framework
of the Maltese public administration as this is necessary to
understand the context in which any changes could take place.
Next, it briefly looks at the historical development of Maltese
public administration. The chapter then moves on to describe
more recent changes, and especially reforms in recruitment and
people management, monitoring and compliance, employee
well-being, the importance given to quality and standards in
delivery of service, and the holistic development of employees,
including training, development and performance management.
Together, these initiatives allow for long-term planning, maintain
visibility of how resources are utilised, expediting recruitment
and reducing bureaucracy while preserving accountability.
The foundations for the Maltese machinery of executive

government were laid out in the early years of the British colonial
administration; even though a solid public administration did
exist during the time of the Order of St. John, and the British
colonial administration built largely upon this in the 1800s
(Pirotta, 1996). Such institutions as the Monte di Pietà, the
Establishment for the Administration of Public Property, the
University of Studies, the hospitals, the health and quarantine
establishments, the customs, the post office and the law courts
were all reinstated with reference to their operations under the
Order of St. John (Pirotta, 1996).
Hallmarks of the Maltese public administration under British
rule included the introduction of a competitive examination
Public Service and Public Sector (Part 1): Working for the State 365
system for public servants, the introduction of classes and grades,

the root for one of the most significant issues in Maltese public
administration, and an established running of core services such
as education and hospitals before other colonies (Pirotta, 1996).
Between 1813 and 1824, fixed salaries for public officers were
introduced. Furthermore, during this time, an Audit Department
was established.
The contemporary concept of the welfare state came into
effect in 1947 in Malta and so with it compulsory schooling, old
age, sickness benefits and wider health provision. Such initiatives
all meant an even greater presence of the public administration
in everyday life.
A particularly interesting measure was implemented in the late
1950s whereby the Society of Administrative and Executive Civil
Servants (SAECS) lobbied for the protection and constitutional
guarantees against injustices towards public officers (Pirotta &
Warrington, 2001).
During this crucial interim stage before the Independence
Constitution, the notion of politically restricted and politically
free civil service posts was introduced (Warrington, 2008).
Crucially, in 1959, an intense salary and regrading assessment
was undertaken, on the basis that quality public servants would
not be found unless they were offered competitive salary and
promotion packages in comparison with the private industry
(Warrington, 2008), an issue that still very much resounds with
the top management of public administration to this day.
The 1964 Independence Constitution solidified the role of the
Public Service Commission (PSC) as we know it today, even though
its origins appeared in previous Constitutions. Furthermore, the
1964 Constitution legislated on the foundations of the public
administration namely in Article 92 of the Constitution (on
Permanent Secretaries and heads of government departments)
and in Chapter X (‘The Public Service’).
The entirety of the Malta public administration today is
composed of two branches: the Public Service and the Public
Sector. The Public Service consists of employees who serve in
Ministries and Departments. This includes state hospitals, the

police, justice and detention services and schools, as well as the
more general public administration. Ministries are established
through portfolios determined by the Prime Minister and
Departments are the sections falling within Ministries. Some
have entered common discourse such as the Department for
Industrial and Employment Relations (DIER) or the Department
of Value Added Tax (VAT) and they are listed in Schedule II of
the Public Administration Act (PAA) (2019).
The Public Sector consists of different government agencies
(established under the PAA) and/or government entities
(established through their own legal instrument). They operate
through a separate and distinct legal personality, enabling them
to manage their assets more independently, whilst taking into
account directives and guidelines issued (Articles 3, Public
Administration Act, 2019). As at the time of writing, there are
approximately 100 public sector bodies of various types including
agencies (e.g. the Agency for the Welfare of Asylum Seekers:
AWAS), authorities (e.g. the Malta Financial Services Authority:
MFSA), foundations (e.g. the Foundation for Medical Services:
FMS) and commissions (e.g. the Commission for Domestic
Violence) among others. The different compositional structure
of these bodies depends on their nature and operational targets.
As at April 2018, the total number of gainfully occupied
persons in the public service and sector was at 46,884
(including apprentices) (National Statistics Office, 2018). This
is approximately 23% of the total number of gainfully occupied
persons in Malta. The table below gives a breakdown of different
areas in which public administration employees are gainfully
employed.
Table 1: Numbers of public administration employees in different economic

activities (in descending order).
Economic Activity Number of gainfully

occupied individuals
in public service and
public sector
Public administration and defence; compulsory social 14,700

security
Education 11,754
Human health and social work activities 9,840
Administrative and support service activities 2, 891
Transportation and storage 1,932
Water supply, sewerage, waste management and remedia- 1,297

tion activities
Construction 929
Financial and insurance activities 831
Information and communication 643
Arts, entertainment and recreation 594
Agriculture, forestry and fishing 394
Wholesale and retail trade; repair of motor vehicles and 313

motorcycles
Real estate activities 266
Manufacturing 166
Professional, scientific and technical activities 151
Electricity, gas, steam and air conditioning supply 121
Other service activities 62
Total 46,884
Source: National Statistics Office (2018).

Understanding the Public Administration Framework
Like many issues related to the running of a country’s resources, it

all begins with the Constitution (1964). According to Malta’s 1964
Independence Constitution, appointments in the public service
are made by the Prime Minister on the recommendation of the
PSC, an independent body which oversees appointments. The
Constitution allows for certain staffing powers to be delegated
to other levels within the public administration, but delegation
itself can only take place on the Commission’s recommendation
(A 110, Constitution, 1964).
A recent and significant initiative in this context is the
instrument of delegation which, in September 2015, delegated
powers to permanent secretaries, amongst which: (1) to make
appointments to public officers, other than headship positions,
provided that such appointments are made following a
competitive selection process and on the basis of a valid order
of merit; (2) to postpone appointments and; (3) to extend fixed-
term appointments. Consequently, permanent secretaries
became responsible for initiating arrangements to fill vacancies
in authorised staff complements. The PSC takes on the role of
an appellate body in recruitment procedures if an individual
disagrees with a selection procedure on reasonable grounds (A
110(3), Constitution, 1964).
The Public Administration Act (PAA) of 2009 is another
critical piece of legislation. It provides a legal framework for
the overall management of the public administration, including
a Code of Ethics (First Schedule, Public Administration Act,
2009). In 2019, this Act was updated and entirely replaced with
the Public Administration Act (2019).
In this chapter, reference is made to recruitment and people
management of both the public service and public sector which,
at times, may have different rules of procedure. Recruitment in
the public sector is made through the internal processes of the
respective organisation. The checks and balances in this regard
will be described below.
An additional important source of regulation is the Public

Service Management Code (PSMC) which was formalised in
2002. Formerly known as the Establishment Code (or Estacode),
it is the accumulation of directives and regulations issued by the
Office of the Prime Minister as would apply to the public service.
Its contents are regularly updated to reflect current management
guidelines and policies within the public administration.
Recent Historical Developments: The Public Service

Reform Commission (PSRC)
To better understand recent developments in Malta’s public

administration, a useful point of departure is 1989, when the
Prime Minister appointed the PSRC to thoroughly review the
workings of the local public administration. By its own admission,
the Commission’s terms of reference were very broad: “to examine
the organisation of the public service” (PSRC, 1989, p. i). The PSRC
subsequently made its recommendations on the composition
and operation of the public service. This Commission produced
extensive conclusions which completely changed the way the
public administration operated in crucial ways.
Five significant innovations can be singled out as a
consequence of this far-reaching reform exercise: First, was
the system of three-year, renewable contractual appointments
for senior management positions, which persists to this day.
The effect was to emphasise responsibility and accountability
of persons occupying headship and analogous positions in
certain sectoral classes. Second, was the shifting of emphasis on
actual performance rather than relying simply on the criterion
of seniority for promotions. Third, was the whittling down of
approximately 100 different salary scales to a 20-scale salary
structure, and which is still upheld. Fourth, is the setting up
of a code of ethics which was eventually incorporated into the
PAA. And fifth, is the new focus on the training and continuous
development of public officers.
In 1990, following the recommendations of the PSRC (1989, p.

30), the Management Personnel Office, which oversaw industrial
relations, conditions of employment and staffing, as well as the
Staff Development Organisation targeting staff training and
development, were established as separate departments. Prior to
this, these functions, among others, all fell under the remit of the so-
called Establishments Division. (Warrington, 1997, p. 123). In 2010,
the Management Personnel Office was converted to the Public
Administration Human Resources Office (PAHRO) and, in 2016, it
was revamped to become the People & Standards Division (P&SD).
While there is a clear continuation of activities in each of
these manifestations, the change in name is a reflection of a
change in times and priorities. The Management Personnel
Office operated within the confines of a framework that really
only had the Constitution as a legal point of reference; PAHRO
was a reflection of the new chapter that was being written
with the coming into force of the PAA. The PAA, for example,
delineated more clearly the powers of permanent secretaries
beyond what is mentioned in the Constitution and legalised the
code of ethics. Therefore, an office was necessary to coordinate
the resulting new changes.
The P&SD, on the other hand, focuses on the shift in
orientation, now that procedures and structures had long been
established. The P&SD was set up to reinforce the idea that
people are at the heart of public administration. These people
need to look and aspire to high standards when engaging in their
work; but they, in turn, need to be appreciated and their skills
cultivated in order to succeed.
Mirroring the evolution within the principal human resource
management central offices was the development of the training
branch – from the Staff Development Organisation (SDO) in
1990, as proposed by the PSRC, to the Centre for Development,
Research and Training (CDRT) in 2007, and the Institute for
the Public Services (IPS) since 2016. This unit has been the
main thrust for the training of employees within the public
administration, at all levels.
There are some recurring themes dating back from 1989

since underlying challenges of public administration persist.
However, the extent and manner of implementation has varied
at each stage, each time a reflection of the context, ideas and
individual champions of the moment. To an extent, the recent
developments are a natural progression of historical legacy,
definitely within the context of the PAA. In some aspects, on the
other hand, they suggest a shift away from the past.
The Shift to People Management and Corporate Identity
In time, it was felt that the entire public administration

necessitated a dynamic and cultural shift to meet the challenges
that were posed by an evolving and expanding economic reality
(Euler Hermes, 2018). Malta’s growing economy requires a
public administration which excels in the provision of services at
both national and international levels (International Monetary
Fund, 2017).
The vision was to reform a public administration which had
garnered the reputation of being bureaucratic and not people-
centric (Cassar & Bezzina, 2005). Bold initiatives were therefore
necessary if the strategy to become a service focusing on the
needs of both citizens and employees was to succeed. No amount
of high level branding would be successful in achieving the
desired reform, without a daring new direction that addressed
the matter at its core. Achieving the set goal meant assessing,
challenging and transforming the existing ingrained corporate
culture, horizontally and vertically (Cameron & Quinn, 2011).
The view that would lead to a new strategy was based on the
belief that people are central and unique, different than all other
resources. This formed the basis for the creation of the P&SD
in September 2016. It was conceptually established so that the
system would move away from the conventional view of human
resources, which pertained to a purely personnel function,
to one focused on looking at people holistically. The idea was
to bring together people and standards: employees providing

excellent services to citizens (external customers) while they
themselves have their needs met by the public administration
which employs them (internal customers) (Stirk & Sanderson,
2012).
But what does people management mean? It signifies a wider
scope of valuing people holistically. As a result of training and
development, support and care for their well-being, as well as
empowerment, the performance of employees is enhanced.
Furthermore, people management also encompasses the issue
of accountability and responsibility. For employees to feel
empowered, they need an enhanced sense of responsibility and
commitment, and a growth in decision-making capability.
People feel accountable if a system of effective performance
management is in place. In this vein, what cannot be measured
often cannot be managed and subsequently improved (Drucker,
2011); this means that one cannot know whether or not there is
success unless that success is defined and tracked. This requires
a good communications system, clear objective setting, skills
matching and ownership of tasks assigned. The formation of clear
benchmarks and standards also improves how employees relate
to the revamped corporate image that the public administration
has embarked upon.
The value of trust is hard to quantify and hence may often
be sidelined. In one study, Homan Blanchard, Miller, Zigarmi
and Houson (2017) found that employees who trust their leaders
perform better and are less likely to leave the organisation.
The need for trust in the workplace is a fundamental building
block that is a prerequisite for cultural reform in the public
administration to stand any chance of succeeding. If employees
were to start or improve trusting the system, they would first
need to trust their managers, directors and leaders. Therefore
dedicated training such as the public management toolkit was
developed. More about this below.
Corporate brand identity management has been
conceptualised by Coleman, de Chernatony and Christodoulides
(2011) as a multidimensional construct comprising of five

dimensions: (1) employee and client focus; (2) corporate visual
identity; (3) brand personality; (4) consistent communications;
and (5) human resource initiatives. The systematic and effective
management of the corporate identity, with its potential to
increase the commitment of the public officers, would increase
job satisfaction and improve employees’ performance (Buil,
Catalán & Martínez, 2016).
Such theories were manifested in a four pillar model for a
service of excellence, launched by the Office of the Principal
Permanent Secretary in 2016. The four pillars refer to voice,
design, delivery and accountability.
The flow of the four pillar model for a quality service delivery
starts with ‘voice’, signifying openness to new ideas, concepts,
feedback and the needs of customers (both internal and
external). One example is the IDEA initiative, launched in 2014.
Here, public service employees are encouraged to put forward
ideas and suggestions for the improvement of the public service.
Employees who forward ideas which are eventually approved for
implementation are presented with a certificate of recognition.
The next pillar is ‘design’: if information gathered by listening
to customers, stakeholders and employees is not addressed
and improved upon, it is futile and disenchanting. Therefore,
there is a careful and studied design of processes, policies and
services which better meet the expectations and requirements
of customers. One manifestation can be seen in the delegation
of authority which empowers ministries to better plan their own
resources, while ensuring compliance to regulations.
‘Delivery’ is the third pillar: it focuses on established
timeframes and setting benchmarks. Throughout recent years,
this was done through a series of business process mapping and
re-engineering exercises, as well as establishing key performance
indicators (KPIs) in targeted areas.
The fourth and final pillar is ‘accountability’. It is the
undercurrent of public administration work and its ultimate
objective. Good governance requires quantifiable tools that
could assess the level of success by monitoring delivery and

compliance. Through the P&SD, customer services started
being monitored in relation to their adherence to established
benchmarks in quality standards. A mystery shopping project
was rolled out progressively across the public administration
since 2016. Compliance checks were carried out to assess
adherence to regulations for delegated authority, as described in
detail below.
A service of excellence became the driving idea of this
cultural shift. It required that those working within the public
administration felt they were valued, and felt empowered
by the goals of the organisation they participated in. This
was underpinned by an increased focus on specific values,
reinforcing those already found in the Code of Ethics within the
Public Administration Act. Therefore, this new direction was
committed to excellence, effective helpfulness at all times, and
fairness of service performed with due diligence, responsibility
and integrity. The vision, mission and value statements that
greet visitors when they enter the offices of the P&SD reflect
the overarching principles set by the administration. However,
implementing the above on a practical level required specific
targets with honed in deliverables. Otherwise, the planned
change would not be felt and would simply be empty words
written on a wall.
When the P&SD was established in 2016, its task was to
translate strategic direction into operational and tactical plans
specifically relating to people management. These would
include the establishment of effective structures which would
ensure space for growth in career development. Another goal
was ensuring that holistic planning was not an option but a
requirement. Last but not least, the P&SD is charged with
coordinating the overall public administration staff complement
to be both practical and financially sustainable. The P&SD was
tasked with addressing the development and training of the
existing employees as well as promoting an enhanced public
administration, making it more attractive and more competitive
in the labour market, especially for those seeking their first

employment.
The P&SD works in close coordination with the Office of
the Principal Permanent Secretary. In a move which conveyed
commitment to people at the centre of a service of excellence, the
division was promoted to one headed by a Permanent Secretary.
In collaboration with line ministries as strategic partners, and
through the instrument of delegation of authority, the P&SD
supports and ensures that the Ministries strive for the fulfilment
of holistic people management policies and management systems,
their implementation, monitoring and constant re-evaluation.
In overseeing standards and processes, the P&SD encompasses
the following key components: resourcing and compliance,
research and personnel systems, people support and well-being,
quality and standards, training and development, discipline and
industrial relations. Therefore, there is now a more cohesive
approach to strategic people management through a number of
incremental steps, which will be described below.
The Well-being and Support of the People

In 1999, the first steps at work-life balance measures were taken,
with the introduction of reduced working hours (Management
Personnel Office, 1999). The need for such measures was felt
more strongly and the Establishments Code (Estacode) was
published. Furthermore, there were a number of circulars and
policies which were not cohesively gathered in one document
and so did not allow for public employees to have a clear reference
point when querying conditions of service. And so, the Public
Service Management Code (PSMC) consolidated and simplified
these guidelines in 2002. This document became the definitive
guide for any public official, and with good reason.
In its current form, the PSMC follows a progressive trajectory
from initial engagement, attendance and remuneration, leave
entitlement, work-life balance measures and employee well-
being. The final section is on conduct and discipline. The PSMC
is applicable to all public service officers and (where indicated)
to public sector employees. A particular example in this regard is

the entire chapter related to Work-Life Balance Measures. In the
spirit of both valuing employees and accountability, it lays out
both rights and obligations. The PSMC gives public employees
clear and simple guidelines on their duties, entitlements and
assistance in times of distress (both personal and professional).
A hallmark for the public administration is the Employee
Support Programme (ESP) which began in 2010. It raises
awareness and provides support on psycho-social or disability
issues. The programme is designed to deal with a broad range
of difficulties, including work-related stress, mental health
difficulties, bereavement and terminal illness, addictive
behaviours and disability issues. Employees may access the service
by requesting an appointment. Appointments can be scheduled
both during and after normal working hours. Confidentiality is
pivotal in this service as it also seeks to create a high trust level,
where the employees are not afraid or feel shamed if they need
such assistance and support.
The superior’s permission is not required to contact the unit.
However, in order to attend appointments during working hours,
the prior approval of the respective Director is required but
employees do not need to disclose the reason for accessing the ESP.
On a related note, in November 2017, a ‘one stop shop’ for public
officers was established whereby public officers may lodge requests
for assistance on any matter related to their employment. The
initiative was a follow-up to the Grievances Units set up in 2014
which investigated alleged injustices against public officers prior to
2014. The one stop shop was a move towards providing a permanent
desk for this need for public officers who may feel they have been
aggrieved or treated unfairly (OPM Circular No 24/2017, 2017).
Training and Development

Apart from the initiatives mentioned above, there have been a
number of focused changes which affect the holistic and more
personal development of public employees.
In August 2016, a new performance appraisal system was

launched that takes into consideration not only traditional
work plans but also gives attention to personal attributes
(both interpersonal and those that contribute to organisational
development); motivation and initiatives above and beyond
the call of duty and; training and career aspirations. It was felt
that the prior performance review system (the Performance
Management Programme) could be improved upon if it took
into account the competencies and potential of employees, as
well as honing in on its potential as an effective management tool
from the supervisor’s point of view (Bonnici, 2010). This reflects
the thinking that an appraisal system goes beyond looking at the
employee as merely a human resource delivering objectives. The
performance appraisal system, if used properly, can motivate and
challenge employees to grow, evaluating their abilities and skills
to design training and development to increase their potential.
Clear outcomes need to be agreed upon by both the employee
and supervisor and subsequently endorsed so that employees
feel empowered to have a say in how they feel at, and about, their
workplace.
The IPS is the dedicated central training and development
organ of the Malta public administration, providing training to
public employees at all levels, from industrial and clerical staff
to top management. The Institute consolidates and coordinates
training needs throughout the public service, and administers
sponsorships for more extensive and specialised training
programmes, ranging from Certificate to Masters level. The IPS
organises a wide range of programmes, including management
training, governance and policy, public finance and induction
courses for newly appointed public officers. It also provides
ministry-specific training and is now branching out into job
placements and shadowing abroad.
Coordinating these efforts calls for a strategic approach which
is tied to the current needs and goals of the public administration
as a whole. This is why IPS consults with relevant stakeholders for
the identification of training needs. These include: line managers
working in people management at ministries and departments

who can provide feedback ‘on the ground’; heads of departments
who may communicate sector-specific goals (whether short
or long term); the P&SD which has an overview of the current
status of people management needs in public administration; and
individual participants themselves through consistent feedback
on training delivery.
For the first time ever, in 2016, a memorandum of understanding
was agreed upon between the Public Administration, the
University of Malta (UM) and the Malta College of Arts,
Science and Technology (MCAST) to bring together the public
administration, as a key and largest employer in Malta, and
these academic institutions to address skill needs and design
bespoke courses that are required for public employees. This
creates a mutually beneficial relationship between academia and
the public administration.
The IPS develops and oversees programme delivery. Together
with the IPS, academic institutions review the programme
content in light of ongoing developments in the field of public
administration and other more technical fields, as well as
identifying research needs. This collaborative process refers
back to quality assurance processes and the exigencies of the
public administration.
The IPS seeks to update its annual prospectus, and will be
doing so through an interactive website, in order to accurately
reflect current training needs within public administration.
Moreover, online courses and lecture capture facilities are
in development to address the demand for training. The
IPS therefore turns to key sources such as the ‘HR plans’
(described below), employee performance appraisals which
identify individual training needs, requirements in specific
career streams and such uniquely insightful exercises such as
mystery shopping (also elaborated on below). Together with
personal feedback from stakeholders mentioned above, this
offers a comprehensive and data-backed approach to designing
training programmes.
Of special note is the public management toolkit, especially

designed for those in managerial positions. Current or
aspiring leaders need a multidisciplinary understanding
of communication, decision-making, service delivery and
organisational structure. The Toolkit has a number of modules
which address varied themes, ranging from administrative
effectiveness, technical competency, analytical abilities to the
personal development of its participants. Examples include such
modules as strategic change, interpersonal skills and managing a
diverse workforce. Only through a kaleidoscopic education such
as this can leaders understand the journey towards a Service of
Excellence.
The rationale behind the IPS is that training and development
are an integral part of the day to day work life. Targeted training
develops employee skills and insights to enable them to perform
better in their jobs, obtaining relevant qualifications and boosting
their career prospects as aspirations.
Quality and Standards

Comprehensively satisfied employees whose rights and interests
are protected are naturally more content at the workplace.
Consequently, they provide a better service. The ‘service of
excellence’ theme throughout the public administration now
serves as a map for goals and a clear reference point during
compliance checks. This did not happen overnight but via several
incremental steps which have been taken in recent years.
After the establishment of the four pillars, Directive 4.1
was issued by the office of the Principal Permanent Secretary
in 2017 laying out the standards for a service of excellence. The
accountability pillar, in particular, drives the Directive’s rules
and enforcement grounds by mentioning “honesty and integrity”
and ensures “loyalty towards customers.” The principles behind
the service of excellence are “efficiency, fairness, impartiality and
integrity”.
The Directive speaks of standards for communication in
writing; telephone communications; social media commentary;
appointments, managing queues and reception areas; providing

information and addressing complaints; and services delivered
online (Directive 4.1, 2017). Public officials should remain
courteous and polite at all times and should forward calls as
necessary or take relevant details for the query to be followed
up. Directive 8.1 (2017) extends the same expediency to internal
customers to emphasise that should public officers demonstrate a
service of excellence internally or are recipients of such a service,
then treating external clients in the same manner should become
second nature. Therefore, these Directives sought to provide a
concrete and practical guide to the definition of quality, in order to
counter the subjective interpretation that such a term may have.
In 2016, ministries were approached to develop their own
standards of procedure by identifying client-facing services,
creating a customer profile and identifying their optimal
procedures. The process was done slowly but surely so that public
service employees would not feel they are immediately being
judged without proper training and guidance. Concurrently,
a strong education campaign was launched on the service
of excellence as a whole. This includes: Directive 4.1, the four
pillars, the ten determinants of service quality, standards of
procedure and any subsequent monitoring. This included a
specialised training course at the Institute for Public Services for
both internal employees and new recruits.
Once the foundations had been laid, more targeted mechanisms
were used over the course of 2017 and 2018. These included: (1)
departmental quality (customer care) assessments, targeted at
venues within the public administration which deal with a heavy
influx of external clients; (2) the mystery shopping exercise; (3)
a wide range of technological tools, such as the ‘rate the public
service’ mobile application and tablets available for customers to
provide their feedback; and (4) compliance checks, both in the
public service and public sector. Each of these four mechanisms is
reviewed below. They have culminated in the Quality Label Award
which acknowledges those departments or entities delivering a
service of excellence, be they external or internal.
Departmental quality (customer care) assessments

Departmental quality (customer care) assessments are designed
to assess non-technical skills. For example, during such
assessments, health service providers are not examined on
their technical medical skills but rather on how they treat and
relate with their clients. Each report includes recommendations
which are given a time limit to implement and then followed
up to ensure accountability. Each assessment also gives a rating
along a 5-point scale, ranging from ‘excellent’ to ‘not acceptable
(improvement needed with urgency’).
Mystery shopping
The mystery shopping exercise was developed as a follow-up to
the previous mechanism. Mystery shoppers are experts in the
field of the service being carried out; they conduct visits using the
services as though they are a client, either by telephone, email or
physical visits. Subsequently, they also make recommendations
for improvement in the service and training for the respective
employees.
The recommendations stage in both these mechanisms is
a process of open dialogue rather than simply a case of ‘orders
from above’. Both mechanisms use the SERVQUAL research tool
which contemplates five service quality dimensions: reliability;
responsiveness; assurance; empathy; and tangibles (Parasuraman,
Zeithaml & Berry, 1988). The difference between departmental
quality (customer care) assessments and mystery shopping
exercises are that the former are carried out by public officials
responsible within the P&SD while the latter are conducted by
engaged service providers who can offer an outsider’s perspective
and reaction on the services being provided.
Technological tools
The third mechanism involves a set of technological tools for
rating the level of quality in services provided. These include
a number of tablets stationed in key locations for clients to
immediately provide feedback. The ‘rate the public service’
mobile application is also available and it sends results to

dedicated officers who follow up and flag low ratings.
Compliance checks
Finally, there are the compliance checks which provide feedback
on administrative procedures related to people management
carried out in ministries. The compliance checks are conducted
by dedicated officers at P&SD.
These four mechanisms eventually lead to business process
analyses and re-engineering, if necessary, to regularly streamline
services being provided and make them more efficient. Issues
which increase bureaucracy or create bottlenecks are thus
identified and smoothed out within reasonable timeframes.
Responsibility through delegation

Decentralisation has become an increasingly pronounced
objective due to the ever-growing scope of public administration.
Such delegated authority is based on an increased sense of
responsibility, accountability, mutual respect and collaboration
across all levels of the chain of command. In the process of
delegating authority in the areas of recruitment, established
procedures and regulations, training and monitoring were
required for ensuring good governance practices at ministerial
levels. It was also equally crucial that the central administration
had clearly articulated strategies and plans, so that both ends
understood the end goals and how to achieve and maintain them.
One of the first issues to be tackled was the delegation of
authority of the public sector. The reason behind this was that the
public sector could not be expected to be responsible if it lacked
autonomy. This was achieved in January 2014 through Directive
7 issued by the Office of the Principal Permanent Secretary. The
aim was to better consolidate availability of skilled persons and
matching them to the respective organisational requirements.
The first step in any newly instituted public sector body
is to seek approval from the Ministry of Finance for monies
related to personnel and from the Industrial Relations Unit
within the P&SD for the grading and salary structure, that is,
the composition of the personnel within the respective public
sector body. This is coordinated by the Permanent Secretary of
the Ministry responsible for the Public Sector entity concerned.
Once these two key components are in hand, the public sector
body is no longer required to seek P&SD’s approval when
recruiting in a position which already exists within these
structures and approvals. However, the creation of new positions
and an increase in headcount need to be referred back to the
respective Permanent Secretary for consultation and approval.
Final approval, in this respect, vests with the coordinating
committee whose functions will be explained in detail below.
In September 2015, Directive 9 extended the delegation of
authority to conduct selection processes and make appointments
to the public service; that is, to the main ministries and line
departments. This stemmed from the corresponding instrument
of delegation by the Prime Minister in accordance with Article
110(1) of the Constitution, explained above.
The main aim behind these changes was to reduce bureaucracy
when establishing selection criteria, issuing selection results in
recruitment processes, making and postponing appointments
and renewing most fixed-term appointments to positions. The
Permanent Secretaries of Ministries were empowered with
these tasks so that they may take ownership of their respective
organisation.
However, it was Directive 10.1 (2017) which provided
people management professionals an opportunity to truly prove
themselves. Directive 10.1 deals with the submission and approval
of business and human resources plans (referred to internally
as ‘HR plans’): this is a crucial tool which communicates the
people management needs of each unit for a strategic approach
to resourcing.
The entire process is activated once there is the financial
allocation for ‘personal emoluments’ as presented in the
Government’s annual budget. HR plans allow for a comprehensive
view of resources found within any given organisation and when
examined side by side for the public administration in general.

This allows for thorough planning and efficient prioritisation
of resources instead of a piecemeal approach which is not
streamlined to the rest of the public administration. HR plans
are therefore used as an administrative and visual tool for each
individual ministry to communicate its complex set-ups to the
coordinating committee (explained below). It is a projection
for the respective year which can change due to exigencies and
circumstances, after required approvals.
HR plans offer as comprehensive a view as possible of the entire
staff complement (staff already in place), proposed recruitment,
promotions, replacements, progressions, envisaged renewal
of contracts, allowances, bonuses and other perks, headships,
assistant directorships, as well as holders of political office,
private secretariats, policy consultants, advisors and persons/
positions of trust carrying out technical/ancillary functions.
Towards improved accountability

A key functionary in the directives mentioned above is the coordinating
committee, established under Directive 10.1. This committee is led
by the P&SD and the Ministry for Finance. Its key functions are the
scrutiny and approval of HR plans in light of budgetary allocations and
capacity requirements for the efficient implementation of ministerial
and departmental projects. In fact, during consultations between the
coordinating committee and ministerial officials on the approval of
HR plans, reference is frequently made to new project allocations or
key performance indicators allocated to ministries in order for the
latter to justify the need for more specialised individuals, whose skills
may better address the aims.
The committee’s approval is especially important in the
number of instances when: (1) requests for the creation of
new positions are made; (2) vacancies are created in excess of
approvals previously confirmed in earlier HR plans; and (3)
capacity building needs to match new projects, which may
require ministries to deviate from their approved HR plan, and
would require specific justifications.
The committee uses HR plans to identify efficient prioritisation

of resources across the entire public service. Therefore, no single
HR plan can be taken on its own. In fact, Article 3(e) of the Fiscal
Responsibility Act (2014) lays out the principle of efficiency
“whereby the Government’s fiscal and budgetary policies shall
be aimed at achieving an efficient use of scarce public resources
requiring that economic efficiency is considered.” This principle,
in practice, necessitates a dynamic approach to the ever-changing
circumstances within the public service.
Conclusion
A satisfied and well-treated workforce gives more results, higher

productivity and better services to clients. This is the basis for
a model that empowers and motivates people, for tools that
increase accountability, for safeguards to nurture well-being. The
measures taken had to mimic building blocks. It is not easy to
change the motivation and rationale of such a large organisation.
However, it began with a few key ideas, such as the desire to see
tangible manifestations of valuing people, supporting their well-
being as well as their productivity. Thus the ideas of strategic
people management, coupled with the notion of the Malta public
administration as a performing organisation, began to take hold
and form the foundations of decisions taken across the board.
Inevitably, there were challenges, mostly cultural, such as a
resistance to change and organisational cynicism and indifference.
Some solace can be found in the fact that, when it comes to the
public administration, resistance to change has its own historical
roots (Pirotta, 1996); but, most importantly, changes have been
carried out regardless. These are being systematically addressed
through consistent training and branding as well as the clear
and frequent inculcation and communication of common
values such as integrity and quality. Management was further
responsibilised so that the implementation of these values
could be equally shared and not felt to be a distant talking point
discussed only at the top levels. This is why there have been such
initiatives as the simplification of bureaucracy, with a total of
500 such measures in 2016. Such measures include the launch of
mobile apps for government services and www.servizz.gov which
facilitates access to government services, whether through its
physical locations, telephone or through its online platforms
(“500 simplification measures”, 2017).
To succeed in its strategy, the public administration needs
employees who are ready to meet its pace, fresh outlook and
modern methods that address the expectations of a service
delivery that aspires to meet excellence. From its end, the public
administration now boasts offering dynamic career prospects
which allow both for specialisation and a broader, more all-
rounded range which meet the expectations of the respective
employee as well as the exigencies of the service itself. The
perception that working for the Public Administration is
sterile and unfulfilling is being eradicated. In its vastness, the
public administration provides opportunities for growth and
modern advancement. There are opportunities for any area of
specialisation, including those geared to meet the needs of the
ever-expanding economy. The classes or employees range from
those with science and technology, education, architecture
and engineering, medicine, ICT, accounts and finance, project
management, economics; and do not exclude those with
backgrounds in the social studies, the humanities or the liberal
arts, among many others.
The public administration is an employer that invests heavily
in its employees, involves them in decision-making, creates
career streams and opportunities for their advancement,
sponsors their further studies and takes a more holistic approach
to people management. Furthermore, it is an employer that
firmly and actively believes in the well-being of its workforce.
It is at the forefront for family-friendly measures within local
organisations and strives to be a model employer in this regard.
The overall goal continues to be the continuous modernisation
of the public administration together with promoting public
employees as top contributors to innovation. This is an ongoing

and comprehensive project. It calls for measures for timely
decision-making, simplified and more user-friendly processes,
and strategically planned recruitment in light of operational
requirements. The Malta public administration strives to show its
accountability to its external customers through sector-specific
high quality service delivery, and to its internal customers by
putting people at the heart of public administration. Its many
clients and its many employees deserve no less than a service of
excellence.
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Public Service and Public
Sector (Part 2):
Pay Negotiation
Mario Grixti
The core activity of industrial relations is negotiating pay. For

the absolute majority of employees, earnings are on the top of
the agenda when evaluating a job. Goldthrope (1968) coined
the term ‘instrumental orientation’ to capture a particular
category of employees whose main and exclusive interest is the
financial remuneration that results from their work. As a general
perspective, pay may exert the major influence in recruiting and
retaining employees. Goldthrope (1968) also identified two other
categories of employees; those with a bureaucratic orientation,
who are mainly motivated by career and promotion prospects;
and those with a solidaristic orientation, who are mainly driven
by intrinsic job satisfaction and are emotionally attached to
their work. This third segment is the dream workforce of every
employer.
Like any other organisation, the Malta Public Administration
(hereafter MPA) has to face the onerous task of establishing the
pay packages of all its employees. The task is rendered more
peculiar by both the sheer size and diversity of its workforce,
as well as by the strong negotiating power of trade unions,
practically across all grades. Cassar and Azzopardi (2019)
have already provided important insights about the evolution,

dynamism and complexity of the public administration in
Chapter 16 of this book. It is not the intention of the author
to repeat those details. Rather, this chapter critically evaluates
one very important aspect of the MPA, namely pay negotiaton.
Given the sector’s size and complexity, this topic certainly
warrants a full chapter. The dynamics which exert pressure
on the negotiation process of the pay packages in the MPA is
particularly unique given that some 26.2% of the total number
of gainfully occupied employees (excluding the self-employed)
in Malta work with the MPA (National Statistics Office, 2018).
In order to facilitate this analysis, this chapter will, without
repeating elements discussed in Chapter 16: portray the
characteristics of the MPA, particularly the difference between
the public service and the public sector; and it will draw on the
major milestones as regards the developments of a centralised
unit conducting industrial relations in the MPA. This chapter
will also foreground the pressures which trade unions in Malta
have to deal with during the negotiation process; in particular,
the competitive race for membership of the two general unions,
which are keen to attract and retain members by promising that
they can harvest better gains. Finally, the chapter will offer an
evaluation of the extent to which the gross domestic product of
the Maltese economy influences pay packages within the MPA.
With the Maltese economy doing exceptionally well in
recent years, it exerts pressure to increase remuneration so that
all will benefit from the declared economic growth. This issue
obliges a consideration of the extent to which pay increases are
tied to productive increases; or are a mere increase of money
to communicate, in a tangible manner, the good feel factor
emanating from economic growth. This issue will be explored by
adopting an international perspective and looking at the extent
to which pay packages in the public administrations of European
Union member states are influenced and/or determined by the
overall economic climate of the respective country, rather than
by productive increases in output.
Public Service and Public Sector (II): Pay Negotiation 393
The author is directly involved in the negotiation process

at MPA; and so caution has been exercised to safeguard
confidentiality and keep in check any inevitable insider bias.
Furthermore, the author declares that arguments presented in
this paper are not to be interpreted as an official position but
are being presented in a personal capacity, and for academic
purposes. The methodology adopted is primarily that of
critical reflections on industrial relations in Maltese public
administration. Reference is made to two official but unpublished
documents and studies (Joint Negotiating Team (JNT), 2009;
MFEI, 2012) since the author was a member of their authoring
teams. Also interviewed were two retired senior union officials
who have provided consultancy and advice on industrial relations
matters to the public administration after they retired from trade
union service. A similar set of questions were also presented to
a retired, senior civil servant. These three resource persons were
asked whether: (1) the MPA is reactive to claims by trade unions,
rather than proactive; (2) negotiations on pay packages in the
MPA are more time-consuming than those in the private sector;
and (3) the extent to which remuneration in MPA is: justified;
sustainable; offers value for money to the taxpayer; aligns with
a return in responsibilities and productivity; and sensitive to
labour market trends.
Characteristics of the Maltese Public Administration
Key differences have already been highlighted by Cassar and

Azzopardi (see Chapter 16) and will only be noted here for the
purpose of clarity. Additional qualities will be mentioned in the
context of the topic under discussion, namely remunerations,
salaries and negotiations.
‘Public administration’ means the Government of Malta,
including its ministries and departments, and the agencies,
government entities, commissions and boards referred to in the
Public Administration Act (2009).
MPA is made up of two major sectors, the public service and

the public sector. The public service refers to those grades and
nomenclatures which are mainly regulated and captured by the
annual budget document and which covers public officers whose
contract of employment is sanctioned by the Public Service
Commission and referred to in Article 124 of the Constitution
of Malta.
On the other hand, the public sector involves public units
such as corporations, agencies and entities which are considered
as having a distinct legal personality. The employment conditions
of their employees and their industrial relations are regulated by
Chapter 452 of the Laws of Malta (Employment and Industrial
Relations Act, 2002). The public sector also falls within the
portfolio of respective ministries and is also subject to provisions,
in force from time to time, regulating the remuneration package
of employees.
The Public Service

The public service is more structured and perhaps more rigid
when compared to the public sector. In the public service, the
current remuneration template traces its origin to the Public
Service Reform Commission (PSRC, 1989). The PSRC established
the following four broad principles, and they remain in force:
(1) grades are established in correspondence with broad levels
of responsibility and competence represented by education and
training; (2) movement from a lower to a higher category is
restricted by stiff promotion hurdles; (3) career and non-career
employees are classified in one system; and (4) grading structures
ensure order, equity and consistency.
Agreements in the Public Service

In the Public Service, one must distinguish between a) the
collective agreement for employees in the public service and b)
sectoral agreements.
The Collective Agreement for Employees in the Public Service

The Maltese Public Service employees started being governed
by a collective agreement in the early 1990s, during the wave of
administrative reforms taking place at the time (Aquilina, 2017).
The current collective agreement covers around 30,000
public officers. It confirms the 20 salary scales and stipulates
that it remains in force for a record period of eight (8) years:
from 1st January 2017 to 31st December 2024. Besides giving
medium-term stability and forecasting, its expiry date – which
implies entering into tortuous negotiations for a new collective
agreement – will, almost certainly, not coincide with an election
period. This will relieve the administration from unwarranted
pressures.
Table 1 reproduces the salary scales for 2018, as locked by the
2017-2024 collective agreement. Note that this salary structure
also serves as a guiding principle and benchmark for the pay
packages negotiated in the public sector.
Table 1 indicates that the 20 salary scales are built on a
principle of relativity, with a ratio of 1:4 between the highest and
lowest paid.
The current collective agreement has a landmark clause which
introduces a time period for the sectoral agreement. Prior to the
introduction of this clause, the only sectoral agreement which
had a sunset clause was that between the Medical Association
of Malta and the Government of Malta regulating the medical
class:
Table 1: Public Service Salary Scales

(Collective Agreement for Employees in the Public Service, 2017).
Public Service Salary Scales for 2018
Scale Step 1 Step 2 Step 3 Step 4 Step 5 Step 6 Step 7 Increase
1 44782 711
2 41352 718
3 37920 726
4 34504 731
5 26770 27411 28051 28692 29333 29973 30614 750
6 25034 25630 26227 26823 27419 28016 28612 726
7 23431 23962 24493 25024 25556 26087 26618 703
8 21951 22438 22925 23412 23898 24385 24872 675
9 20590 21037 21485 21932 22379 22827 23274 644
10 19331 19739 20146 20554 20962 21369 21777 610
11 18153 18528 18903 19278 19654 20029 20404 573
12 17026 17380 17734 18088 18442 18796 19150 534
13 15955 16290 16626 16961 17297 17632 17968 494
14 14928 15245 15562 15879 16195 16512 16829 452
15 13970 14268 14566 14864 15162 15460 15758 409
16 13156 13419 13682 13945 14208 14471 14734 365
17 12310 12554 12798 13042 13286 13530 13774 320
18 11500 11722 11944 12166 12388 12610 12832 274
19 10740 10949 11158 11367 11576 11785 11994 226
20 10007 10205 10403 10601 10799 10997 11195 178
The same agreement reaffirms that this document signed

by Government and seven trade unions, representing the large
majority of public service employees, establishes a cardinal
principle enshrined by clause 16.1 of this Agreement:
The Administration and the Unions agree that the established
benchmarks shall not be disturbed. The salary structures in
the current Public Service Classification Agreements shall
continue to respect these benchmarks (Collective Agreement
for Employees in the Public Service, 2017, Clause 16.1).
Two particular aspects of the negotiating process of this
collective agreement are worth highlighting. First, this is by far

the only collective agreement in Malta negotiated simultaneously
with seven trade unions, and has been the case since 1996. One
must appreciate the dynamics of such negotiations. The official
side may appear to be negotiating with one body, made up of
seven unions; but, during the negotiation process, one can notice
that there were also negotiations going on between the unions
themselves to come to some consensus. Second, the seven trade
unions enjoy a very high union density of employees in the
public service; unlike the private sector, where only some 30% of
employees are trade union members (Baldacchino & Gatt, 2010;
Debono & Baldacchino, 2019).
All public service employees, in some way or another, have to
fit in the 20 salary scales. This means that the neurosurgeon, a
highly specialised and extensively trained medical professional,
has to be placed within one of the 20 Salary Scales; so also
the grave digger who may be requested to finish the job if, for
whatever reason, the invasive procedure of the former does
not yield the desired outcome. The challenge of placing all
categories of employees in 20 salary scales exerts particular
pressure on remunerating officers occupying the top jobs in the
Maltese Public Service. Ministry of Finance, the Economy and
Investment (2012, p.10) states that:
“Currently, all categories of public service employees are
covered by the collective agreement. This implies that, even the
higher echelons of the service are subject to the same provisions of
the same employees. The vast majority of employees in the public
service are also governed by sectoral agreements which primarily
regulate a career path and any other form of compensation
which is particular to the category of employees which takes into
consideration market forces. The higher echelons of the public
service are an exception to this rule as this category of employees
has its conditions stipulated in a personal contract which follows
a standard template which ensures uniformity; but, as a general
rule, fails to capture specific responsibilities.”
Sectoral Agreements
Sectoral agreements are agreed upon following the signing of a
collective agreement. They are typically valid for a period of not
less than five years from the date of signing. Revisions prior to
the lapse of this five-year period are only made in exceptional
circumstances and subject to the agreement of both the
administration and the respective union/s (Collective Agreement
for Employees in the Public Service, 2017, Clause 8.2).
There are currently some 70 sectoral agreements within the
public service. These agreements were introduced during the
1990s and there are still a small number which have not been
amended since. These sectoral agreements are signed between
the Government of Malta and the trade union/s representing
particular categories of employees.
Normally, these agreements are negotiated with unions that
are assumed to represent the majority of a particular group of
employees. The granting of recognition gives the right to the trade
union to negotiate on behalf of a group of employees. However,
a number of sectoral agreements are concluded and signed
with more than one trade union. The sectoral agreements cover
particular working conditions for different sections, professions
and grades within the public service. They also include a number
of allowances, most of which are strictly related to the grades
which the document covers (JNT, 2009). The same document
also plots the relationship between the basic salary emanating
from the collective agreement and ad-hoc allowances emanating
from the respective sectoral agreement. There are instances when
allowances drawn from such sectoral agreements constitute
a substantial percentage of the take home pay. This situation
spurred the retired senior public officer to comment that:
For years, the grouping of the different grades in 20 Salary Scales
that was established years ago has long lost its purpose. And, with
the patching that had been introduced over the years, the situation
has worsened. The current system has to be completely scrapped.
A new one, built on the current one as may be anticipated, has to
be concluded as soon as possible (interview script).
These words invite a critical evaluation of the mechanisms in

place when it comes to awarding pay packages in the public service.
The Public Sector

The remuneration package of the public sector is more generous
and pre-requisites are less onerous than those applied to the
public service. Admittedly, public sector organisations are obliged
to operate more closely to the private enterprise model and as
such may require to offer a competitive edge with respect to the
public service in order to be able to recruit and retain employees.
Moreover, each separate entity in the public sector, with its
separate legal personality, negotiates the remuneration package
for employees covered by the collective agreement directly with
the trade union (which in most cases enjoys sole recognition).
The respective history and position in the sector of operations
exerts pressure on the final remuneration package. Furthermore,
when it comes to analyse the history of the different collective
agreements of the same public entity over a specified period, one
can spot an accumulation of benefits which steadily enhance the
overall remuneration package. This may lead to disparity in the
pay packages of related jobs, particularly between established
entities and emerging new entities.
One caveat here deals with the fact that not all public sector
entities have a majority of their employees represented by a
trade union. In cases where there is no collective agreement,
the Administration, through Directive 7, provides a structured
approach for establishing approved pay packages for a definite
period of time. When the approved period elapses, the
Administration will evaluate pay packages accordingly.
Comparisons
When looking at similarities and contrasts between the

remuneration packages of the public service and public sector,
one needs to digest two particular factors.
The first is internal poaching. The Maltese public

administration faces a particular phenomenon as regards
mobility between sectors, especially when it comes to recruit
and retain professional grades. The overall remuneration
package, as already stated, is better in the public sector than
in the public service. And so, the latter is the underdog when
recruiting and retaining professionals is concerned, especially
in financial, architecture and engineering. The setting up of the
Foundation for Medical Services (FMS) to recruit professionals
to be deployed in the national hospital which, by its very nature
is run on the public service model, speaks volumes. One can also
state that this approach is an official bypass of the remuneration
system within the Maltese public administration
The second deals with the transposing of benefits by trade
unions. The rivalry to recruit, retain and represent members
that exists between the trade unions exerts pressure to enhance
requests based primarily on a populist approach to better appeal
to members. This is especially so between the only two, catch-all,
general unions in Malta: the General Workers’ Union (GWU)
and the Unjon Ħaddiema Magħqudin: Voice of the Workers
(UHM). Pullicino (2003, p. 3) states that:
The GWU and the UHM are often competing for the same
worker membership in both the public and private sectors ....
This further complicates the otherwise more straightforward
tension between capital and labour. It now colours the dynamics
of various workplaces and cannot be disregarded.
Additionally, the trade unions, and especially the GWU and

UHM, have a broad exposure to the wider public administration;
they tend to have the upper hand when negotiating with
individual entities. Senior management in the Maltese public
administration may be highly qualified and competent,
particularly as regards technical expertise; however, they may be
somewhat lacking when it comes to knowledge and experience
in applied industrial relations. This could give a tacit advantage
to trade union officials, most of whom are highly seasoned
in industrial relations negotiations and operate full-time on

trade union business. By way of illustration, an agreement
was signed in September 2018 between Government and the
UHM covering the care workers stream, without prejudice to
an eventual agreement on an early retirement scheme (Grech,
2018).
To counterbalance this deficiency in institutional expertise in
industrial relations, the Maltese public administration has set up
a unit to provide such expertise and advice to both public service
and public sector management during the negotiating process.
The public administration has taken the initiative to organise
tailor-made courses in applied industrial relations. This initiative
is being supported both by the Institute for Public Services and
the Centre for Labour Studies (CLS) at the University of Malta.
(Ironically, many trade union officials and representatives have
studied industrial relations at courses organised over the years
by the CLS, formerly known as the Workers’ Participation
Development Centre).
This chapter now moves on to present the major milestones
of the evolution of the central unit responsible for assisting the
official Government side during the negotiating process. The
benefits of having such a centralised unit, versus a decentralised
negotiating function, will also be reviewed.
A Centralised Unit for industrial relations involving state

employees
Through a 2010 letter circular, the Public Administration

Collective Bargaining Unit (PACBU) was officially set up. This
decision amalgamated the former Collective Bargaining Unit
(CBU) and the Joint Negotiating Team (JNT), which had been
set up in 2004 and 2007 respectively. PACBU was directed
by a policy board composed of the Ministry of Finance as
chair, the Principal Permanent Secretary as deputy chair and
the Permanent Secretary of the then Ministry of Finance,
Investment and Economy (MFIN). PACBU was housed as an

independent unit within MFIN and was commissioned to “act
on behalf on Government in all matters relating to industrial and
employment relations as applied to Government in its capacity
as employer”. This letter circular emphasised that PACBU was
expected to encourage and empower line management to own
the negotiating process. The circular concludes thus:
one cannot emphasise enough the need for the line managers to
take full ownership while fully respecting central Government
as a model and effective employer (Letter Circular, 9th December
2010).
The Role of the Central Unit

In 2011, OPM Circular 12/2011 communicated the role of
PAHRO and PACBU in human resource management. This
circular confirms the thrust of the Letter Circular dated 9th
December 2010:
The re-designation of the Central Bargaining Unit and the
Joint Negotiating Team as PACBU is aimed at consolidating
Government’s negotiating position both across the Public
Service and the Public Sector.
This circular reminds senior management of both the public
sector and the public service that, in-line with Directive 6,
PACBU must be consulted on matters relating to the negotiating
process and discussions with trade unions. In line with Clause 4
of the Public Administration Act, the administration may issue
directives and guidelines from time to time.
In December 2015, OPM Circular 20/2015 reinforced the
obligation emanating from Directive 6 that PABCU has to be
consulted in a pro-active manner to ensure harmonisation
within industrial relations.
Here, there is an interesting amendment to Directive 7.2:
Delegation of authority to effect recruitment, promotions and
industrial relations in public sector entities. This amendment
departs from the strict obligation to consult the Industrial
Relations Unit (IRU), the title of the centralised unit following
the latest rebranding, and places more responsibility on the

respective head of the entity. However, this amendment is
not to be read or interpreted as diluting the role of IRU in the
negotiation process. It states that:
IRU sanctioning is invariably binding, even in cases where the
IRU is directly involved in negotiations by the head of entity after
consulting the respective permanent secretary. The Ministry
for Finance will be informed of any position taken by the IRU.
The responsibility to ensure availability of funds rests with the
respective head of entity.
This brief synopsis of the developments of the central unit
responsible for conducting industrial relations and eventually
pay packages in the MPA, foregrounds the following points
which influence the way pay packages are negotiated in the MPA.
First, the administration has, over the years, felt the need to
have one unit assist both the public service and public sector in
negotiating pay packages. The main reason for this centralised
approach is to ensure that Government has a consolidated
position across the MPA in the negotiating process.
Second, the issue of ownership, and who is ultimately
responsible for the pay package negotiations. Over the years,
this has shifted from a rigid and bureaucratic obligation to a
more responsibility-based principle.
These two points highlight the argument of centralisation
versus decentralisation of the industrial relations function, in
particular in how pay is determined within the MPA. Woods
(2009) acknowledges that one cannot escape the fact of a
centralised system has the undertones of a ‘one size fits all’
approach. Curmi (2016) traces this preference for a centralised
function in decision making to the British colonial period and,
as such, one can say that it is deeply rooted in the MPA culture.
Woods (2009) refers to two articles penned by Gejtu Vella, former
Secretary of UHM, dated 6th August and 8th August 2003, and which
strongly criticised the centralised approach in industrial relations,
particularly with the setting up of the Collective Bargaining Unit
(CBU). On the other hand, this centralised unit was considered
as a much needed pool of expert advice and support by the senior

management of public entities (Woods, 2009).
From the fieldwork carried out in preparation for this write
up, respondents commented on a current bureaucratic setup
that is inclined towards a centralised system in the way pay
structures are determined within the MPA. The retired civil
servant admitted that,
The Malta public administration is composed of different
strata of power and assumed decision making authority, the
Ministries, the politicians, the senior civil servants and public
opinion. The situation brings about delays in taking appropriate
action (interview script).
A retired senior trade union official identified a set of
characteristics which add flavour to pay negotiations within the
MPA: (1) more than one trade union around the negotiating
table; (2) competition between trade unions; (3) more than one
ministry involved; and (4) the involvement of politicians, who
may wish to micro-manage and/or have a say in policy execution.
The other retired union official did not mince his words when
comparing how pay packages are negotiated between the public
and private sector:
The private sector is more pro-active when conducting industrial
relations. This stems from the fact that, in most cases, industrial
relations are conducted by the business owner and/or their
representative/s with an immediate open line of communication.
On the other hand, the Malta public administration has various
tiers of authority. Unfortunately, this process is time-consuming
and creates uneasiness among workers and their respective trade
unions. To compound matters, the respective trade unions may
at times be at loggerheads due to issues of union recognition at
the same place of work (interview script).
This chapter has so far considered the major influences that

impact on pay packages, the final product of the negotiation
process. Literature suggests that the state of a country’s
economic health and growth prospects may also be a significant
intervening variable. There appears to be a positive relationship

between the Gross Domestic Product of an economy and the
final remuneration package awarded to state employees across
Europe.
Influence of Economic Health on MPA Pay Packages
When analysing Ireland’s reform of its public service in a time of

fiscal crisis, Boyle (2016, p.140) declares that,
The general public have become more aware of the
interdependence between the performance of the Public Service
and the performance of the economy, with the quality of public
governance being seen as contributing to economic stability and
growth.
Boyle (2016) argues that, during the period of economic

growth, both staff members and pay packages in the Irish public
service increased significantly. In the private sector, remuneration
packages depend exclusively on the organisation’s turnover,
value added and its position in the market; productivity gains are
considered paramount to ensure competitiveness in the respective
market (MISCO, 2016). In contrast, in the public sector, the
extent of national economic growth exerts a determining factor,
both positively and negatively. Periods of national financial crisis
lead to the imposition of austerity measures on pay packages
to public service employees (European Public Service Union,
2017). Pay cuts or pay freezes were imposed on public sector
employees in 19 out of 28 EU member states in the aftermath
of the 2008 global financial crisis. The recent economic growth
experienced by Malta is whetting the appetite of trade unions
negotiating pay packages with MPA, and they are tempted to ask
for more than they would have otherwise. And, once a generous
deal is secured with one sector, the precedent is set for other,
cognate groups to request, and expect, the same largesse. A Press
Release issued on the 6th December 2017 captures a statement
by the Minister responsible for Finance: “record economic

growth translates into higher employment income and profits”
(Department of Information, 2017). Such statements are music
to the ears of trade unionists when negotiating pay packages
within MPA, shifting negotiations away from strict productivity
concerns. One can argue that, if state employees bear the brunt
of an economic crisis; then it would be logical to expect them
to deserve a pay rise during spells of economic growth. Trade
unions across the board are currently equating economic growth
with a justification for making claims for a pay rise that would
apply to the MPA.
Sustainability
On a short term basis, one can accommodate pay rises aligned
to national economic growth; but not beyond. This brings to the
fore the issue of sustainability. One retired union official argued
that,
Malta is passing through a good economic phase and government
income is on the increase, providing a more sustainable basis to
pay increases (interview script).
On the other hand, the other trade union respondent stated

that,
Such wage increases are sustainable only if the public sector
is not burdened with more human resources than absolutely
necessary (interview script).
These replies may suggest an element of political polarisation

in how trade union officials, depending on political allegiance,
may perceive the sensitive issue of negotiating pay within the
MPA.
Consequential Costs versus Profitability

In the private sector, one can easily argue that a pay rise based
on increased productivity can be equated to yield more profits.
Applying the same principle – aligning pay rises with increased

productivity – might easily give the opposite result if applied
to MPA as it could lead to an increase in state expenditure.
Consider the incentive offered to officers in the medical class
which enhances their take-home pay via sessions paid for at
an agreed rate, over and above the applicable basic wage (as
noted in Table 1) (Agreement between the Government and the
Medical Association of Malta, 2017). This increases pressure on
Government’s budgetary expenditure: not just for the additional
remuneration to doctors, but also for the additional costs of
support staff needed to assist the doctors and any direct costs
(linen, pharmaceuticals) associated with an increase in medical
procedures. Of course, the social benefits of an increased
presence of doctors in state hospitals and polyclinics can be seen
to justify such costs.
Monetary versus Social Profit

The 2017 sectoral agreement between the Malta Union of
Teachers and Government hopes to change the current
educational system from one based on students requested to fit
into an established curriculum to a system based on a ‘learning
outcomes framework’, designed around the ability of each
individual student (Agreement between the Government of
Malta and the Malta Union of Teachers, 2017). This pedagogical
re-engineering will oblige the teaching profession in Malta to
change some of its established ways of operating (for example,
in modes of assessment). Hopefully, the pay increases and
allowances awarded to the teaching grades as a result of this
agreement would bring about a positive effect on the level and
quality of education of school leavers in Malta. How much would
such a transformation be worth? It is very difficult to assign a
price tag on the rate of return of pay packages awarded to public
employees.
Conclusion
Malta’s public administration should continue to ensure a

committed workforce, proud to be serving in the national interest.
Nevertheless, it should not lose focus: a competitive pay package
and attractive career opportunities exert significant pragmatic
pressure on the recruitment and retention of such a committed
workforce. This approach also needs to be supplemented by
other HR policies. MISCO (2016, p. 1) states that,
We strongly believe that salaries are just one component of the
HR strategy of an organisation. This needs to be supported by
appropriate training and development activities, motivational
activities and creating a work environment that is caring of the
employees’ wellbeing.
This chapter has reviewed some of the key characteristics

that govern industrial relations amongst the employees of the
state. The differences between the public sector and the public
service, the centralised role of IRU and the issue of ownership
of negotiation, the vested interests of the various trade unions,
and the relationship between national economic health and pay
packages were presented and discussed. These features have a
role to play in the eventual determination of the pay packages, and
other benefits, that go to the different categories of employees in
the MPA.
To conclude, this chapter borrows from the advice tendered
by the PSRC (1989, p. 54),
Government needs advice on policy options, information about
wage and salary levels in Malta and abroad, and evolution of claims
from trade unions. It needs an organisation that will conduct
ongoing reviews of a range of issues, including service-wide
salary structure, compensation packages for specific positions,
allowances and the costs and benefits of performance pay.
Thirty years after being proposed, these words remain just as

relevant, and ominous.
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University of Leicester.
Financial Services:
Banking on Success
Gertrude Spiteri
I am convinced that nothing we do is more important than

hiring and developing people. At the end of the day you bet on
people not on strategies. (Ken Robinson, Professor Emeritus,
University of Warwick, UK).
Since the global financial crisis of 2008, the financial services

industry worldwide has made a relatively successful recovery.
Wyman (2018, p. 3) asserts that “the financial services industry
has come from the brink of disaster towards relative health”.
Participants in the European Attractiveness Survey (2018) seem
optimistic about the future outlook of the financial services in
Europe. In the European Union, banking and related financial
services activities make a significant contribution to the EU’s
economy. Recent figures suggest that financial services jobs
(excluding insurance and pension activities) represented around
1% of total employment; covered 3% of all remuneration received
by employees; and created 4% of gross value added in the EU
economy (European Bank Federation, 2018). The European
Central Bank is the central bank for the Euro area. Its main task is
to maintain price stability and preserve the purchasing power of
the single currency. Other tasks include implementing monetary

policy and banking supervision for the Euro area (Hartmann &
Frank, 2018).
A newly emerging global challenge for this industry is the rapid
growth of Big Tech firms who are creating an exciting customer
experience and added value. These firms are presently in the
driving seat of growth in this sector. The main challenge they
pose to the more traditional financial services firms is that they
are able to resolve several customer problems which traditional
firms in financial services cannot. Although traditional firms
have been found to have increased internal efficiency, they have
still lagged behind in creating new customer value and growth.
In the Global CEO survey conducted by PWC (2016), 70% of
leaders in the financial services cited the speed of technology as
a worrying factor. To compete with ‘Big Tech’ firms, traditional
firms in financial services need to become more innovative and
think outside the box in the way they deal with their customers
(Wyman 2018). This is perhaps the reason why innovation and
technology seem to be the precursors to success. Indeed, the
successful transition to the digital era is the main concern of
financial services investors in Europe (Van Loo, 2017).
In Malta, the financial services industry is among the major
contributors to the Maltese Economy. The sector is largely
dominated by the activity of banks, investment funds, special
purpose entities (auxiliary services) and pension and insurance
activities. The financial services industry has blossomed since the
country joined the European Union. Malta’s strategic position
and business climate have attracted financial service industries
to the islands.
The establishment of Malta’s four core banks, which were the
origins of Malta’s banking industry, date back to the arrival of
British rule in Malta. A group of English and Maltese merchants
established the first bank on 23 June 1809: the Anglo-Maltese
Bank. This was the precursor of today’s Bank of Valletta. A
second bank, Banco di Malta, was established in 1812. The first
bank notes issued by these banks were in scudi and later on in
Financial Services: Banking on Success 413
sterling. A third bank, Banco Tagliaferro e Figli, was also set

up in 1812 and the fourth, by Joseph Scicluna, in 1830. These
four banks later on merged into The National Bank of Malta.
In 1973, Parliament passed the National and Tagliaferro Banks
Act, and on 22 March 1974, Bank of Valletta was born, which
took over the assets and liabilities of the National Bank of Malta.
The new shareholders of the Bank were 60% Government and
40% Malta Development Corporation. Later on, a 20% stake
of the Malta Development Corporation was sold to Banco di
Sicilia and another 10% to the Maltese public. The Government
shareholding was reduced to 51% in 1990 and 4.9 million shares
were offered to the public (Consiglio, 2006).
The other core bank, currently known as HSBC Malta, started
its operations in 1864 as the Anglo Egyptian Bank which was
a merger between The National Bank of South Africa and The
Colonial Bank which was established in 1836. It became known
as Barclays Bank Dominion Colonial Overseas in 1925. In
1954, it shortened its name to Barclays Bank DCO and in 1971
it became Barclays Bank International. In 1975, this bank was
nationalised and became known as Mid-Med Bank. In 1991, 33%
of Mid-Med shares were sold to the public and, in 1995, Mid-
Med acquired 25% of Lohombus Bank and Investment Finance
Bank in Malta. In 1996, another 35% of Lohombus shares were
obtained by Mid-Med Bank (Consiglio, 2006).
In 1996, Midland Bank was the first foreign bank to be
granted an unlimited banking license in Malta. In 1999 Midland
Bank acquired the Government of Malta’s 60.1% direct holding
in Mid-Med as well as 2.7% indirect holding. When HSBC
brought all its operations under one name, Mid-Med became
HSBC Malta plc. (Consiglio, 2006).
Lombard Bank of Malta dates back to 1955 when Lombard
North Central of the United Kingdom started taking deposits in
Malta through a number of agents. In 1990, the bank became a
public limited company and offered equity to the public. In 2007,
Cyprus Popular Bank acquired 43% of the share capital from
Banco Svizzero Italiano and other international investors for €45
million. In 2018, the Government of Malta, through the National

Development and Social Fund, acquired 49.1% of issued share
capital from Cyprus Bank (Consiglio, 2006).
APS Bank was established in 1910 as one of the projects set
up by l’Unione Cattolica San Giuseppe. The main purpose of the
bank was to imbibe a ‘savings habit’ among the working classes.
Since then, its role has evolved and the bank has positioned itself
as a cost-effective financial institution while retaining personal
banking as its major strength (Consiglio, 2006).
The banking sector has grown in the last twenty years, from
four core banks serving the local population, to 25 licensed banks
as at the end of 2017, with only three having Maltese majority
shareholding. 71% of the banking sector’s total assets of around
€48 billion are foreign-owned. The sector is made up of core
domestic banks, non-core domestic banks and internationally-
oriented banks.
The six core domestic banks with assets of around €23 billion
represent 207% of Malta’s GDP. They depend highly on business
with Maltese residents, and employ 83% of the sector’s workforce
which numbered around 4,900 employees in 2017. The services
offered by such banks follow a conservative business model,
which mainly consists of raising deposits and granting loans to
Maltese residents (Cardona, 2018).
Five non-core domestic banks have assets of €2.2 billion,
representing 20% of Malta’s GDP. These banks undertake some
business with Maltese residents, but not as their core activity.
As such, the linkages with the domestic economy are limited,
with resident assets and resident liabilities each accounting
for less than one-fifth of the banks’ balance sheet size. With a
Tier 1 capital adequacy ratio of 13.3%, these banks have a good
shock-absorbing capacity to cover a potential deterioration
in asset quality. Considering also their limited exposure to the
domestic economy, these banks are not deemed to pose a threat
to domestic financial stability (Cardona, 2018).
The 14 internationally-oriented banks are mainly subsidiaries
and branches of large international institutions with almost no
links to the domestic economy. Their combined assets, amounting

to around €23 billion, represent around 207% of Malta’s GDP.
They fund themselves mainly through the wholesale market or
through their parent banks, and deal mainly with intra-group
activities. Overall, this group is also very well capitalised, has
strong liquidity and is profitable. Here again, therefore, the very
low level of business carried out with Maltese residents, and
the fact that these banks have negligible contingent claims on
the Deposit Guarantee Scheme, mitigates possible concerns
regarding the size of their asset base in relation to GDP, or the
threat they might pose to domestic financial stability (Cardona,
2018).
Other sectors in the financial services industry also indicate
growth: an apt example involves insurance activities which have
increased from €9.5 billion in 2010 to €151.4 billion in 2016;
98% of which was foreign direct investment. According to a
survey conducted by PWC, the Insurance and Investment Funds
providers benefitted from an increased volume of business
and increased profitability during the first six months of 2018.
Overall, general optimism was recorded by respondents to the
PWC survey (2018) from all sectors of the financial services.
The financial services industry is regulated by the Malta
Financial Services Authority (MFSA). The Central Bank of
Malta is primarily responsible for maintaining price stability
through the formulation and implementation of monetary
policy and for promoting a sound financial system and orderly
capital markets. To this end, a Joint Financial Stability Board, set
up between the MFSA and the Central Bank of Malta, focuses
on macroprudential aspects of financial stability, extending its
remit to the entire financial sector.
Statistics report a healthy and growing financial sector
in Malta. In a report by the MFSA, Cassar (2017) highlights
significant increases in various areas benefitting the financial
sector. He indicated an increase of 18% in output from the
financial sector, from €5,041 million in 2010 to €5,950 million
in 2016. Output is defined by Eurostat as the products created
and services rendered in a particular sector during a particular

time period (Cassar, 2017). This positive scenario attracted more
company registrations, investment services, license holders and
other service providers. There were also 60 new funds registered
in 2016. The Gross Value Added, which is the value generated by
a sector after subtracting input costs, amounted to €598 million
in 2016, which is 6.9% of total national gross value added (Cassar,
2017).
Employment in the Financial Sector
Gross value added attributable to compensation of employees

in the financial sector has increased from 50% in 2010 to 59%
in 2016. Compensation of employees is defined by Eurostat
as consisting of all remuneration, in cash and in kind, which
employees receive from their employers in return for work
done. Between 2010 and 2016, compensation to employees in
this sector rose 56%: from €226 million to €353 million. This
was above average: growth across the Maltese economy was 47%
during the same period. This indicates that there was a substantial
increase in employment in this sector: in fact, between 2010
and 2016, employment within the financial services sector grew
by 13.7% to 10,345 jobs. The largest growth was attributed to
insurance and pension funding (21.6%). When calculating the
total employment multiplier, this indicates that three new jobs
are created in the economy for every €1 million of additional
final output (Cassar, 2017). The financial sector is estimated
to account for 10.2% of the total employment in the economy
(Economic Survey, 2017).
A review of a sample of collective agreements in August
2016 indicates that, when compared to other sectors, the annual
basic salary received per capita in the financial services industry,
before any social contributions and tax deductions are paid, is
the highest at €24,148 (Economic Survey, 2017).
The growth prospects of this sector look favourable and steady

but there are some measures that need to be taken for Malta to
sustain its reputation and status as a financial centre (European
Commission, 2017). Among these are to improve labour supply,
strengthen the business environment and upgrade supervision in
the financial sector in order to safeguard its favourable position
and reputation as an investment destination. These suggestions
have led to the amendment of the Banking Act in 2016 and the
adoption of a Money Laundering Directive in 2017.
Human Resource Professionals: Facing the Challenges
Take away my people, but leave my factories and soon grass will
grow on the factory floors. Take away my factories but leave my
people and soon we will have a new and better factory. Andrew
Carnegie, Scottish-American industrialist, business magnate,
and philanthropist.
The human resources profession in Malta is facing several

challenges across all business sectors. The rapid growth in
the economy, together with an influx of foreign workers,
have changed the demographics of the local workforce. As a
result, there exists a wide gap between business demand and
supply, employee and management expectations, cultural and
generational work ethics. This presents an exciting opportunity
for human resource professionals to redefine human resource
practices and make this profession relevant and vibrant (Rao,
2017). One way of dealing with these challenges is for human
resource professionals to move from a transactional to a more
strategic approach. The role of the modern human resource
professional goes beyond the management of employees. To be
effective, the human resource professional needs to be cognizant
of what is happening globally and locally in the particular sector
and also be part of the business strategy. To this end, today’s
human resource professionals need to: understand the business

and global environment in which they operate, analyse trends
in employment, and develop strategic policies in order to align
business and employee needs (Armstrong, 2003). Rousseau and
Barends (2011) argue that human resource practice needs to be
based on evidence. They suggest four main strategies towards
an effective implementation of evidence based, human resource
management: (1) making use of the best available scientific
evidence; (2) gathering facts in a systematic way, including the
use of indicators and metrics; (3) adopting practices, procedures
and frameworks which reduce bias and improve the quality
of decisions; and (4) analysing the impact of decisions on all
stakeholders involved in a critical, ethical and considerate
way. Adopting such evidence based practices would assist the
human resource professional in looking beyond the numbers
and understand the stories that are being told and the challenges
these stories present. Doing so would result in strategic and
effective evidence-based decision making.
Miranda (2005) suggests that, for HR professionals to be part
of the strategic plan of a business, they need to be at par with
other leaders of the business. He suggests that to achieve this
aim, human resource professionals need to free time to think
and analyse. He suggests that the first step in doing this is to trim
administrative processes by asking three important questions:
(1) When was this process created? (2) Why do we do it this way?
And (3) What would happen if we did not do this at all?
In today’s world, financial institutions have to struggle with
various regulations and involve themselves in much duplication
of effort, making it difficult to achieve time and cost efficiencies.
Institutions in the financial industry face numerous challenges when
conducting business in a regulatory environment of intensified
scrutiny and strict compliance requirements. They are compelled to
adjust their operations in order to manage compliance effectively. In
view of this, the main challenge of the human resource professional
in this industry is to focus on what is essential, such as ensuring
the flow of information and that risk and compliance procedures
are adhered to in a standard and efficient manner. This will help

them deploy effective strategies that align business needs to the
employees who are the drivers of growth in the financial industry,
and whose main output is as providers of services.
Research Methodology
Data was mainly obtained from reports by the National

Statistics Office, Malta Financial Services Authority, the
Price Waterhouse Coopers (PWC) Survey (August 2018), the
European Commission country report on Malta (2017), the
European Attractiveness Survey and the Economic Survey for
Malta 2017.
To ground the data into the current local financial
sector scene, questionnaires and interviews were used. The
questionnaires and interviews addressed the challenges faced
by human resource professionals in the financial sector.
The questionnaire was sent to 15 human resource
professionals working in the financial sector, hailing from
banking, insurance and fund management companies. The
specifically asked questions included: (1) What are the human
resource challenges you are currently facing? (2) Do you think
these challenges are particular to the banking sector? And (3)
What are the remedies that are being applied to counteract
these challenges?
The questionnaires were followed up with three detailed
interviews held with human resource professionals from
banking, investment services and insurance respectively.
During the interviews, the responses from the questionnaires
were delved in deeper and the discussion again centred around
the challenges these professionals were facing and how they
were dealing with them. Four main themes were elicited from
the questionnaires and interviews: (1) the shortage of labour;
(2) the diversity of the workforce; (3) turnover among staff; and
(4) worker training and development.
The focus now turns to discuss the themes which came up

from the research conducted, linking them to statistics and
reports on the current position in the financial services in Malta.
Shortage of labour
The shortage of labour and skills was one of the challenges
highlighted by the European Commission in their country
report on Malta (EU Commission 2017). In 2017, more than
30% of companies reported labour shortages. This was one of
the highest in the EU and had increased significantly compared
to 2016. Shortages were more pronounced in the services
sector, with almost 40% reporting low availability of labour, thus
constraining their business. The highest shortage was in high-
skilled jobs, which resulted from the fact that Malta has the lowest
number of tertiary level graduates in the EU. Consequently, the
shortage of labour is nowadays more pronounced in sectors
requiring high skilled jobs such as in healthcare, finance and ICT
(EU Commission, 2017). The employment rate for graduates is
97% which infers the need for highly skilled people in the labour
market. A survey highlighted that 81% of financial service
companies in Malta are predicting that they will continue to
increase workers over the next five years. A survey carried out by
PWC named the shortage of labour as a limiting factor for capital
expenditure across all financial sectors. When respondents
were asked about what needed to be done to strengthen Malta’s
competitiveness, national initiatives to address these human
resources constraints was deemed an urgent priority (PWC,
2018).
The demand for labour highly exceeds the supply of human
resources in the contemporary Maltese labour market. This poses
a challenge to HR professionals since ensuring the right amount
of human resources falls directly under their remit. As in any
other project, before implementation, one needs a clear analysis
of the resources available. Looking at the EU Social Scoreboard
for Malta, there is a clear indication of a waste of resources and
talent in the light of early school leavers in the workforce. The
rate of early school leavers is among the highest in the European

Union at 19.6%. This is higher for males than females. Given that
the financial services sector needs highly skilled employees, this
is a big chunk of the workforce which is eliminated from access
to the financial sector. Human resource professionals in the
financial services need to find ways to tap into this resource and
collaborate with educators to support students to stay in school
and direct them towards the financial sector. This would be a
win-win situation for the students themselves as well as for the
financial services industry.
The National Skills Council was set up in 2016 to target digital,
research and development skills, but its success and impact has
been limited. Perhaps a more individual approach is required
in order to make assessments of strengths and weaknesses of
individuals who are not performing well enough at school. HR
professionals need to look beyond the current workforce and
become strategically involved in planning for future workforce
requirements. This may be achieved through regular and
strategic collaboration between human resource professionals
and educators.
Females over 30 years of age

Figures in the Economic Survey of 2017 indicate that the gender
gap in the labour force is still present, especially among females
over 30. There were positive indicators such as an increase of 3,622
females who entered the labour market in 2017, and a decline in
female inactive persons from 105,176 in 2016 to 104,473 in 2017.
These positive indicators demonstrate that initiatives such as
‘Make Work Pay’ are effective. However, females still continue to
hold the largest share of persons holding part time jobs as their
main occupation and female employment accounted for only
39.1% of the workforce. More research needs to be conducted
to understand the low rates of female participation in the labour
market.
These figures provide an opportunity for human resource
professionals to find ways to tap into these resources and
seriously examine the possibility of directing early school

leavers and females over 30 towards the financial sector. Human
resources are the main resource of our islands and they need to
be used intelligently.
Foreign workers
The shortage of labour is causing local firms to rely on foreign workers.
Such inflows of foreign labour was essential in order to maintain the
growth of the Maltese economy (EU Commission, 2017).
Being a highly regulated sector, the ability to attract the right
talent is crucial to the success of a competitive financial industry.
The shortage of labour is across the board. Consequently, small
companies are competing with larger ones for talent. The share of
foreign workers has increased substantially across all skill levels
and reached 16.7% of the total workforce in 2016 (compared to 5.5%
in 2009). While Malta is experiencing comparatively high growth
in ICT services, the share of graduates in science, technology,
engineering and mathematics (STEM) is insufficient to meet this
demand and is well below the EU average: 1.5% compared to 1.8%
in the EU. Over two thirds of foreign workers originate from the
EU: 71.8%; while the remaining 28.2% are non-EU nationals. A
survey conducted by PWC regarding financial services highlighted
the shortage of labour as one of two limiting factors for increasing
the level of business of respondents. The other limiting factor
identified was the burden of increased legislation.
In relying more on foreign labour to address labour and
skills shortages, most human resource professionals highlight
the difficulties they face in recruiting foreign employees, and
especially third country nationals. Identity Malta is the agency
set up in 2013 to deal with these issues and there have been
continuous attempts to facilitate the process of recruiting third
country nationals. Identity Malta has implemented the Single
Work Permit EU directive 2001/98 through LN60/2014. The
Single Work permit specifies a single application procedure for
both work and residency in Malta. However, the demands of the
labour market have grown so fast that the agency is considering
further options to simplify the recruitment of employees,

especially of third country nationals, without compromising on
due diligence exercises.
To attract the best talent, human resource managers in financial
services must offer attractive packages to new employees. This
does not only mean increases in salaries but also more flexible
approaches towards work. The data confirms that the financial
services sector offers the highest rates of compensation across
all sectors. In marketing, the modern strategy to increase sales
and overcome competition is to offer value to customers. The
customers of human resources departments are their employees.
Human resource professionals should learn from these marketing
strategies and particularly in such a restricted and competitive
environment, they need to focus on the employee experience
and make it as attractive as possible. Employers need to know
their employees down to the Employee Genome Level (Ballack
et al., 2017) and be able to respond to their individual needs in
order to deliver a personalised employee experience for today’s
workforce demands.
Ulrich (2005) suggests innovative solutions for dealing with
the current human resource global challenges including flexibility
in working conditions, a sense of community, transparency in
communication and continuous development. He argues that
when doing so, human resource professionals will be giving a
voice to their employees. This will in turn result in increased
employee engagement and commitment.
The author’s investigation indicated that attracting the best
talent was a challenge mentioned by all participants. In addition
to recruiting the best talent, participants also referred to a longer
process in recruiting employees in this sector due to regulatory
restrictions. This process is even more challenging when it comes
to the recruitment of foreign workers. All the respondents agreed
that the shortages are not particular to the financial sector;
however, due to the level of specialisation and output accuracy
that is required, the problem is more pronounced in this sector
than in others such as tourism where there are less restrictions.
Diversity
Although the financial services sector attracts professionals in
the field who are very well conversant in English, which is the
language of finance, having such a diversity of cultures presents
another trial to human resource professionals. However, if
managed well, this challenge could be turned into an opportunity
and can enrich the workforce. Since a high number of foreign
employees in the financial sector are graduates, the sharing of
knowledge can have a beneficial effect on the local workforce.
Intelligent management of a culturally diverse workforce could
be an enriching experience to all stakeholders involved. However,
if not managed well, it might lead to conflict between employees
and a loss of valuable resources. Human resource professionals
need to be able to harness the resources of such cultural diversity
into a competitive advantage. This could be achieved through
culturally diverse training and making inclusion an important
priority on the policy agenda.
On a national level, Malta has continuously strengthened
its policies for active inclusion but such initiatives need to be
supported in the workplace, where employees spend most of
their time. Different cultures have different attitudes towards
work. The role of the human resource professional is to get to
know employees at an individual level: what work means for
them, what aspect may appear rewarding to them, how they
take decisions, what are their priorities, etc. Human resource
professionals need to make the best use of analytics which will
help them design policies suited to their particular workforce.
Diversity needs to go beyond different cultures but also
include generational diversity which leads us to the millenial
challenge. Fishman (2016) researched the American workforce
and highlighted the impact generational differences can have
on the workforce. Her findings indicate that understanding
the diverse generations which make up the workforce will help
employees reach their peak performance regardless of their age.
She suggests that historical events shape the values, attitudes,
lifestyles and priorities of the people of a generation. The current
workforce is made up of three generations: Baby Boomers (1943-

1960), Generation X (1961-1981) and the Millennials (1982-
2000).
Baby Boomers are self-assured, have a strong work ethic,
competitive and resourceful. They have strong interpersonal
skills and use technology as a productive tool in contrast to
millennials who use technology as a connectivity tool.
On the other hand, Generation X employees are more
practical, committed to their work and engaged. They take pride
in their work. They like to be in control and do not like to be
micro-managed.
Millennials are the workforce of the near future. They are
digitally literate, smart, technologically savvy and intelligent.
However, they have been brought up in an age where everything
is at their fingertips; this makes them less patient; they want to
get ahead quickly and require instant feedback. They are also
empowered, which gives them a sense of entitlement (Fishman,
2016). They are assertive, know what they want and are more
conducive to a non-hierarchical structure. Half the workforce
already consists of millennials in 2020 (PWC, 2017).
This generational knowledge is essential for the human
resource professional. Owing to the cut-throat competition for
talent, human resource professionals cannot ignore the needs
of different generations of employees. First of all, they need to
understand where they are coming from and create bespoke
packages that meet their needs and expectations. For example,
in the case of millennials, human resource professionals need to
move from traditional approaches to more flexible, individualistic
work ones. Most of the time, the local human resource manager
in this sector, needs to balance two generational extremes: those
employees who are more used to a traditional approach with
the new generation of employees who are more assertive and
more prone to taking risks. Human resource professionals in
more traditional firms with a conservative business model, such
as the core banks, might not attract millennials because they
are looking for a more flexible approach. In workplaces where
employees from different generations work together, human

resource managers need to focus on initiatives that engage and
inspire all employees. Thus, the challenge is to juggle the diverse
needs and expectations of all employee types, and design policies
and practices which cater to them. As one respondent said: “The
concept of one size fits all is not always applicable”.
Turnover of employees
Attracting talent is not enough. Human resource managers
have the headache of retaining such talent. In the PWC survey
(2018), labour turnover was high across all sectors. Staff
turnover was also an issue for respondents of the questionnaires
and interviews. The comment ‘it is an employee’s market’ was
ubiquitously expressed. Human resource professionals need to
focus on the employee-management relationship and ensure a
healthy psychological contract. As mentioned earlier, employees
in the financial sector are highly qualified. Consequently,
they have more options available to them than employees in
other sectors. Therefore, it is imperative for human resource
professionals in this sector to have retention policies in place
because losing employees has a negative impact, both financially
and operationally.
The high rate of turnover, which is expected to increase
(PWC, 2018), indicates a lack of engagement with the company
as employees migrate from one company to another looking
for better prospects. Surprisingly, current research suggests
that, although turnover was a common issue in most of the
responses, a small company of less than 100 employees reported
no turnover. On delving deeper into the subject, it transpired
that this company took a very pro-active approach to retain its
employees. They ensured that retention of employees would be
a very important company priority. Consequently, although they
are operating in the same labour market, they have managed
to retain their talent. They have achieved this by focusing on
the individual needs of their employees, achieving their trust
by saying what they do and doing what they say. They are also
flexible in meeting the needs of their employees. In the words

stated by the HR professional concerned:
At our company, finding the right people with the required skill
set, retaining employees and managing diversity have not been
challenges which concerned us that much. Preparing against
such challenges is an ongoing process which takes time and
cannot be tackled in an “employees’ market” situation. This must
be a way of life that ultimately develops a good brand reputation
and brand image whilst the relationship between employer and
employee must be based on trust.
Human resource managers need to dedicate energies to

create ‘sticky environments,’ which employees find difficult to
leave. The main challenge for human resource professionals
is to understand what makes employees want to work in
their organisation. To meet this challenge, human resource
professionals need not only focus on exit interviews, but also
include retention interviews. They need to understand what
makes employees stay, not take these employees for granted
and then be surprised when a resignation letter is received. HR
professionals need to become proactive and create healthy work
environments. They need to understand the type of employees
that the particular work culture attracts and who is being left out
from this culture. They need to be alert and ask themselves: (1)
What type of employee does our cultural environment attract?
(2) What can we do so that other employees fit in and make them
reluctant to move away? And (3) What changes can be made in
the environment that will attract other types of employees?
Human resources plays a critical role in creating this sticky
environment. Such an approach can help a company retain
its people and in effect reduce expenditure through a more
focused and strategic approach, based on real evidence about
their particular workforce. Each company must find unique and
appropriate ways to create this stickiness, as techniques that work
well in one company may not necessarily work well in others.
Key to these non-traditional approaches is the willingness of
the HR practitioner to break away from sources of power and

control, and to approach classic business challenges from new
and unique perspectives.
Training and Development

It has already been established that the financial sector requires
employees with high skill sets. In analysing the statistics
regarding the availability of highly qualified employees, it is
clear that Maltese workers lag behind their EU counterparts.
According to the EU Commission report, the Maltese workforce
remains relatively low-qualified and Malta has the highest share
of such workers in the EU. In 2016, this amounted to 54.8%
among adults of 25-64 years of age. In 2016, 31% of foreigners
working in Malta had tertiary education compared to 20% of
local employees. Apart from having the lowest rate of graduates
in the European Union, participation in adult learning in Malta
was rated as 7.5% which is below the European Average of 10.8%
(EU Commission, 2017). As one of the participants commented:
“Sometimes we cannot find the people with the required skillset
and then we will have to give extensive training to meet the
standards required. This is expensive and takes a lot of time”.
Training and development of employees presents another
challenge to human resource professionals in the financial sector.
As regulation increases in this sector, with the Amendment of the
Banking Act and the Money Laundering Directive, continuous
training of employees in emerging practices and compliance is
imperative. Various initiatives are being undertaken by the main
educational institutions in order to align education with business
needs (European Commission, 2017). This presents another
opportunity for human resource professionals to become pro-
active and form partnerships with local educational institutions.
This will also ensure that students will have the required skills
and qualifications so that they could join the financial sector. In
recent years, there have been a number of initiatives between the
University of Malta and MCAST to offer internship opportunities
for students in the financial sector. Human resource professionals
need to make the most of this opportunity by engaging these

interns and increase the possibility of hiring them as full time
employees once they finish their studies.
The main responsibility of developing the workforce is an
essential part of the remit of the human resource professional.
In order to succeed in this, they need to understand the
requirements in their sector and look for ways to ensure that all
employees have, or can, acquire the necessary skills. They need
to look beyond traditional methods of training and become the
drivers of training and professional development, including
virtual training experiences, mentoring, sponsoring of further
studies and knowledge management procedures as part of
the employee development plan. A more flexible approach to
development will help employees develop at their own pace
and encourage them to improve their skills and qualifications.
By becoming more involved in the training and development of
their current and future employees, the HR professionals will be
taking a strategic approach to close the gap between the demand
and supply of workers within the financial sector.
Conclusion: The future is exciting
Blockchain technology is revolutionary, probably in the same

way that the internet was in the 1990’s. Malta has turned its
attention to developing and supporting distributive ledger
technologies and is attracting investment in this area. Malta is
the first country which has drafted legislation to regulate this
promising sector. It has already gained a reputation as being “the
Blockchain island”. In April 2017, Malta’s Parliament approved
the first draft of a national strategy to promote Blockchain.
Various national bodies are stepping up to meet this
challenge, through entities such as the Blockchain Committee
of the Malta Stock Exchange, a memorandum of understanding
by the Ministry of Education with Learning Machine Group, and
the European Target Institute set up by the Gaming Authority,
among others. A third of the respondents to the PWC survey

(2018) felt that Blockchain technology provides an opportunity
for their firm to take the lead. The local insurance sector seems
to be the most receptive to this new technology (PWC, 2018).
As the national policy and financial sector move towards
innovative technology and investments, human resource
professionals need to become part of the conversation in order to
step up and face these new challenges and create opportunities
for the workforce.
In conclusion, the financial services sector in Malta seems
to be undergoing a period of growth. Current research suggests
that human resources in the financial sector need to become
more proactive and shift away from traditional methods and
practices, towards more innovative approaches, to successfully
deal with the challenges presented. Rao (2017) describes HR
professionals as the backbone of any organization. He advises
that management needs to move from managing organizational
challenges to managing human resource challenges because
once human resource challenges are addressed, organisational
challenges will be overcome. Only then can we bank on success.
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Health care: Resourcing
Clinics and Hospitals
Miriam Dalmas
The health care system in Malta offers universal coverage to a

comprehensive set of services that are free at the point of use for
people entitled to statutory provision. Annual total expenditure
on health in Malta is consistently rising from year to year and
is approaching 10% of the national Gross Domestic Product
(World Health Organization, 2018a). Consequentially, Malta’s
government expenditure on health is also steadily increasing
and it is currently exceeding 15% of the total government
expenditure. Various factors are contributing to this escalation,
including the ageing population, emerging health care services
and investment in new medicines, innovative procedures and
evolving technologies. The annual national government budget is
surpassing 500 million Euros and more or less half of these funds
are spent on expenditures that are in the Government Financial
Estimates collectively listed under ‘personal emoluments’
(salaries and other personnel income) (Ministry for Finance,
2017). On the other hand, private spending contributes to more
than 30% of the total health expenditure and the public share
(almost 70%) remains notably below the EU average figure
(around 80%) (Gauci, England & Calleja, 2018).
The Ministry responsible for health is one of the largest

employers in Malta with more than 8,000 employees (mainly
members of the public service). In addition to a huge diversity of
professional health care backgrounds, the public health service
engages staff trained and specialising in other professional
disciplines such as engineering, finance and management
and various categories of support staff ranging from clerical
workers, to security and auxiliary staff. More than half of the full
complement of workers in the public health sector provide their
services in the major acute general public and teaching hospital
for Malta, namely Mater Dei Hospital (MDH).
Apart from the health workforce employed in the public
sector, several professionals are also either engaged with the
private sector or in self-employment on a full-time or a part-
time basis. Most of the qualified dentists and several primary
care doctors (general practitioners/specialists in family
medicine) work independently in the private sector. Pharmacists
are often employed in community retail pharmacies and by the
pharmaceutical industry. Furthermore, a considerable number
of the medical practitioners and allied health care professionals
employed by the public health care system are also working in
the private sector, most frequently on a fee-for-service basis. The
income from the latter activity often surpasses their earnings
from their salaried position in the public sector.
The vast majority of professional health care workers are
trained at, and awarded their first degrees from, the University
of Malta. Three university faculties are mainly involved: The
Faculty of Health Sciences offers degree programmes in
nursing and midwifery and in a wide variety of allied health
care professions. The Faculty of Medicine and Surgery teaches
medical and pharmacy students. The Faculty of Dental Surgery
trains students in the dental professions. These three faculties
have a substantial campus within the MDH footprint, for both
academic and clinical teaching and practice. They all offer an
increasing number of Masters and Doctoral programmes. The
Malta College for Arts, Science and Technology (MCAST)
Health care: Resourcing Clinics and Hospitals 435
plays an important role in training care workers and different

classes of clinical aides to the various health care professions.
It is also engaged in the training of nurses and professionals
in physiological measurements at the bachelor’s level. A new
medical school in partnership with Barts and the London School
of Medicine and Dentistry based in Gozo started operating in
2017.
Regulatory Councils
Qualified health care practitioners are registered with one of

the four regulatory professional councils established under
and governed by the provisions of the Health Care Professions
Act 2003 (HCPA) (Ministry for Justice, Culture and Local
Government, 2003). These include: the Medical Council for
the regulation of medical doctors and dentists; the Pharmacy
Council regulating pharmacists; the Council for Nurses and
Midwives for professionals in nursing and midwifery; and the
Council for the Professions Complementary to Medicine. The
latter currently encompasses 21 different groups of allied health
professionals. Additionally, since 2003, the Medical Council has
two Specialist Accreditation Committees that certify and register
medical doctors and dentists completing specialist training
respectively within different specialist registers. Presently there
are 51 specialist registers for medical practitioners and two
specialist registers for dental surgeons. Legal Notice 59 of 2018
introduced two new Specialist Accreditation Committees: the
new committee for nurses will oversee 18 specialist registers in
nursing; while the committee for midwives will administer six
specialist registers in midwifery (Ministry for Justice, Culture
and Local Government, 2018). Ongoing development is also
being undertaken with the aim of eventually also introducing
specialist registers for other healthcare professional groups.
This chapter
This chapter enlists, illustrates, discusses and analyses a number

of reforms and changes that took place in the resourcing of health
care clinics and hospitals in Malta over recent decades. Two
outstanding events helped shape the health care sector in Malta
during this period: the country’s accession as a member state of
the European Union (EU) in 2004; and the construction of the
new Mater Dei Hospital. This new hospital started to operate
as the major public acute general and teaching hospital in 2007.
In 2015, the Sir Anthony Mamo Oncology Centre (SAMOC), a
new complex built with EU co-financing and also situated within
the grounds of MDH, took over the management of cancer care
services for the population in Malta.
A number of changes preceded and followed as a result of
the attendant reforms and developments that were triggered
and impacted inter alia by these two events. These reforms
had profound effects on several aspects associated with the
composition and function of the human resources engaged
in the health care services provided in the Maltese Islands.
These included recruitment and training, working conditions,
industrial relations and safeguards, specialisation, continued
professional development and opportunities for access to
corresponding professionals and expertise in other countries
(especially within the EU).
Trends in the complement of the health care workforce
Physicians
Up to, and at the start of, the 21st century, Malta suffered a
persistent shortage of physicians especially in the junior and
middle grades as a substantial proportion of newly qualified
doctors spent a number of years overseas carrying out higher
specialist training. The number of consultant physicians was
also below the average for Western Europe. The volume of
new students accepted at the medical school was capped by a
numerus clausus. However, this restriction was stopped in the

late 1990s, and the annual number of recruited medical students
more than doubled over the following 10 years.
At the end of 1998, there were 260 physicians per 100,000
inhabitants in Malta. A number of developments took place in
the first decade of this millennium that helped towards gradually
improving this ratio. The implementation of a mutual recognition
agreement with the UK General Medical Council (since most
medical graduates undertook their specialist training in the UK)
and the setting up of a UK Malta Foundation School in 2008-2009
were key to the increasing retention of new medical graduates
in Malta. On the other hand, the setting up of formal specialist
training programmes that are mostly carried out in Malta with
pre-determined fixed periods of overseas training was essential
to counteract the medical brain drain that was forecasted to take
place after accession to the EU. By 2010, the number of practising
physicians per 100,000 inhabitants in Malta had reached 308.1
(EU average 322.0) and by 2013 it surpassed the EU average to
reach 346.3 (EU average 336.5). About two thirds of physicians
work in the hospitals while the general practitioner to specialist
ratio has declined over time.
Nurses and midwives

Reporting on the number of nurses and midwives up to the late
1990s was known to be affected by several inaccuracies. The
profession was also impacted by a high proportion of inactive
(and mainly female) members who tended to avail themselves
of long career breaks and frequently did not return to take up
the profession. Reporting improved especially following the
setting up of the Directorate for Nursing Services in 1996. From
2009 onwards, published records refer to nurses and midwives
employed in both state and private health care facilities. The
number of qualified nurses remained persistently below the
EU average until 2015 when the number of practising qualified
nurses and midwives per 100,000 inhabitants reached 840.3 (EU
average 815.3). In spite of these increases, the ratio of nurses
to medical doctors has dropped and now stands at about 2.5:1.

Since 2008, the number of local nurses needed to be regularly
supplemented with the recruitment of nurses from overseas
(amounting to about 10% of the nursing workforce). The
provenance of these nurses tends to change over time and ranged
from Eastern Europe, to non-EU nationals and more recently to
southern European countries such as Spain and Italy. Nurses
and midwives are supported by and supervise different classes of
care support health care workers especially in basic nursing and
patient care. These health care workers were introduced in the
early 1990s with the aim of allowing the nursing and midwifery
professionals to concentrate on the delivery of care services that
necessitate their specialised expertise.
Dentists
In 2016, there were 47 practising dentists per 100,000 inhabitants.
This rates Malta as one of the EU member states with the lowest
per capita availability of dentists. The EU average in 2016 was
approximately 78 per 100,000 inhabitants. Entry for training
as dental surgeons is still limited by a numerus clausus. The
justification for the retention of this restriction is based on the
limited number of training facilities. Entry for training starting
in 2018 was capped at a maximum of 20 new students: 15 EU/
EEA students and 5 non-EU/EEA students (University of Malta,
2018a).
Pharmacists
In contrast to the volume of practising dentists, the number of
practising pharmacists is well above the EU average. In 2015, it
was the highest in the EU, at 129.2 per 100,000 inhabitants, while
the EU average stands at below 90. Pre-2014 reported figures are
known to have been hampered by several inaccuracies and are
therefore considered unreliable. However, the demand at the
national level for pharmacists is still higher than the supply of
these professionals. Attracting and retaining pharmacists by the
public service is an ongoing challenge. Demand in the private
sector is influenced by, inter alia, the need for community

pharmacies to have a qualified pharmacist present at all times
and the growing pharmaceutical industry in Malta.
Allied health professions

The allied health professions group incorporates professionals
that are distinct from nursing, medicine, dentistry and pharmacy.
This large category of health care professionals covers a wide
range and disparate groups of health care disciplines. The largest
groups comprise the medical laboratory scientists, radiographers
and physiotherapists. Other groups include audiologists, dental
hygienists, dental technologists, dieticians, medical physicists,
occupational therapists, optometrists, orthoptists, podiatrists
and speech and language pathologists. All these professions are
regulated by the Council for the Professions Complementary to
Medicine (CPCM).
A Directorate for Allied Health Care Services (DAHCS) to
coordinate this diverse group was set up in 2010 within the
Ministry for Health. This Directorate manages the functions of
all the above professional groups as well as the activities of other
care professionals that are not regulated by the CPCM. These
include psychologists, counsellors and social workers working
in the healthcare services. Figure 1 shows the number of public
officers by professional group within the remit of the DAHCS
in 2018. Additionally, DAHCS is also entrusted with the task of
administering the activities of several different groups of health
care workers that are collectively included under the term “Allied
Assistants”. These health care workers are trained in specific
disciplines to support and work under the supervision of almost
all the different classes of the allied health professionals.
The number and magnitude of allied health professional
groups is bound to keep on increasing with time, together with
the need to highlight areas that require additional investment
to introduce new functions and expertise or to increase the
available supply because of inter alia increases in the demand
for specific groups. Notable examples include the conversion
in 2010 of the bachelor’s degree in radiography to a dual

qualification whereby radiographers started to be trained in both
diagnostic and radiotherapy or therapeutic delivery (previously
training was separate) and the development of a Master’s degree
in medical physics in 2012. Both of these developments were
needed to respond to the increasing demand and sophistication
of cancer care services. These initiatives were carried out
through collaborative efforts between the Ministry for Health,
the University of Malta and selected foreign academic and
clinical partner institutions. More recently, similar initiatives
have started being implemented with regards to optometry,
orthotics and genetic counselling. The latter will constitute the
introduction of a new class of allied health care professionals.
Allied Assistants
Audiology
Clinical Perfusion
Decontamination*
Dental Hygiene
Dental Surg Asst**
Dental Technology
Dietetics
ECG Technology
Med Lab Science***
Medical Physics
Nutrition
Opthalmic Support
Orth & Prosth‡
OT‡‡
Phlebotomists
Physiotherapists
Podiatry
Psychology
Radiographers
SLP‡‡‡
Social Workers
Figure 1: Number of public officers by professional group within the remit of the
Directorate Allied Health Care Services (Personal communication, 2018)
*Decontamination technology; **Dental Surgery assistants; ***Medical Laboratory Science; ‡Orthotics &
Prosthetics; ‡‡Occupational therapy; ‡‡‡Speech language pathology
Developments in the training, specialisation and work

practices of the health care workforce
Several quality improvements have taken place since 2000;

they can be linked to the processes undertaken in preparation
for and subsequent to Malta’s accession to EU membership in
2004. The need for a number of reforms and developments had
already been identified in the pre-accession consultation rounds.
Various opportunities and challenges that presented themselves
or could be envisaged to arise following membership in both the
short- and medium-term could be identified.
Adaptation and adoption for implementation to the local
context of the existing and upcoming relevant EU legislation and
practices in the field of health are considered by many as key
to several of the developments that took place since the start of
the 21st century. In several cases, it provided the ‘solid bedrock’
required to counter local resistance and limitations such as ‘turf
protection’, non-existence of the necessary structures and lack of
resources. It is widely felt that, without the presence and need to
adapt and adopt to EU requirements, such changes would have
taken longer to implement and would have faced a steeper uphill
struggle.
The Health Care Professions Act

A major and early result was the publication of the Health
Care Professions Act (HCPA) in November 2003 (Chapter 464
of the Laws of Malta). This legislation repealed several of the
provisions that had been legislated through the Medical and
Kindred Professions Ordinance, originally enacted in 1901.
Successive legislatures failed to carry out the necessary reforms
notwithstanding the decades-long and well-known need to
modernise and reconfigure the medical profession’s regulatory
and training frameworks (Buttigieg, Grech & Azzopardi- Muscat,
2017). EU accession was indeed instrumental to bring about this
legislative overhaul so that Maltese law became compatible with
the EU acquis communautaire on training and member states’
mutual recognition of professional qualifications (Deguara &

Azzopardi Muscat, 2002). The HCPA sets about recognising the
number and different types of health care professions in Malta
and regulating their respective practices. This Act also provides
for the criteria and processes governing the recognition of formal
qualifications and acquired rights of health care professionals
to practise in Malta and in the other EU member states. It also
established the structures and processes for the recognition of
medical and dental specialisations. A 2018 addition concerned
new provisions for structures and processes for specialisations
for nurses and midwives.
Planning for, implementing and recognising formal
specialist training programmes for both the medical and dental
professions and the setting up of the respective Specialist
Accreditation Committees (SAC) were major reforms that
started to be implemented in 2003 (soon after the HCPA was
enacted). Another early deliverable was the publication of a
Framework for Specialist Training Programmes (2003). This
framework introduced rules and requirements for the design
and resourcing of training committees and programmes that
were to be provided in institutions based in Malta. The first
structured post-graduate specialist training programmes started
to function in 2007. The SAC is responsible for the maintenance
of the standards of each specialist group through work that
involves the development, updating and assessment of specialist
training programmes; the issue of the Certificate of Completion
of Specialist Training (CCST) to newly registered specialists; the
issue of the Certificate of Completion of Basic Specialist Training
(CCBST) to trainees that have completed the first two years of
basic specialist training; and the development of Continued
Professional Development (CPD) of the registered specialists
(Ministry for Health, 2009b). The CCSTs issued in Malta are
recognised in the other EU member states. Important sources of
guidance for the SAC are the EU Directive 2005.36.EC (regulating
the mutual recognition of qualifications) and the European
Union of Medical Specialties (UEMS). The membership of the
SAC includes recognised specialist associations in Malta. Post-

graduate training coordinators for the different specialities were
first appointed in 2008. The SAC was also tasked to prepare
regularly updated specialist registers for publication by the
Medical Council.
Recognition of specialisation in other health care professional
groups such as in pharmacy, nursing and the allied health
care professions is taking longer to establish and these delays
are affected by the absence of parallel developments for these
professional groups comparable to those in the medical and
dental fields at the EU level. Work is ongoing to establish
applicable structures, policies and procedures in the nursing and
allied health fields in Malta as attested by the recent adoption of
LN 59 of 2018 emanating from the HCPA. Malta can therefore
be viewed as a ‘pioneer’ in these endeavours.
Reversing the medical “brain drain”

An increasing net outflow of mainly newly graduated and
junior medical doctors was experienced especially to the United
Kingdom (UK) following the accession of Malta to the EU in
2004. Traditionally Maltese doctors travelled to the UK for their
specialisation training. The outward migration of other health
care professional groups was much less remarkable (Azzopardi-
Muscat et al., 2017).
For several reasons, a substantial proportion of the training of
most of the medical specialists in Malta needs to be conducted
overseas. The extent of the training time that needs to be
spent abroad, and the content of this overseas training, vary by
speciality and over time. For example, new and emerging medical
specialities or specialities that do not have an adequate number
of local trainers to assist in the specialist training programme will
require longer stints of training in foreign centres of expertise.
From time to time, the service also identifies the need to send
Maltese trainees (in this case, these are more frequently already
registered specialists in their field) to do specialist training in
a particular area such as when the service intends to introduce
new technologies and techniques in the diagnostic or therapeutic

interventions on offer in the local public health care package.
A considerable inherent risk of “brain drain” is associated
with these training abroad opportunities. Several successful
Maltese trainees were enticed to extend their stint abroad and
eventually chose not to return to work in Malta. Over the past
few years increasingly successful models aimed at retaining and
re-attracting these trainees and specialists have been adopted
while also resulting in added mutual benefit for the overseas
accepting training institution. These include formal agreements
with specific NHS Trusts whereby an increasing number of
specialist trainees training in several different disciplines are
hosted by different hospitals within the geographical remit of the
partner NHS Trusts. Another successful strategy is to continue
paying the trainee her/his regular salary while s/he is spending
time on training in a foreign hospital. In this case, the trainee will
not be an additional financial burden on the accepting institution
and the latter may actually benefit from having additional
supernumerary specialising medical professionals on their team.
This strategy also effectively ‘binds’ the trainee to return to work
in Malta following the end of her/his time abroad and has helped
towards the success of these ‘hybrid programmes’ (Buttigieg,
Grech and Azzopardi-Muscat, 2017). Furthermore, the specialist
training programmes are designed to ensure that the CCST is
only issued by Malta as the trainee is required to spend her/his
last few months of specialist training (usually around 12 months)
working in Malta prior to certification.
A Post-graduate Medical Training Centre (PMTC) was created and
launched in June 2008 and is based at MDH. This centre was created
to provide training, facilities (including access to communication
technologies that ensure connectivity with international affiliations)
and professional support for post-graduate medical trainees and
their trainers in the various specialities (Ministry for Health, 2018c).
The centre manages two main types of organisational structures for
training: the Malta Foundation Programme and the different medical
speciality training programmes.
Medical Foundation Programme

In 2007, the United Kingdom (UK) introduced new eligibility
criteria for entry into medical specialist training programmes
within its territory. These eligibility criteria required applicants
to follow and complete a two-year Foundation Training
Programme after graduating from medical school and prior
to applying for enrolment into specialist training. The first
foundation programmes in the UK started in 2007. As a result,
more than a half of the new medical graduates from Malta for
2008 ended going to the UK straight after completion of medical
school. Malta faced a massive shortfall of available housemen
(junior doctors) for its hospitals as a result of this ‘mass exodus’.
A number of reforms had to be implemented within a short time
frame with the objective of retaining and re-attracting these
young graduates and stem the ensuing “brain drain” (The Malta
Independent, 2006).
The main initiative involved the setting up of the Malta
Foundation Programme (MFP). The Maltese programme is
affiliated to the UK Foundation Programme (operations are based
on the same Reference Guide and offers the same curriculum
and educational and training opportunities as the official UK
Foundation School) and started to operate in July 2009 (Ministry
for Health, 2009a). Affiliation is renewed periodically, and the
latest re-affiliation certificate extends until 2022 (Ministry for
Health, 2018b). The MFP succeeded in stemming the flow of
new medical graduates leaving Malta within a relatively short
time. The outflow had reached 60% in 2007 and this had dropped
to 10% by 2011. Furthermore, the MFP started to attract an
increasing number of trainees that had graduated from foreign
medical schools (The Malta Independent, 2011).
Collective agreements
Other important developments included the recurring re-
negotiations of different health care professional agreements
over the past decade. These collective agreements resulted in
incrementally and substantially improving the remuneration
packages and the professional employment status of the different

health care professional groups. These re-negotiations were
spearheaded by the collective agreement for medical professionals
negotiated with the Medical Association of Malta during 2007
and finalised in January 2018. This agreement involved doctors
working in the public sector, introduced allowances for training
duties within structured training programmes and markedly
increased the salaries of medical consultants with a view of
enticing them to forfeit their private practice (Times of Malta,
2007). The latter, however, did not have its full desired effect
because the potential private practice income far outweighs
even the increased salary for public health care employment. As
a result, the number of medical professionals opting to sign up
to an employment contract that prohibits them from pursuing
private practice is much smaller than expected.
Collective agreements also introduced new concepts
whereby different trainee levels became better assimilated in
the employment structures. This concept eventually started
to be emulated in the collective agreements for other health
care professional groups and for professional groups outside
the health sector. A notable example was the establishment of
new recruitment call procedures at the higher specialist trainee
(HST) level. Previously calls were only issued for enrolment at
the start of specialist training or basic specialist training (BST)
level and at the completion of specialist training or resident
specialist (RS) level. The HST calls aimed at retaining trainees
that have completed their BST level training (the first two years
of the specialist training programme) in Malta and was initially
aimed at enticing the return of the medical professionals who
had moved to the UK in around 2018 to conduct their whole
post-graduate training overseas.
The nursing and allied health professions

Nursing professionals account for the largest segment of the
health care workforce. They are the backbone of the health care
system and are the foremost player in the attainment of high
quality, effective and efficient health care. In the acute sector

they are the professionals who provide 24-hour care and support
to patients. “When other health professions have left for the day,
nurses are still providing care and support to patients’ needs”
(International Council of Nurses, 2018, p. 43).
Nursing education in Malta started to be revolutionised in
the late 1980s with the conversion of the then Nursing School
administered by the Medical and Health Department to a
department within the Institute of Health Care (IHC) of the
University of Malta in 1987. In 2010, the IHC was awarded faculty
status and started to be called the Faculty of Health Sciences
(University of Malta, 2018b). In the process, nursing education
started to be offered at the tertiary educational level, followed
similar developments taking place in the UK and planned, from
the outset, to be compliant with the relevant EU legislation
concerning the recognition of professional qualifications for
nursing and midwifery (European Union Standards for Nursing
and Midwifery, 2009). In fact, the nursing element of the
university courses was originally planned and taught by graduate
nurse tutors brought specifically for this purpose from the UK
(The Malta Independent, 2012). Furthermore, courses for
enrolled nurses ceased to exist in 2003 and a conversion training
programme was organised by the Directorate for Nursing
Services within the Ministry for Health from 1998 to 2014. This
programme allowed these nurses to qualify for registration as
a state registered nurse (SRN). In the process, more than 600
enrolled nurses benefitted from this conversion initiative and
the proportion of enrolled to registered nurses in 2018 stands
at about 7%. A Higher Diploma in nursing studies is also offered
by the FHS.
Professional and practice development are also growing apace
with the academic development for nursing and midwifery. The
Council for Nurses and Midwives, as established under the
HCPA of 2003, introduced the issue of warrants for practice in
2009 (Ministry for Health, 2010). Other developments included
the introduction of a new employment designation in the form
of the post of practice development nurse (PDN) in 2002.

These nurses are selected to be role models to other nurses by
developing skills and capabilities, including participation in
projects, training events and research initiatives in liaison with
the PDN coordinator. These positions resulted in the recognition
of nurses with experience in a special clinical area and post-
graduate qualifications. They were also meant to propagate
the notion that nursing professionals should be integral to the
clinical multi-disciplinary (decision-making) team on patient
care, instigate and lead research initiatives and provide an outlet
for career progression without the absolute need to renounce
clinical status and duties for managerial ones. There are presently
around 80 practice nurses in the public health care service and,
following the collective agreement of 2013, these nurses have a
career pathway that can extend up to Scale 5 in the public service
(equivalent to the level of Assistant Director). These career
pathway progressions were eventually replicated in other health
care professional groups, such as pharmacists and AHCPs.
An evolution in the education of the allied health professions
occurred in tandem with that of the advancement in the nursing
education in Malta. In 1987, training which was managed by the
then Medical and Health Department started being organised
and delivered by the newly founded Institute of Health Care (IHC)
and later by the Faculty of Health Sciences (FHS) of the University
of Malta and bachelors’ degree programmes started to be offered
for most of the allied health professions. Presently, eight of the
twelve departments of the FHS are related to the different allied
health professions. The teaching departments for the various
professions are constantly continuing to expand their teaching
and research portfolios. All departments now have active
research programmes in various specializations, are active in
the provision of continued professional development training
and offer master’s and doctoral programmes for registered
professionals.
The demand for health care professionals is continuously
increasing in several countries as a result of several factors but
mainly due to the ageing population and the increasing capabilities

for diagnostic and therapeutic potential resulting from advances
in the acquired knowledge and technologies available in the
medical field. Another factor that is particular to the Maltese
context and more specific to the nursing complement is the
migration of most hospital services to a brand-new purposely
built hospital in 2007. At MDH the number of operating theatres
more than doubled and the number of wards also increased.
Furthermore, wards were generally designed to have a maximum
of 24-bed occupancy (whereas at St Luke’s Hospital they generally
contained 30 beds and most had the possibility for expansion to
up to 40 beds). This resulted in a substantial surge in the staffing
levels required especially for nurses on a daily basis.
Primary health care

The most frequent first point of contact for health care is through
the primary health care system. The services provided at the
primary health care level are designed to deliver comprehensive,
accessible and community-based care that meets the health
needs of individuals throughout their life course (World Health
Organisation, 2018b). A very wide spectrum of services from
prevention (such as vaccinations and screening programmes)
to management of chronic health conditions and palliative care
can be provided at the primary care level. Each service often
involves multi-disciplinary teams of health care professionals.
These teams are frequently based in health care facilities outside
the hospital setting or more directly within the community.
Globally, there is a growing realisation that family practice
is the key to effective, good quality health care. The standard of
primary health care in a country is a very sensitive parameter of
the medical services available. There is also a growing realisation
that primary care is becoming the key which dictates the size
and nature of hospital services. It is also perceived as indicative
of the quality of life that is provided to the “sick” (Soler, 2003).
In Malta, a comprehensive public primary health care
service is provided and administered from different facilities
but particularly from ten health centres spread across the

Islands. These facilities function as service provision hubs and
accommodate amenities for general practitioner and nursing
care, specialised services including immunisation, maternal
and child health and clinics for various groups of conditions
and the management of basic acute care (Ministry for Health,
2018d). However, it is estimated that the private primary health
care service accounts for about two-thirds of all the workload
in primary care at the national level. Several people choose
to pay out-of-pocket for primary care services in the private
service mainly because they are perceived as providing greater
convenience, continuity of care and individual choice of one’s
own family doctor, synonymous with general practitioner (GP)
and medical specialist in family medicine. Indeed, the European
Health Interview Survey conducted in Malta in 2015 showed that
60% of GP encounters are paid out-of-pocket (Gauci, England
and Calleja, 2018).
The setting up of a Department for Family Medicine within the
University of Malta in 2001 was a landmark event for education in
this medical speciality. Family medicine is nowadays recognised
as a distinct speciality and family doctors require specialist
training and registration to practice (Sammut, 2015). Specialist
training in family medicine in Malta started in 2007 with the
training of a number of GP trainers and the establishment of a
3-year intensive GP training programme. Within ten years 70
doctors have graduated from this programme. During 2017,
another 39 young doctors were currently in training (Sammut,
2018).
The primary care sector in Malta has been the subject of
several attempted reforms over the past 30 years. These reforms
can be divided into two main aim categories. One major aim is
to re-configure the public service by establishing some form of
patient registration to improve the continuity of care in both
the public and the private sector. The other major aim is to
incrementally increase the scope of primary health care through
inter alia the expansion of service provision, augmented
investment in infrastructure and equipment, and increasing

access to public health services by privately practising GPs. The
former (latest in 2009) were always met with stiff resistance and
were eventually abandoned. The latter are more successful and
have been taken up as the best avenue for progress in this sector
within the Maltese context together with ongoing efforts to
increase the interaction and integration between the public and
private providers. An additional development is the availability
of the electronic myHealth portal: https://myhealth-ng.gov.mt/.
This information platform provides medical professionals in the
private sector with relevant information in relation to the patient’s
health care episodes within the public system such as laboratory
results, radiology reports, case summaries or discharge letters
and information on upcoming hospital appointments.
An international study compared the strength of primary
health care systems operating in different European countries:
Malta placed highly in the areas of primary care workforce
development and coordination of primary care, whereas it
ranked rather poorly with respect to primary care governance,
economic criteria, continuity and comprehensiveness of primary
care provision, and access to primary care services (Kringos,
Boerma and Bourgueil, 2013).
Conclusion
The value of a sustainable health workforce that is responsive to

diverse population needs as well as demographic and economic
variations is increasingly recognised (Kuhlmann et al., 2018). In
Malta, health care is facing major challenges including changing
demographics, increasing demands and expectations, and rising
health care costs. On the other hand, the health system in Malta
was able to implement extensive reforms for its workforce in a
relatively short period of time.
Important demographic shifts are ongoing, both in terms
of the ageing of the population as well as in terms of flows of
migrant groups. In February 2018, the National Statistics Office

published a substantial revision of the population counts for the
time series from 2012 to 2016 (National Statistics Office, 2018).
In 2016, the official demographic statistics documented that the
population in Malta increased by around 55,000 people over a
span of ten years; the proportion of the population aged 65 years
and older was 18.8% while 17.0% were younger than 18 years
of age and the share of the population considered as foreign
amounted to 11.8%. Net immigration surpassed 8,000 persons
and the immigration ratio of EU nationals to third-country
nationals was around 2:1. In addition, over two million tourists
are being welcomed annually in the Maltese Islands.
The sustained, dynamic and significant net immigration flows
and the consequent unprecedented population growth is having
an impact on the demand for and use of the services provided
by the national health care system. Attendance records at the
Accident and Emergency (A&E) department of MDH show that
the percentage of visits by non-Maltese/foreign patients to the
total attendances for 2008, 2012 and 2017 was 10.2%, 11.8% and
17.5% respectively. The proportion of non-Maltese patients to
the total population attending A&E rose from 11.8% in 2008 to
20.2% in 2017 (Clinical Performance Unit at Mater Dei Hospital,
personal communication, October 2018). A comparable impact is
being registered in obstetric services. The percentage of deliveries
of non-Maltese mothers in the health care services in Malta rose
from 9.7% in 2008, to 12.0% in 2012 and reached 22.2% in 2017
(Gatt and Borg, 2018). Furthermore, the proportion of non-
Maltese persons to the total population requiring an involuntary
admission to a mental health institution amounted to almost 25%
in 2017 (Ministry for Health, 2018a). These evolving trends need
to be systematically monitored and comprehensively studied
so that appropriate developmental strategies that will allow the
services to continue to meet the changing need for health care
are designed, resourced and implemented.
Health systems can only function well when they are
resourced with the right number of health professionals for
a given population and that are equipped with the right skills
(Azzopardi-Muscat, 2016). In 2017, the European Regional
Office of the WHO published an in-depth review that explored
the concept of resilience of EU member states and especially of
small countries, and its implications for health at the individual,
community and system/societal level (World Health Organisation
Regional Office for Europe, 2017). Countries (and small nations
in particular) often encounter considerable challenges and
vulnerabilities when trying to reinforce the resilience of their
health systems and developing enabling environments that are
conducive to sustaining and developing their health workforce
(Azzopardi-Muscat et al., 2016). This chapter reviews how over
the last two decades, Malta has sought to improve the strength
and sustainability of its health system through various means
that included education and training, recruitment and retention
strategies, continuous professional development and the further
development and consolidation of the overall health system
governance. Several lessons have been learnt but perhaps the
most important is the need to retain and nurture the adaptive
capacity of the Maltese social, educational and health systems to
address multiple emerging challenges and opportunities in fast
evolving national, European and global contexts.
Acknowledgments
The author thanks the following for their invaluable and expert
input during the compilation of this chapter: Mr Ray Attard
Previ, Dr Natasha Azzopardi Muscat, Dr John M Cachia, Ms
Veronica Montebello, Mr Vincent Saliba, Dr Mario R Sammut
and Mr Jesmond Sharples. The usual disclaimers apply.
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pillar of health 2020 and the Sustainable Development Goals. Examples from the
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Available at: http://www.euro.who.int/__data/assets/pdf_file/0020/341075/
resilience-report-050617-h1550-print.pdf?ua=1
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Institutions
of Higher Learning:
From Diplomas to
Doctorates
Colin Borg
A performing organisation and its relevance to higher

education: a historical outlook
Managerialism, especially the ability to have the necessary

resources and to use resources in an optimal manner, is an
essential condition to steer HEIs towards the right direction and
for HEIs to become performance-oriented. Historically, from
a public sector perspective, performance management gained
significant importance in the post-1979 era when the New
Public Management (NPM) philosophy was conceptualised,
which essentially involved a series of business-like governmental
reforms that were aimed to render the public sector more
efficient and competitive in its resource use and service delivery
(Mackie, 2008, p. 12). De Boer, Enders and Schimank (2006)
described NPM as a vehicle towards modernisation in the public
sector, including universities.
The subject of performance management in public higher
education has been raised by numerous academics. Shattock
(2010) investigated the recipe for effective institutional
management. Saint (2009) emphasised the concept of
accountability and the role of institutional boards while Barzelis,

Mejerè and Šaparnienè (2012) explored the importance of
the administrative and academic functions, the reduction of
bureaucratic processes, the openness of the university, the
effectiveness of good communication and the management’s
understanding of the academic culture. When compounded with
financial responsibility, solid institutional values, strategic goals
and an entrepreneurial culture, a public HEI can be possibly
steered towards a performance venture.
Performance management literature in higher education
is increasingly topical. Benitez, Cruz-Castro and Menèndez
(2016), Sondari (2013) and Teir and Zang (2016) have proposed
a human resource model in higher education, exploring how
the regional policy environment is influencing human resources
management and by proposing a human capital measurement
framework as a basis for performance measurement. Theoretical
models have focused on the adaptiveness aspect of HEIs, on the
strategic shift from “ivory towers of yesteryear to managerial
business models” (Rowlands, 2017, p. 53) and on embedding
new styles of performance management in order to achieve an
agile, efficient and a better style of management (De Vries &
Álvarez-Mendoza, 2012).
Attempts to introduce performance appraisal in Malta’s public
service goes back to the pre-independence era (Warrington,
1993). The Public Service Reform Commission (PSRC) reform
report that followed in the early 1990s intended to inject a sense
of managerialism (PSRC, 1989, p. 2) in order for the public
service to become more responsive to changing needs and to the
rising expectations of the Maltese citizens (Thake, 2003).
The PSRC reform was built on key NPM components and
included five main facets: (1) the provision of high-quality
services that citizens value; (2) the injection of technological
resources; (3) managerial autonomy from central agency control
and the setting of organisational performance targets; (4)
maintaining the receptiveness to competition; and (5) investing
in human resources (Thake, 2003).
Higher Education: Managing Learning in Malta 459
Several reforms were undertaken as part of the PSRC reform;

but the first specific twelve key performance indicators (KPIs)
in the public sector were only launched in 2017. There is as
yet no national framework or institutional design to measure
performance in higher education. Most KPIs are created in a
sporadic and ad hoc manner. More time is required to build the
necessary expertise and to inspire an institutional culture that is
ready for a KPI-embodied framework. Data is difficult to acquire
and, when available, a thorough analysis had to be conducted by
the author to build a holistic picture. Despite these limitations,
the author presents various indicators both from a contextual
reality and an HR perspective.
Rankings are increasingly nudging HEIs to perform better
and to introduce performance measurements of their own;
these international benchmarks could determine the ability of
institutions to attract and retain international students. The
Shanghai Academic Ranking of World Universities and Times
Higher Education University Rankings are two of the most
influential and widely observed University rankings. U-Multirank
is also a useful tool, especially when considering that it is driven
from a user (student) perspective.
Rankings are a tricky international performance measures,
especially when considering the various criteria used to
classify HEIs. At times, the UM has yet to classify among the
top universities, as is the current case with the Times Higher
Education Rankings; but, on other occasions, 2018 U-Multirank
data suggests that UM’s ranking has improved considerably
since data started being collected (U-Multirank, 2018). The
UM’s Institute of Digital Games has placed among the world’s
top 25 in the Princeton Review (University of Malta, 2018).
All in all, the UM is ranked amongst the best 4% universities
in the world, when considering that the estimated total number
is over 28,000 (Webometrics, 2018). Nevertheless, the ability of
UM and MCAST to improve their ranking status is significantly
hampered by the limited research funding available; although,
even here, significant improvements have been made.
This argument brings us to another important consideration

of performance management. Performance indicators do not
necessarily reflect a precise and comprehensive scorecard.
Indicators can be a useful tool but are to be used with caution.
Because of index mania, university personnel sometimes try to:
quantify the unquantifiable; grapple with the lack of available
data; get overwhelmed by too much data and the hassle of its
collection; despair with the lack of central-local collaboration in
making sense of the available information, when and if collated
(Bezzina, Borg & Cassar, 2017).
A brief contextual outlook of Malta’s higher education realities
Malta’s current contextual reality exposes the complexity of

public HEIs and points towards an expanding role for governing
structures and management. The growing public higher education
sector, in terms of size, structures and departments is a major
determinant of the complexity to manage public institutions. In
terms of students, numbers tripled in 15 years: 6,360 in the year
2000 to 16,020 in 2015 (NCHFE, 2016). Some 13,180 students
are registered with public HEIs, a share of 82% from the total
higher education market (NCHFE, 2015). This number includes
both international and local students. With regards to staff, the
higher education sector employs a total of 2,689 employees in
accordance to NSO figures for Academic Year 2015/16. Public
sector employment amounts to 2,650 or 98.7% of total staff.
These figures show the large size of public higher education,
despite increasing competition from private HEIs. The larger the
size, the greater the tendency of having complex institutions.
Given the very small percentage of enrolled students and
graduates at level 5 upwards at the Institute of Tourism Studies
(less than 1% of global numbers), the focus of this paper is on
UM and MCAST.
Notwithstanding the large public share, the private sector
is growing rapidly and in a relatively short period of time.
The private market share, in terms of enrolled students, has

experienced a twelve-fold increase in just seven years, from 239
registered students in 2008 to 2,833 in 2015. The number of
private licensed institutions has also more than doubled, from 31
in 2012 to 73 in 2017 (NCHFE, 2015, p. 27). Competition from
private HEIs is increasing in an unprecedented manner. From a
total of 80 HEIs with a licence to offer courses at tertiary level in
Malta, 73 are private institutions. Nevertheless, UM offers some
700 programmes of study in most imaginable areas of knowledge
each year. Private institutions tend to focus on a much narrower
range of academic areas, such as business and management
studies, information technology and languages.
The growing relevance of public higher education is mainly
manifested in terms of student numbers; economic and financial
data fails to reflect this growth. This can be mainly attributed to
the fast-growing Maltese economy which has recently increased
at an average annual rate of 4-6%. The contribution of the overall
education sector to the Gross Domestic Product (GDP) is
merely 3% (NSO, 2018). The specific higher education share is
just 0.5% and the contribution of language schools to the GDP
is only 0.23%. The 40 language schools are considered as a niche
economic sector in Malta; they enrich Malta’s education sector
with many international students. Its economic benefits tend to
be spread all over the Maltese Islands.
Managing human resources in a performance-oriented

public higher education model
The fundamental question is how this evolving phenomenon

could be possibly managed in an increasingly competitive
environment that demands public HEIs to become performance-
oriented. The answer lies with effective resource management,
and involves a flow from: inputs (financial, human, student
and knowledge sources) to process (governance structures and
managerialism) and on to output and outcomes (short term
and medium term institutional and national results). The HR

function is critical in servicing both input and process. It does
so by: attracting and retaining smart and competent employees;
supporting their training and professional development; putting
in place an effective system of rewards and a performance
management programme; and mainstreaming mechanisms for
effective participation in decision-making (by academic staff,
administrative staff and students).
The focus of this chapter is on the process indicator: that
is, how human resources are being managed in order to be
geared towards a performance-oriented institutional culture.
Nevertheless, there is reference to the input indicator when
discussing the ability of HEIs to attract and retain staff.
Four main human resource indicators are reviewed. The first
indicator is the institutional ability to attract and retain human
resources in a highly volatile and turbulent labour market scenario.
The second indicator is the development of a holistic training and
development programme that provides the necessary knowledge
and skills for both staff and students in a highly sophisticated
institutional governing framework. The third indicator is the
design of a realistic and effective staff performance management
programme (PMP) that incentivise success stories. The fourth
indicator is the creation of participation mechanisms and the
encouragement of staff and students to actively participate in
institutional decision-making.
Attracting and retaining staff

This first fundamental human resources indicator calculates the
institutional ability to attract and retain employees. This indicator
does not discuss the quality of the human resource. It checks
whether HEIs have enough staff to fuel their managerial engine
in circumstances of increasing workload in terms of number
of departments, units, offices, collaborative arrangements and
networking opportunities.
Attracting and retaining employees has become a challenging
task in a scenario where unemployment has reached very low
levels. Malta’s unemployment level is 3.9% and is the fifth lowest

unemployment figure recorded in the European Union in May
2018 (Eurostat, 2018). Institutions try to adopt pay-related
incentives and other work-life balance measures to incentivise
employees to come or continue to work at their institution and
to strive towards achieving the performance indicators.
Table 1 reveals that, at the University of Malta (UM) for the
period 2011-2017, the ratio of employing new academic staff to
losing academic staff is on average 3:1. The calculated ratio in
terms of administrative staff is more volatile. From academic
year 2011/12 to 2013/2014, the ratio varied between 6.6:1 to
3.3:1; in the subsequent three years, from academic year 2014/15
until 2016/17, the ratio decreased to 2.1:1 and then to a low level
of 1.44:1. The volatility in the tight labour market is leaving its
mark on the university and, as a result, administrative staff are
leaving at an increasing rate.
Table 1: The number of staff joining and leaving UM.
Category/Academic
2011/2 2012/3 2013/4 2014/5 2015/6 2016/7
Year
UM Academic Staff:
160/50 112/49 183/49 138/46 105/33 96/43
New vs Left
UM Ratio Academic
3.2/1 2.3/1 3.7/1 3/1 3.2/1 2.2/1
Staff: New vs Left
MCAST Academic
Staff: New vs Left 3/0 0/0
(University College)
UM Administrative
and Managerial 197/30 267/59 192/59 233/110 216/150 237/120
Staff: New vs Left
UM Ratio
Administrative 6.6/1 4.5/1 3.3/1 2.1/1 1.44/1 1.98/1
Staff: New vs Left
MCAST
Administrative
8/0 1/0
Staff: New vs Left
(University College)
These figures and ratios demonstrate that the ability of UM to

retain administrative employees is weaker than with respect to
academic staff. This could be explained by externalities beyond

institutional control, such as project-based administrative staff
that are engaged on funded fixed-term contracts. However,
there is an evident discrepancy in the salaries and conditions
earned by academic and administrative staff that could explain
the differences in the figures, if analysed in a separate study. The
latest UM’s collective agreement for administrative staff, signed
in March 2018, involved a general average increase of 2.5% in
the salaries per annum that works out to a total of 13% over the
duration of the agreement: 2017-2021. The salary increase is
pegged to the wage levels of the public service; but it is only a
marginal increase when considering the robust labour market
that the university is competing in.
MCAST’s figures of staff joining and leaving its University
College (UC) are minimal given that the college has been
recently established. Figures show that the college commenced
in 2015 by deploying its then existing staff. The efforts of the
MCAST UC have been concentrated in employing new full-time
academic and administrative staff in order to sustain its growth
and service more than 2,000 tertiary level students.
There are other human resource indicators that can be
influenced by the HEIs themselves as a measure to retain
their employees. The costs of replacing a worker, in the form
of recruitment, selection, screening and learning on the job
are substantial (Dube, Freeman, & Reich, 2010). It is much
more cost-effective to devise employment conditions that are
conducive to work-life balance and to family-friendly measures
to retain existing employees.
Table 2 shows that work-life balance initiatives amongst
administrative staff at UM are still being availed of by a small
minority. An average of 12% are on a reduced hours arrangement,
normally of between 25 and 30 hours. The use of flexitime has
experienced a three-fold increase in just four years, from 2014
until 2018. Nevertheless, only 8.7% are making use of this work-
life balance arrangement. Teleworking is used by a mere 4% of the
administrative staff, although most administrative duties could
be easily conducted from home and quantified in accordance to

established benchmarks.
Table 2: The intensity of work-life balance initiatives at UM (administrative staff ).
Academic Year/ Work- 2014/5 2015/6 2016/7 2017/8

life balance initiatives
Reduced Hours 100 (12%) 100 (11.9%) 105 (11.8%) 108 (12.4%)
Flexitime 24 (3%) 17 (2%) 40 (4.5%) 76 (8.7%)
Teleworking 16 (1.9%) 25 (3%) 28 (3.1%) 35 (4%)
- Table presenting head count data and brackets showing percentage data
MCAST’s University College administrative employees are

all full-time staff and are therefore not making any use of work-
life balance initiatives that are allowable in terms of the College
collective agreement.
The issue of work-life balance is less prevalent amongst
academic staff, given their more flexible schedules. Academic
staff are not required to determine the time of entry and exit and
in most situations academic staff can schedule their lecturing
commitments in accordance to personal exigencies.
Training and Development: providing the necessary skills to staff

The second human resources management indicator is the
training and development of both administrative and academic
staff. In an era of a knowledge-based economy and a contextual
reality of tougher competition from the private sector stemming
from globalising influences, it is vital that staff with the necessary
skills is available in both the managerial and academic research
camps.
Training and development can be designed in-house to cater
for the specific exigencies of the HEI; or else is outsourced and
run by specialised agencies.
A training and development programme for administrative
staff at UM was launched in 2014. The in-house tailor-made
programme encapsulates various topics ranging from duties
related to the administration of students, marketing, knowledge
transfer, quality assurance in higher education and research

support services. Table 3 reveals that the number of training
sessions increased by 12 times in just three years and the
number of participants increased by almost six times. (Note that
some staff members may have followed more than one course).
In 2017, the number of participants was more than 51% of all
administrative staff. Training sessions are delivered by in-house
trainers with no additional cost to the university, except for the
time devoted to develop, plan and deliver the training sessions.
Table 3: Number of UM and MCAST training courses and participants

(administrative staff ).
Participants & Num- 2014 2015 2016 2017

ber of Courses /Year
Participants: UM Staff 77 284 290 446
(9.3%) (33.9%) (32.6%) (51.3%)

Participants: MCAST n/a 3 3 0
University College
Staff (37.5%) (33%) (0%)
Number of UM 3 19 25 36
Courses
Number of MCAST n/a 3 3 1
University College
Courses
MCAST in-house training sessions are focused on customer care

and a comprehensive induction course. Despite the low number
of administrative staff who work within the University MCAST
college (just nine employees), the participation rate in training
and development was at the same level as that of UM in 2015
and 2016: an average of 35%. The number of training sessions is,
however, very low when compared to that of UM.
In addition to tailor-made in-house training courses, staff can
also be encouraged to attend academic courses held externally
through the UM’s sponsorship of tuition fees. Table 4 shows
the low percentage rate of UM administrative staff that were
awarded a scholarship to pursue academic courses. In 2017,

less than 0.5% were following an academic course while being
sponsored. These figures and percentages do not include UM’s
initiative to offer study leave to administrative employees if they
are following an academic course at UM. Administrative staff
can avail themselves of a maximum of 8 days of study-leave
annually. In this case, the percentages vary from 20% to 25% over
the 2014-2018 period. These are significant percentages which
suggest that a good proportion of administrative staff is seeking
tertiary education in order to improve their career progression.
Table 4: Number of staff attending academic courses organised

by an external HEI but sponsored by UM.
Participants & 2014/5 2015/6 2016/7 2017/8

Academic Year
Academic Staff 79 76 68 58
Administrative Staff: 11 9 5 4
UM
(1.3%) (1.1%) (0.56%) (0.46%)
Administrative Staff: n/a 3 3 4
MCAST
(37.5%) (33%) (44.4%)
- No percentage data is showing for academic staff since most of the cited numbers
reflect specifically assistant lecturers who are contractually obliged to pursue a Ph.D.
degree
MCAST’s UC head count data is comparable to that of UM,

but is much higher percentage- wise, given the restricted number
of its administrative staff. It is encouraging to note that almost
half of MCAST UC administrative staff are attending courses
held outside the institution.
There are no MCAST UC staff attending professionally
designed courses outside the institution. The data for UM
academic staff is to be interpreted in a context where most of the
staff joining the University are already in possession of a Ph.D.
degree. Their interest is devoted to publishing in peer-reviewed
academic journals rather than pursuing an academic course. The

numbers cited in Table 4 pertain to the academic staff join UM
as candidates in possession of a Master’s degree and are legally
bound to obtain a Ph.D. degree within a period of eight years.
Performance-oriented job titles and performance management

programmes
A performance-oriented HEI mirrors two main facets in the
employment conditions: the transformation of job titles to
today’s exigencies and the development of performance-oriented
conditions. This third human resources indicator in Malta’s public
higher education revolves around the rise of professionalisation
and specialisation of managerial and administrative jobs.
The best tools to analyse the transformation of job titles, at
least on paper, are the institutional collective agreements. The
collective agreement for UM’s administrative, technical and
industrial staff for 2007-2011 led to a number of HR managerial
reforms: a performance bonus for leadership positions (those
who are at Scale 5); a performance allowance for specialised
technical jobs at the IT Services and SIMS Office who are at a
middle management or a leadership scale (Scale 8 to Scale 5);
training as an obligatory requirement for all administrative
staff; the rising importance of having qualified staff balanced
with experience as well as seniority; and the re-designing of
administrative jobs.
Traditionally, Malta’s HEIs relied on administrative jobs that
were transposed from the conventional public service stream:
such as clerks, executive officers, administrative assistants and
administrative officers. In the case of the University of Malta,
these job titles have been in existence for more than four
decades. MCAST modelled the administrative jobs on this
traditional approach despite being a relatively recent institution.
In time, these conventional posts were becoming increasingly
ill-suited to today’s higher education environment. A 2012
report emphasised that, given the forces of change impacting
significantly on the higher education sector, it was expected that
HEIs embark on a radical transformation of the business model,

and including a sober reassessment of how jobs are determined
(Ernst & Young, 2012, p. 15). Hammerschmid et al. (2013)
highlighted that management reform had to be modelled on a
goal oriented and performance management programme.
UM’s collective agreement embarked on a substantial reform
in job designs and nomenclatures, as portrayed in Figures 1
and 2. This was doable following extensive consultation with a
number of structural units across the University. Three main
HR developments followed from the reform. The first noticeable
development is the responsiveness and adaptability to the
contextual environment. The transformed new job designations
demonstrate this phenomenon through: the creation of child
care jobs to highlight the societal focus on providing childcare
to working mothers; information management specialists to
emphasise the ICT managerial revolution that was injected
through software licences such as AIMS and SIMS; and the
introduction of scientific officers, architects and civil engineers
and a decontamination officer in order to respond better to the
exigencies arising from the scientific world.
The second development draws a distinction between lower
and middle management vis-à-vis upper management. Lower
and middle managerial grades are given the titles of administrator,
while faculty officers will eventually be called managers. This
move is intended to instil a sense of ownership in steering and
managing a faculty rather than being purely administrators,
record-keeping officers.
The third development strengthens the idea of a specialist.
New specialised posts have been introduced not just in
the administrative stream but also in advisory services and
information management. In addition to the post of an
administration specialist, a counselling services professional and
an information management systems support specialist were
created for the first time. The tendency of creating specialist jobs
were a continuation of other specialist employments that were
introduced in the previous collective agreements such as student
advisor, childcare centre coordinator, health and safety officer,

IT specialist and IT systems engineer.
Figure 1: Transformed Job Titles at UM.
Clerk Administrator I
Executive Officer Administrator II
Administrative Assistant Administration Specialist
Administrative Officer Manager
Information Management
System Support Officer Systems Support Officer
Kindergarten Assistant Childcare Assistant
Counsellor Counselling Services

Specialist
Figure 2: New Job Titles at UM.
Information Architect and

Management Senior Scientific Civil Engineer and
Systems Support Officer and Senior Architect
Specialist Scientific Officer and Civil Engineer
Dental Surgery
Child Care Centre Assistant and Decontamination
Coordinator Senior Dental Officer
Assistant
The criticism directed at this reform is that more could be

done in this area especially when considering the complexity
and diversity of the University’s units. Other job designations
– such as student welfare officers, quality assurance specialists,
programme and timetabling managers, faculty managers and
certification officers – could have been introduced in order to
strengthen the University’s administrative positioning. Despite
these limitations, it is to be noted that the number of job titles
is almost three times as much than that of MCAST: 67 versus
23. This could be explained by two main variables: first, UM’s
organisational chart is by far more complex than that of MCAST
and the modernisation of MCAST’s administrative structure
from an HR dimension is still in its infancy.
In addition to more specialised posts, the delegation of
authority and responsibilities from the central administration to
the faculty level is also essential. HEIs that offer their services to
thousands of students are required to move away from too much
centralisation if they are to be effective and efficient. Examples
of delegated jobs at Faculty or Institute level could be human
resources managers, finance managers, and communications
and marketing managers.
Specialised employment designations are to be boosted by
performance management programmes if HEIs expect their staff to
work collectively and individually towards achieving performance
indicators. Performance related pay for administrative staff at
UM has been in existence since 2009 through contract-based
senior executive staff that enjoys a performance bonus of 20%
of the annual salary as well as other work resource benefits and
communication allowance. As from 2017, the performance
bonus was introduced for indefinite staff within the framework
of the collective agreement. Administrative staff at salary scale 5
is entitled to an 8% annual performance bonus while IT related
specialised staff enjoys a performance bonus that ranges from 5 to
10%, depending on the salary scale. The total number of university
administrative staff on a performance bonus is 81. Percentage
wise, it is only 9% of the total staff.
Performance related conditions for UM academic staff

are less visible and more complex to decipher. The collective
agreement, composed of 89 pages, mentions performance only
four times in a vague manner. Performance is strictly specified in
connection with the criteria for promotion, the research output
and the academic effort for research. In practice, performance is
concentrated in effort for teaching, research and administrative
duties. It is a measurable tool that, in most instances, is criticised
by the academic community as trying to count the uncountable.
The consequent setback is the overemphasis on those services
that can be counted. The fact that there is no official identifiable
common measurable academic effort may leave room for
interpretation and misconception.
A performance management structure is until now
absent at MCAST and is not mentioned in the academic and
administrative staff collective agreements. Performance related
conditions are only available to six Deputy Directors who enjoy
a 10% performance bonus. The Deputy Directors are involved in
the general managerial duties of MCAST and are not exclusively
related to the University College. When considering a total staff
complement of 739, the percentage rate of MCAST that are
involved in a performance related pay is only 0.8%.
The level of participation during elections
The fourth human resources indicator of performance in an

HEI, is based on a shared governance approach that is required
to be developed through a structural arrangement based on a
relationship between the central administration, the faculties,
staff and students.
Birnbaum (2004) argues that shared governance is a way of
inviting all those with the necessary expertise in an organisation
to participate in its governance. If this is not done, levels of
inclusiveness and satisfaction are likely to be low. The ultimate
effect would be that staff does not feel part of the institutional
decision-making process. Such a scenario demotivates

employees from working towards securing the institutional
objectives and leaves a detrimental impact on the efforts of HEIs
to be performance oriented.
In practice shared governance requires decentralisation and
delegation of powers from the centre to the faculties (Arntzen,
2016); but it also involves a sophisticated liaison between the
local faculties and the central committees and boards. A working
channel is to be complemented by effective representation
by those who are elected. Shared governance and managerial
leadership at all levels help HEIs to adapt to the complex
environment and provide a platform for institutions to embrace
change and be able to learn, innovate and perform (Wallin, 2010).
There are various channels of staff participation in decision-
making that are of an active and passive nature. This section
focuses on one of the channels: participation during elections.
Academic staff participation during Council elections at UM,
as shown in Table 5 is relatively low, although there has been
a significant increase when comparing the period 2010 to 2014
and 2015 to 2017. The percentage rates in the first period vary
between 7% and 19%, while in the second period under review
the rates increased to a bracket of 25% to 35%. This significant
increase can be explained by the introduction of online voting.
Participation from administrative, technical and industrial
staff is only possible in Council elections. The percentage
rates vary between 38% and 63% and from a total of 16 council
elections that were held in this period only once, in 2013, was
a percentage rate of over 50% participation registered. This
means that, in almost all elections, the absolute majority of staff
is not even passively willing to be involved in decision-making by
participating in elections to elect their representatives.
The participation of academic staff with regards to faculty
representation on Senate is much weaker than Council
elections. In the period 2009-2018, from a total of 66 election
opportunities that could possibly be held at a Faculty level to
elect Senate representatives, only 12 elections were actually held.
In the remaining 53 cases, no election was held since only one

representative from each Faculty was nominated. These figures
show that, in 81.5% of circumstances, no election was held.
Table 5: Academics and Non-Academic staff turnout during Council elections at UM.
Year/Percentage 2010 2011 2012 2013 2014 2015 2016 2017 2018
of Voting
Council Election 214 151 272 100 255 401 583 486 n/a
(Academic (11%) (18%)
Representatives) – (18%) (7%) (16%) (25%) (35%) (29%)
Number of Votes 279
& % voting
(19%) 521 580
(32%) (35%)
Council Election n/a n/a 357 512 401 393 n/a n/a 432
(Administrative/
Technical/ (48%) (63%) (39%) (38%) (39%)
Industrial
Representatives) –
Number of Votes
& % of voting
- n/a denotes that no election was held in that particular year
Table 6 presents headcount data and percentage figures

whenever a Senate election was held. The rate of participation
varies from 20% to 84% and on average is higher than Council
elections, given that these elections are held at a faculty or
institute level and so academic staff tend to associate more with
the prospective representative. This shows that, when elections
are held at an institutional level, staff feels disconnected from
participating. Furthermore, the rate of elections has increased
between 2016 and 2018: 2-3 elections are held each year. Up
to 2016, around one election was held annually. This suggests
that interest in decision-making at the highest echelons of the
University may be growing.
Table 6: Academic staff turnout during Senate elections at UM.
Year/Number 2009 2012 2013 2015 2016 2017 2018

of Votes &
Percentage of
Voting at Faculty
Level
Information & 27 28 39 31
Communication (68%) (58%)
Technology (74%) (61%)
Medicine & 62 69
Surgery
(41%) (20%)
Built 41
Environment
(84%)
Health Sciences 43
(31%)
Economics, 65
Management &
Accountancy (47%)
Science 49 33
(80%) (52%)
Social Wellbeing 48
(58%)
Institutes, 23
Centres &
Schools (68%)
Table presenting head count data and brackets showing percentage data
- Figures are specified only when an election was held
There are no MCAST staff elections specifically for the

University College. Elections for lecturers and students are
held for the respective Institute’s Board of Studies by electing
one lecturer and one student per institute and on the Council
of Institutes by electing two lecturers and two students chosen
from among all lecturers and students. MCAST figures of staff
participation, as shown in Table 7, are in the same bracket as
those registered at UM. The percentage figures recorded in 2012
and 2013 are around 24%; while in 2014 the rate of participation
increased to 35%.
Table 7: Lecturer turnout during MCAST elections to Institute Councils.
Year/Percentage of Voting 2012 2013 2014

Election for Lecturer Representatives: 92 99 160
Number of Votes
% of those eligible voting 23.8% 24.3% 35.4%
The effectiveness of participation in institutional decision-

making is also influenced by the size and composition of the
governing boards. Australian, UK and US board compositions
show that, in line with the corporate world, the average board
has between nine to fifteen members and operates a bicameral
governing structure (Rowlands, 2017).
The UM Council is the University’s highest-level governing
body. It is currently composed of thirteen academic and non-
academic staff, three student representatives and seventeen
external members (including its President), working outside
of the University and all but one of whom are appointed by
the Prime Minister (the other is appointed by the Minister of
Education). This entails that, percentage-wise, only 9.1% of the
Council’s composition is made up of student representatives
while 39.4% of the Council members represent the academic,
managerial or technical side. The remaining 51.5% are external
members appointed by Government to represent the wider,
public interest. This may inhibit UM’s effectiveness at being
autonomous, especially when taking crucial Council decisions
concerning its way forward.
Senate is represented by 36 (83.7%) staff members of the
University; an additional 2 (4.7%) members who work outside
the University represent the Minister of Education; and the
remaining 5 (11.6%) are student representatives. Therefore, when
compared to Council, the composition of staff representation
on Senate is much stronger and the percentage of student
representation is also higher.
There is no student representation on the Board of Governors

of MCAST, which is its highest-level governing body. This Board
is composed of seven external members representing the public
interest and only one internal member who is the president
of the Board of Governors. Over and above these permanent
members the principal, the chief administrative officer and the
deputy principals responsible for curriculum, quality assurance
and continuous professional development are often asked to
attend. This entails that although the Board of Governors is
mainly composed of external members, the contribution of the
internal members is a significant component of this board even
though they are not permanent and official members.
Conclusion: Towards a national KPIs framework
Effective human resources management is an essential element

of a performance-oriented HEI. The human resource indicators
assessed in this chapter hint at three main conclusions.
First, there has been an attempt to introduce diverse human
resources measures, ranging from training to performance-related
working arrangements, but the fundamental problem is that these
measures do not form part of a holistic framework. Most of the
measures were introduced in an ad hoc manner without studying
the consequences on the entire institutional management.
National statistics on human resource indicators are not available
and institutions are still struggling to collect and most importantly
analyse the data available. Hence, the very foundation of having
a performance oriented institutional culture is in jeopardy.
Without the design of a human resource performance-based
vision, the managerial engine of HEIs will be ill-prepared to face
the challenges of higher education. Malta’s public HEIs still have a
long way to go in order to be ready for the eventual introduction
of a national and an institutional KPI framework.
Second, the realities faced by the University of Malta are
by far larger and more complex than the relatively smaller
University College within MCAST that was only launched in

2015. Despite an increasing competition from the private sector,
UM has held on to a considerably large market share. MCAST
has also a substantial share that is larger than the marketshare of
the private institutions altogether, but is still relatively new in the
tertiary sector. Therefore, any comparisons made have to keep
this important detail in mind.
Third, the study of performance management involves a
plethora of indicators. Most of the indicators have to be analysed
by considering the contextual realities and the complexities that
exist in the public sphere in order to gather a comprehensive
analysis. This could be a fascinating separate exercise, keeping in
mind the eventual introduction of a University of Malta Act that
has been in the pipeline since 2015. The proposed Act could bring
about significant changes in terms of governing arrangements
which are bound to influence UM’s managerial processes. If
the University Act is introduced, it would be interesting to see
what would happen to the general Education Act and whether
it leads to other institutional specific acts, especially with regard
to MCAST.
Acknowledgements
I thank the Office for Human Resources Management &

Development at the University of Malta (UM), the Human
Resources Office at the Malta College for Arts, Science &
Technology (MCAST) and the National Statistics Office (NSO)
for kindly providing me with the data that populates the tables in
this chapter. The usual disclaimers apply.
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Advisory and
Consultancy Services
Maria Bartolo Zahra and Joseph F X Zahra
Mega trends in Human Resources
We cannot address the question on how we will design a

company’s HR function and the need for HR advisory and
consultancy services without considering the far-reaching shifts
that have taken place in business over the last five decades.
We have moved from economies depending predominantly
on manufacturing and agriculture to ones driven mainly by
services, including knowledge based and creative activities. This
is the history of transformative economies and the way they
translate into social and cultural anthropology: the agricultural
age (farmers, breeders, herders) into the industrial age (factory
workers), into the information age (knowledge workers) and the
present conceptual age (the creators and empathizers) (Pink,
2006). The focus is on the ‘value added’ primarily generated by
machinery (in the industrial age) and now by human brains and
activity while manipulating electronics (technology, computers,
internet, artificial intelligence, robotics). What we refer to as
‘human resource’ has also changed its nomenclature from that
of ‘personnel’ to ‘HR’ to ‘talent’ and now ‘people’. Workers and
employees are now often seen and presented as ‘collaborators’

in an environment of flat, lean and agile organisations, with
“managers” that ‘lead and enable’ rather than ‘command and
control’, and with networks of teams that are aligned together
and expected to be accountable for their results.
Drucker and Ulrich
This paradigm shift has been taken up by two thinkers of

management and leadership: Peter Drucker and Dave Ulrich.
Drucker (2002, p. 70) sees HR as the “source of competitive
edge”; the effect of a huge shift that has taken place: “in traditional
workforce, the worker serves the system; in a knowledge
workforce, the system must serve the worker.” The person
working in business is now the “major creator of wealth and
jobs… the challenge is to make ordinary people do extraordinary
things”.
During most of the twentieth century, personnel management
was dominated by the principles of Taylorism (also known as
‘scientific management’) and its objective of improving labour
productivity via the rigorous engineering of work settings and
human effort; as well as Fordism and its objective of securing
efficiencies through mass production: workers were expected to
come with their muscles to work, and to leave their brain outside
the factory. That brain could easily be contaminated by ‘socialist’
ideas and could fall under the influence of trade unions. Today,
the situation has been completely reversed. The business owner
is calling out for the brains, and not the muscles. The muscles
have been substituted by technology.
Likewise, Ulrich (1998, pp. 124-134) reflects the mood of
this shift by giving four ways by which HR functions in business
can be the driver of what he terms “organisational excellence”:
namely, that HR becomes: a partner with management in strategy
implementation; an ‘expert’ in the organisation of work, aiming at
improved efficiency, cost effectiveness and quality sustainability;
Advisory and Consultancy Services 483
a “champion for employees, vigorously representing their

concerns”; and “an agent for continuous transformation”.
What of Personnel Management?
It is evident that changes in the way one looks at HR in an

enterprise, is (and continues) changing the way the enterprise’s
HR function is organised. In simpler terms, the ‘Personnel
Department’ of the 1960s, responsible for payroll, leave,
discipline and welfare, has now morphed into an HR or, better, a
“talent management” function, responsible for people’s selection,
motivation and development.
Charan (2014, p. 34) suggested a “proposal which is radical but
grounded in practicality: split HR in two strands.” One strand has
administration as its remit, primarily managing remuneration
and benefits. It would report to the Chief Financial Officer, “who
would have to see compensation as a talent magnet, not just a
major cost” while the other strand will focus on leadership and
processes that champion the “people capabilities of the business”.
This strand will report directly to the Chief Executive Officer.
Peters (2001) argues that it is time to dismantle the HR
department and change it to the HE department, the Human
Enablement Department, which guides people towards
empowerment, initiative, rethinking and entrepreneurship.
This marks the advent of disruption of business models, a
surge and spirit of innovation that create new value networks
which displace the status quo in business and the way it is
organised.
This chapter delves into the fundamental changes in HR
globally and the pressure that HR is facing today in Malta.
It provides survey results on the state of HR advisory and
consultancy services in Malta. It finally reviews the emerging
benefits but also perils of engaging external providers in HR.
Changes in the business ecosystem
This is a fast-changing world which is proving to be even more

interconnected through the instruments of technology and
the consequential impact on the human person, physically,
emotionally, intellectually and socially. The challenges on the
human being are taking different forms as the person has a wider
selection of new opportunities and is being exposed to different
risks and threats. Over the last decade, we have witnessed a shift
in human attitudes and behaviour, as well as in aspirations and
expectations. We grossly simplify these by categorising human
persons into different cohorts such as Baby Boomers, Generation
X, Millennials, and so on. Most of the time, we objectify or
consumerise the person in a manner that we lose sight of the
person’s dignity, humanity and individuality.
Those charged with the selection and development of people
in companies need to take this statement as the premise of any
strategy and execution policy. The opportunities and threats
take different forms but are indeed becoming more complex.
We list here a few over-riding social and technological trends
that are affecting the human person and the function of HR in
management.
We are seeing a shift from what we termed in the past as
“employee engagement” to that of “employee experience”,
where culture, well-being, diversity is taking a central position.
This means that the theme of a ‘work-life balance’ is taking a
more robust shape in the way we organise business. Flexibility
in working hours and working from home now form part of
employment practice.
Digitisation is now underlying processes and business
intelligence, providing virtual information on equipment,
methods and people. We do, in fact, speak of ‘people analytics’
with an ‘employee feedback market’ that provides instant,
real-time updates on employee morale and attitudes through
‘sentiment analysis software’, ‘organisational network analysis’,
pulse surveys, gamification and other analytical tools. The issue
here goes beyond ‘people monitoring’ and moves towards ‘people

surveillance’. There is a growing tension between ‘enablement’
and therefore freedom, and less privacy. The recently
implemented General Data Protection Regulations (GDPR),
which are European Union regulations to protect personal data
and privacy, mitigates against this invasion of a person’s privacy
but the tension between ‘monitoring’ and ‘privacy’ is felt in
business environments today.
Perhaps the current aversion to ‘open spaces’ at work is
a subliminal move towards reclaiming privacy: when they
can, employees seek to personalise their workplace, choosing
their own working space. Individualisation is now regaining
importance, and this is creating a new challenge to HR as well as
to office designers. Rightly so, employees are seeking their own
particular way of doing things; but most businesses are not yet
ready to accommodate this.
Performance management has also passed through various
shapes and forms. The traditionally one-sided ‘performance
appraisal’ has moved to the ‘performance management system’
which gives more space to listening, dialogue, agreement and
development. What we are experiencing in business today is the
need and execution of continuous performance management
with ongoing processes for goal setting, evaluation, development
(through coaching and mentoring). The focus is not on scoring
performance at the end of the year, but on regularly supporting,
consulting, developing the employee to improve performance,
and to give and be given feedback.
Organisational structures are also being transformed. The
hierarchy has given way to lean, flat structures working through
matrices rather than the traditional format of A reporting to B.
We witnessed the shift from individuals to teams, but now we are
experiencing the emergence of networks of teams. Relationships
at work amongst employees are becoming more fluid and more
complex. Are HR departments conscious of this shift and, more
so, are they prepared for it? And if not, what are the implications?
The ecosystem is nurturing a labour market of short-term
contracts, casual work, self-employed and freelancers. It is

predominantly more diversified in nationality as the world has
truly become a “global village” (McLuhan & Powers, 1992), with
contemporary issues of gender, cultural tensions and language
barriers. Our economy is increasingly a Gig economy and a Gig
labour force (De Stefano, 2015), with varying expectations; but
that is happening at the cost of undermining the job security and
tenure which the economy used to offer.
The demands from business and its ecosystem are those for
people being more creative, entrepreneurial and innovative. Are
HR departments aware of the implications of changing from
Human Resources to Human Enablement departments? In the
process, HR itself needs to become more creative and innovative.
Five main conclusions can be drawn at this stage:
(1) The basic principle is that the employee is a person
whose dignity must be acknowledged. It is commendable
to speak of enablement and creativity, but the person’s
privacy must be fully respected. The HR department has
the duty to be the custodian of the employee as a human
person, with the right for dignity and development.
(2) The HR department’s objectives and deliverables are
continuously changing. It goes beyond the requirement
that HR keeps itself updated with the developments in
the world around it, but it must realize that it is being
held accountable for results.
(3) HR departments and businesses must invest in
digitisation.
(4) HR departments need to innovate constantly and be
flexible in their HR practices.
(5) HR professionals are to keep abreast of what is happening
around them, while accepting that they cannot be
knowledgeable in everything.
It is within this landscape of continuous change that one asks

whether and how much of this can be done internally by the HR
department of the organisation, and how much of this can be
outsourced. The HR department cannot be a ‘jack – or Jill – of all

trades’; nor do we expect it to be an expert in every field.
The fast-changing HR space in Malta
A changing economy in Malta in recent decades has meant

that employment conditions have changed, and so do the
organisations that support them. This has obliged external
consultants to change their approach and level of support to
organisations.
The economic sectors of professional services, distributive
trade, tourism, gaming and information and communication
technology have become the main pillars of the economy; just
as manufacturing has plateaued and declined. With annual
economic growth hovering over 4 per cent since the last economic
slowdown, the labour market is under pressure in several ways,
including shortage of local labour, an influx of foreign workers
and an increase in salaries and wages.
A prevailing low unemployment rate (4% in Q4, 2017)
meant that economic demand could only be satisfied by expats.
51% of jobs created between 2002 and 2017 were taken up by
foreigners. There are today around 43,000 foreign workers in
Malta, predominantly from EU countries, but a considerable
number are ‘third country nationals’ from such countries as the
Philippines, Serbia and India. Most of the non-EU workers are
employed in elementary occupations (quarrying, construction,
waste collection), although Filipinos are concentrated in health,
nursing and senior care. Workers who are EU nationals tend to
work in all fields including management, technical and associate
professions, clerical and support. One curious trend since 2013
has been an increase in employment in public administration,
by far the largest employer in Malta. On a darker side, only
44% of the total Maltese population is active, due to an ageing
population and a relatively low female participation rate of 55%
(which is on the increase). This is compared to 65% in the EU.
The economy has also experienced pressures on salary and wage

increases, with pay growth hovering around 7% per annum in
the last three years. The professional services and gaming sectors
have been the leaders in wage increases as specialist candidates
are in short supply. These pressures have affected all employment
sectors, including public administration, and leading to generous
wage increases in the latest round of collective agreements.
The influx of foreign workers has contributed to the
transformation of the economy and society; it is sustaining a
high level of economic growth as foreigners are filling in some
very relevant labour and skill gaps across the labour market.
They are also fuelling consumption through strong spending
power as many settle in the country with their family, creating a
multiplier effect using other services including the rental market,
education, health, travel and taxation.
The qualitative impact of this on the HR space is mostly
characterised by issues of diversity, culture and language but also
issues related to conditions of work and remuneration. There are
extremes, as on one hand non-EU members are paid low wages
and given generally the minimum requirements allowed by
regulation, while EU members are paid higher salaries pulling the
remuneration levels for Maltese workers higher. The gaming and
the ICT industries that attract the younger generation, probably
otherwise unemployed in their own country, have contributed
to a gig-employment situation where many workers are on short
term or self-employed basis with no form of long-term security.
The scene in the HR department in Malta-based business has
also varying functions. International businesses initially search for
HR roles that are mostly operational: looking into recruitment and
labour legislation; while Maltese businesses that have expanded
over the last twenty years (many of them also abroad), are seeking
HR roles that are more strategic and can contribute to business
development through new management processes. HR specialists
are scarce, and their demand outpaces their supply. It is at this
point that the need for HR specialists as advisors or consultants
arises and businesses seek specialist support externally.
A survey of Maltese business use of HR consultancies
Research was carried out to get a better understanding of the

landscape of advisory and consultancy services in Malta. The
survey conducted sought to better understand the perceived
benefits and risks of local businesses engaging such advisory and
consultancy firms.
The research was carried out in April 2018 through an
online questionnaire. Responses were received from forty-one
businesses operating in Malta. The breakdown by economic
sector of respondents in this convenience sample is provided in
Table 1:
Table 1: Participating organisations by economic sector (N=41).

Participating organisations by economic sector
Accountancy, banking, and finance 14.6%
Creative arts and design 4.9%
Energy and utilities 7.3%
Engineering and manufacturing 17.1%
Healthcare 4.9%
Information technology 9.8%
Marketing, advertising, and PR 7.3%
Recruitment and HR 4.9%
Retail 17.1%
Others 12.0%
A representation from organisations of all sizes was assured:

the sample included 82.9% of firms that were locally owned, and
17.1% that were foreign-owned (see Table 2).
Table 2: Participating organisations by size.
Participating organisations by size

10 employees and less 19.5%
Between 11 and 49 employees 17.1%
Between 50 and 249 employees 41.5%
250 employees and more 22.0%
Use of external consultants

Respondents were asked whether they have ever made use of an
external consultant. At this point of the research, no reference
was made as to whether the external consultant was specialised
in any particular field. 73.2% of the organisations confirmed that,
over recent years, they made use of an external consultant.
The remaining 26.8% were asked for the reasons why they
have not engaged any external consultants. The main reason
cited for this was that the business managed to solve the problem
on its own (72.7%) while 18.2% claimed that there was no need to
bring in external expertise.
81.8% believe that they will only use an external consultant
if they are convinced that they will benefit from their services
and advice. There seems however to be an awareness gap. 27.3%
of respondents think that external consultants need to be more
accessible to the business community. These two latter results
may indicate that consultants need to focus more on promoting
the value that they provide as well as network more with the
business sector.
Despite this result, 63.6% claim that they will probably not
use an external consultant in the near future. 36.4% state that
they will probably do so. Of the latter, half think that they will do
so in the coming year.
Decision-making criteria for engaging external consultants

Respondents were asked which criteria they consider to be most
important when deciding on engaging an external consultant
(and not necessarily consultants in HR). The principal factor
ranked was that of the external consultant understanding

their business problem, with all responses confirming that this
is a very important factor. This was followed by the external
consultants’ expertise and knowledge (75% citing that this is
also a very important factor). The recommendation that they
receive from others, the consultants’ previous experience, their
impression at the first meeting with the consultant, the offer and
presentation of offer, and timeframe of project were all ranked
as being important. The least important deciding factor was the
conditions and terms of payment.
75% of businesses which have not used external consultants
would consider using independent consultants as opposed to
the consultancy arm of larger and global accounting firms such
as the ‘Big Four’: PricewaterhouseCoopers, Deloitte, EY and
KPMG.
Reasons for not using HR advisory and consultancy services

The research aimed to explore further why businesses did not
specifically buy in more HR advisory and consultancy services in
recent years. 60% of businesses claimed to have their own internal
expertise. 30% felt that there was no need for such cooperation
as they managed to solve their business problems on their own.
The expense aspect was not a popular reason as to why HR
consultancy services were not used. In fact, only 10% claimed
to have not used HR consultants due to cost. All businesses
responded that they would only engage HR consultants if they
were convinced that they will benefit from them.
Respondents were asked whether they would consider
engaging an HR consultant in the future. 50% claimed that they
probably will and 40% might do so within two to three years.
The remaining will probably not engage an HR consultant in the
future.
Those businesses who would consider engaging an HR
consultant were asked on what basis they would choose their
consultant. Most replied that the most important factor is the
understanding of their business problem, followed by expertise
and knowledge and the consultants’ previous experience. Terms

of payment and the country of origin of the consultancy company
ranked lowest.
Again, independent consultants remain the first choice for
respondents. Only 20% would opt for one of the ‘Big Four’ for
their HR needs.
Area of business activity where consultants are mostly sought for

Participants were then asked to specify for which business
activities they used the services of an external consultant.
The most cited business activity was that of human resources
(66.7%), closely followed by legal issues (63.3%) and financial
management (36.7%) (see Table 3).
Table 3: Area of business activity which consultants are sought for.

Area of business activity which consultants are sought for
Human resources 66.7%
Legal issues 63.3%
Financial management 36.7%
Accounting 33.3%
Information technology 33.3%
Quality management 23.3%
Sales and marketing 23.3%
Governance and management 20.0%
Production 10.0%
Writing plans and projects for tender applications 10.0%
Occupational health and safety 6.7%
This is an interesting statistic for Malta considering that

globally, HR consulting represents the smallest consulting
market, compared to strategy, operations, financial advisory and
technology consultancy (Consultancy.UK, 2018).
Use of HR Advisors and Consultants

The survey sought to establish how often the services of HR
advisors and consultants were used in the last three years. 60%
of respondents used such services more than once. However, in
the last year, 35% did not use HR advisors and consultants and
35% used them once.
The study also suggests that, the larger the size of the
organisation, the greater is the chance of using HR consultants.
77.8% of organisations that employ more than 250 employees
have used HR advisors and consultants; while only 25% of
organisations that employ less than 10 workers have used such
HR services.
90% of organisations used local HR consultants for their HR
needs; while 10% have used both local and foreign consultants.
Awareness of HR consultants
55% of the HR consultants were chosen based on
recommendations or because the decision-maker within the
business knew the HR consultant and advisor on a personal level.
Specialized events also attracted businesses to cooperate with
HR advisory and consultancy firms, with 25% of respondents
claiming to have met their chosen HR advisory and consultancy
firm through such events.
Traditional media and online advertising (including the
HR consultant and advisors’ company website) were the least
effective methods for attracting businesses. Such methods
attracted a total of 20% of the participating organisations.
Decision-making criteria for use of HR external consultants

Organisations were asked to identify why they chose the HR
advisor and consultant they cooperated with. The two most
important criteria were the consultant’s expertise and knowledge
as well as the understanding of their business problem: 85% of
organisations considered both of these to be most important.
These were followed by the consultant’s previous experience
(60%) and the recommendation made by others (55%).
The least important factors were again related to payment terms

and timeframe of payment (10% and 15% respectively).
Level of satisfaction
The survey also captured the level of satisfaction with the
services provided as they are matched with the decision-making
criteria for the use of external HR consultants. Only 20% were
“very satisfied” with the level of understanding of the business
problem by the HR consultant and 40% were “very satisfied” with
their expertise and knowledge.
The speed of giving feedback was ranked as the second most
satisfying factor (35% of respondents) and the communication
during the project as the third (25% of respondents). The value
received for the price paid and the value of cooperation were
given a “satisfied” ranking by 80% of the businesses.
20% were “very satisfied” and 75% were “satisfied” with the
overall result of the service. It is of concern that 5% were “very
dissatisfied”.
Reasons for engaging HR consultants

Companies seek HR consulting for many areas, but recruitment
is at the top of the list. This is to be expected to remain in
high demand as companies continue to struggle to attract
employees. On the other hand, the least service required from
consulting firms from businesses is that of talent management
and retention. Organisations may be using their own internal
expertise for talent management and retention strategies, while
engaging external providers for recruitment.
The rest of the HR areas which followed were performance
management, design of HR strategy and organisational change.
Therefore, while recruitment is more tactical in nature, HR
consulting firms are also engaged to provide advice on strategic
decisions (see Table 4).
Table 4: Most popular HR Consulting areas.

Most popular HR Consulting areas
Recruitment 58.8%
Performance management 35.3%
Design of HR strategy 35.3%
Organisational change 35.3%
Training and development 29.4%
Remuneration and reward 11.8%
Other 11.8%
Talent management and retention 5.9%
The ‘Big Four’ were mainly consulted for advice and studies
on remuneration and reward (66.7%). This was followed by
training and development (33.3%). Such consulting firms were
also engaged for the design and development of employee
engagement surveys (33.3%).
The larger the organisation, the greater the chance of it
using HR consultants for HR strategic advice. It is the smaller
organisations that use HR consultancy firms for tasks of a more
tactical nature, such as recruitment.
Overall level of satisfaction vis-à-vis type of HR consultant

The overall level of satisfaction by using independent HR
consultants was high, with 29.4% claiming to be “very satisfied”
and 58.8% being “satisfied” with their services. 5.9% of businesses
were “dissatisfied” with the level of service they received.
The level of satisfaction of using global and larger firms was
less, with an overall level of satisfaction of 66.7% and no one
reporting that they were “very satisfied” with using such services.
33.3% gave a neutral response.
This level of satisfaction of using HR consulting firms leads
to a good majority of respondents (90%) who feel that they will
very likely or likely repeat cooperation with the HR consultants
they worked with.
Conclusions from the survey
It appears that cost is not a major decisive factor for businesses

when choosing whether they will use HR consultants or not. It
is not about the ‘spend’ but about the ‘investment’ and the value
for money that they are getting from using such services. Other
aspects that have been flagged earlier in this chapter, but not
identified by the participating companies, are: (i) the time that
external consultants can free organisations, allowing them to
concentrate on core business activities; and (ii) the impact on
keeping overheads under control by not employing specialists
that will involve ancillary administrative expenses.
It seems that HR consultants are not adequately promoting
their services. The survey results show that the benefits of
consultants’ knowledge, experience and expertise are not widely
known by businesses in Malta and that more work needs to be
done by consultants in developing and promoting their value
proposition.
The study also concludes that businesses tend to opt for HR
consultants for business activities which are more of a tactical
nature, with recruitment being the most widely-used HR service.
The Economist (2002) had claimed that the consulting industry
was going through changes, whereby advice on strategy was
no longer the topmost priority since businesses can now also
attract top talent to handle the design and implementation of
strategy internally. This is supported by the results of this survey:
businesses do not opt for the use of HR consultants because
they managed to solve business problems internally, through
their own expertise. Nevertheless, the HR consultancy market
is changing and providing strategy advice is no longer the main
reason for engaging consultants. Consultants are also being
engaged to take responsibility for parts or all of HR operations.
HR outsourcing and HR consultancies: benefits and risks
Business today is recognising the need for a fully-fledged HR

function, to be competitive in the labour market and attract,
develop and retain the needed talent. The HR function is becoming
more and more complex, moving away from a merely ‘personnel
administration’ function. The pressure being put on the HR
function has led to companies looking for advice from independent
and specialised persons or firms; outsourcing and consulting have
started being introduced more fiercely. Companies are seeking
external advice and support for issues which are critical to the
competitiveness and future of the business.
Outsourcing and consulting are generally seen as two
distinct services which may be offered by one and the same
service provider. Outsourcing has been transforming consulting
businesses. Outsourcing is the process whereby a business
assigns another organisation, which is specialised in a particular
field, to handle issues which are not related to the organisation’s
core activities (e.g. payroll). In contrast, consulting involves a
process of engaging specialisation in a particular field. It is “an
advisory service contracted for and provided to organisations by
specially trained and qualified persons who assist, in an objective
and independent manner, the client organisation to identify
management problems, analyse such problems, and help, when
requested, in the implementation of solutions” (Greiner &
Metzger, 1983, p. 7).
Turner (1982) identified a hierarchy of consulting purposes:
1. Providing information to a client;
2. Solving a client’s problems;
3. Making a diagnosis, which may necessitate a redefinition
of the problem;
4. Making recommendations based on the diagnosis;
5. Assisting with implementation of recommended
solutions;
6. Building a consensus and commitment around corrective
action;
7. Facilitating client learning: that is, teaching clients how

to resolve similar problems in the future;
8. Permanently improving organisational effectiveness.
Consultancy provides organisations with advice and

recommendations, expertise, dialogue and objectivity through
their independence; all on a temporary or contractual basis.
Consultants do not have the authority to take decisions on and
during the implementation process. This is at the discretion of
the client. It is also the client who ultimately decides whether to
accept and follow any advice given to them by the consultant.
In recent years, consulting firms have started to perform
outsourced activities for their clients such as training,
psychological testing and employee research. They have widened
their services beyond advice. Consultants are also expected to
be independent providing an objective and unbiased service to
the client. The consultant is expected not to have personal or
financial interest in the company and is therefore not affected or
influenced by the decisions taken by the company. Consultants
are engaged on a contractual or temporary basis and are paid for
the advice that they give to the client in solving their business
problems.
The decision whether to outsource or bring in external
consultants depends on the level of expertise that the
organisation has within the company itself. Businesses may
prefer to retain control because of confidentiality reasons and
use HR consultancies in a very restricted manner. Businesses
also restrict outsourcing and engagement of consultants as
they consider that they might become overly dependent on the
outsourcer or external consultant.
Companies may also fail to understand how an external HR
consultant differs from an internal HR professional. A consultant
is engaged to support and be involved in different HR functions.
Their roles and responsibilities change according to their
assignment and are exposed to a variety of different organisations
with their own nature, structures and complexities. An internal
HR professional is the ‘expert’ of their current employer.

The benefits of outsourcing or engaging external HR
consultants include reduced fixed costs, improved efficiency,
access to more expertise, flexibility and the opportunity it gives
to focus on core competences. With today’s HR challenges,
outsourcing and the use of consultants provide the opportunity
for a business to concentrate on what it knows best – its core
competences – and leaves the expertise on complex and
changing people issues to experts. “All research, from surveys
to case studies, demonstrates that HR outsourcing is helping
organisations to refocus on strategic people matters. This is
the central argument for outsourcing: successful organisations
excel by focusing on what they do best” (Davidson, 2005, pp.
4-5). Table 5 summarizes the reasons why organisations have
outsourced their HR function ((Hewitt, 2009, p. 12).
Table 5: Why companies have outsourced HR functions.

Why Companies have outsourced HR functions
Opportunity for cost savings 78%
Access to outside expertise 78%
Improve service quality 74%
Realign resources/focus on strategic HR priorities 74%
Relief from regulatory/administrative burdens 70%
Small businesses may benefit even further since daily

administrative work may take too much of the businesses’ HR
team. Outsourcing or engaging an external HR consultant
may bring in the HR strategic expertise which is required
to push the business forward. A good HR strategy could lead
the organisation in being more results-focused in such areas
as people and performance management, talent scouting and
leadership development.
As stated earlier, it is this value-added that consultants
bring to clients which needs to be communicated more clearly
to prospective clients. This is becoming even more so due to
the ever-evolving business challenges, particularly related to

technology and changing employee expectations. This, however,
does not mean that business is generally underestimating the
risks involved.
One important aspect is for businesses to understand
that engaging a consultant does not mean that people
management practices will be solved. The day-to-day
management of people remains the ultimate responsibility
of the management of the organisation. It also does not
mean that the management of the company is being freed
from HR responsibilities when administrative activities are
outsourced or when consultants are engaged to advice on
solving organisational problems.
Another risk is that the day-to-day running of the HR
function may be fragmented from the strategy and policies. This
highlights the importance of relationship management between
the consultancy company and the business. The relationship
must be based on collaborative working with foundations built
on trust and open communication. This will support the service
being provided, reducing the risk of breakdown in the overall
implementation of the HR strategy.
There is the risk of the company missing out on the
opportunity of investing in internal expertise and knowledge on
the most updated HR techniques as it is depending on external
consultants for this specialization.
Just like any other organisational change, the engagement
of outsourcers and consultants needs to start with a clear
definition of the objectives for this decision, and with a design
of an HR function which relies on external providers. All
depends on the wider picture of organisational strategy: its
clarity, structure to deliver strategy, and the alignment of HR
to deliver this strategy. Digitisation and artificial intelligence
are making in-roads into business processes and HR; they are
creating seemingly insurmountable challenges to business and
this creates a more urgent demand for external specialisation
and expertise.
The key word is ‘partnering’ rather than a clean, arms-

length relationship with consultants. HR partnering creates
opportunities for a better understanding of the processes involved
and a means for a transfer of knowledge, skill and competence
into the organisation. Working closely with the company’s senior
executives ensures a better understanding of the HR agenda and
the key priorities, as well as facilitating implementation of HR
programmes.
These are the challenges that Malta-based business,
management and HR specialists are facing at the moment.
Managing a fast changing social and economic environment
with the new complex phenomena of digitisation, diversity
and disruptive business models creates new challenges
that management cannot solve on its own. The services of
outside specialists become more important and urgent, while
management cannot underestimate the benefits and risks that
this involves.
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For full survey results: https://surgeadvisory.com/human_resources/human-resources-
advisory-services-malta/
Subject and Author IndeX
‘500 simplification measures’ in public ‘war for talent’, 39, 341

service, 384 ‘worker director’, 173
‘chips with everything’ offer, 289 1st Development Plan (1959-64), 345
‘commitment to people’ approach, 255 3600 feedback tool, 65-66
‘dirty jobs’ & migrants, 133-4 3M, 200
‘emotional safety in relationships’, 197 4-pillar model for service of excellence,
‘fair day’s pay’, 144 373-4, 379
‘first mover’ advantage in gaming for
Malta, 319 A
‘fortress colony’, 270, 288 Abstenteeism, 101, 104-5, 108
‘fourth industrial revolution’, 284 Academic staff representation on Senate
‘friends of friends’, 353 at UM, 473-4
‘ideal worker’ template, 120, 135 Accession to the EU, 141
‘Internet of Things’ (IoT), 271-2 Accident & Emergency Department,
‘irregular’ migrants, 136 MDH, 452
‘knowledge creating company’, 152 Accusation & acrimony, 58
‘organisational excellence’, 482 Achievement motivation, 81-82
‘over-tourism’, 308 Action learning, 150
‘problem-solution-problem’ sequence, 151 Adams, and equity theory & organisational
‘quick fix’ approach, 7 justice, 86-87
‘self-inflicted’ illnesses, 101 Adelaide, Queen Dowager, 297
‘spirit of creativity’, 188 Adult learning, 150, 160
‘sticky environments’, 427 Advanced manufacturing & 3-D printing,
‘talent management’ function, 482 36-37
‘think manager – think male’, 130 Advanced robotics & autonomous
‘unencumbered males’, 132 transport, 35-36
Advisory Services, 481-502 BALDACCHINO Leonie, 187-216

Affiliate marketing in gaming, 328-9 Banco di Malta, 212
Affiliation, achievement & power, 99-100 Bank of Valletta (BOV), 212, 412
African Media Association, 133 Banking Act, 417
Age, in agriculture & fisheries, 230 Banking sector, 212, 411-432
Agency for Welfare of Asylum Seekers Barclays Bank DCO, 413
(AWAS), 366 BARTOLO ZAHRA Maria, 481-502
Agency theory, 14 Barts / London School of Medicine &
Agents of innovation, 193 Dentistry, 435
Agricultural Cooperative (AgriCoop), 236 Basic specialist training (BST), 445
Agriculture, 219-244 Benefits & risks of HR consultancies, 497-
Agronomists, 233 501
Air Malta, 299 Benefits of agriculture & fisheries, 242
Alcohol consumption, 104 BEZZINA Frank H., 3-22
Allied assistants in health sector, 439 Big data, 3-22
Allied health professions, supply of, 439 Block Chain, 429-30
Andragogical model of HRD, 150 Blue fin tuna (tonn) industry, 227
Anglo-Maltese Bank, 212, 412 Board composition, 130
Annual work unit (AWU), 221 Boissevain, Jeremy, 297-8
Anti-money laundering (AML), 319 BORG Anna, 119-140
Application forms, 45 BORG Colin, 457-480
Appreciation of context, 88-89 Boundaries between work & non-work,
Apprentices hired by British Navy, 158 276
APS Bank, 414 Breaches in psychological contract, 86-87
Aquaculture, 219-244 British coal mining, 28
Arbitration, 179 British colonial rule, 165, 364
Areas where HR consultancy is most British military presence, 289
sought, 492 Bugibba, 300
Artificial intelligence (AI), 36 BUHAGIAR KLASS Caroline, 53-74
Assessment centres, 46 Building an employer brand, 42
Asylum seekers, 132 Bureaucratic learning continuum, 156-7
ATTARD Everaldo, 219-244 Bureaucratic orientation to work, 391
Attracting & retaining staff in HEIs, 462-4 Business intelligence (BI), 326
Attracting talent to finance sector, 423 Business units in Malta, 24-25
Attractiveness of tourism as employer, Business-to-business (B2B) license, 321-3
295-6 Business-to-customer (B2C) license, 321-
Audit Department, 365 3
Automation & deskilling, 278 Buyer’s remorse, 50
Automation, 269-286
Awareness of HR consultants, 493 C
AZZOPARDI Joseph G., xvii-xxxv, 141-164 Canada, 325
AZZOPARDI Myrna, 363-390 Cancer care services, 436
Capacity & capability, 30-31
B Capacity shortages, 31
BALDACCHINO David, 3-22 Career progression & gender, 131
Baby Boomers in the workforce, 425-6, CASSAR Joyce, 363-390
484 CASSAR Vincent, xvii-xxxv
BALDACCHINO Godfrey, xvii-xxxv CATANIA Gottfried, 75-94
Subject and Author Index 505
Cattle rearing, 225 Conciliation, 179

Central Bank of Malta, (CBM) 415 Conditions of Employment Regulations
Centre for Development, Research & Act (CERA) (1952), 166-7
Training (CDRT), 370 Confederation of Malta Trade Unions
Centre for Labour Studies, University of (CMTU), 169, 176
Malta, 183, 401 Conformists, 98
Centre for milk pasteurisation, 237-8 Consequences of culture, xix, 83-84
Certificate of Completion of Basic Construction, 245-268; accidents, 259-
Specialist Training (CCBST), 442 60; charge-out rates, 257; cost of
Certificate of Completion of Specialist labour in industry, 255-6; culture
Training (CCST), 442, 444 in industry, 249-51; direct labour,
Challenge of staff availability for SMEs, 256-7; European context, 246-7; cost
341 cutting, 256; history in Malta, 247-9;
Chamber of Pharmacists Trade Union, HRM in industry, 251-5; innovative
176 technology, 264-5; managing diversity
Change drivers in the labour market, 23-24 260-1;subcontractors in industry, 253-
Changing HR professional in Malta, xvii- 4; training, 256
xxxv Consultancy services 481-502
Changing Maltese workscape, xvii-xxxv Continued professional development in
Charge-out rates in construction, 257 health sector, 442
Cheltenham horse jump races, 333 Continuous improvement & people
Choice, 97 development, 58
Chronic diabetes, 104 Contribution of education to GDP, 461
Client-centrism for prosperity, xxxii Control, 75-94
Climate change, 240-1 Co-operative Societies Ordinance (1946),
Clinics, 433-56 235, 239
Collective agreements, at UM, 469; Co-operative societies, 233, 235-240
in banking sector, 416; in health Corinthia Group of Companies, 173
sector, 445-6; in public sector, 395-7; Corporate brand identity management,
significance of, 170-4 372-3
Collective Bargaining Unit (CBU), 401, Corporate identity in public service, 371-
402-3 85
Collective bargaining, 165-86 CORTIS Dominic, 317-336
Combating funding of terrorism, 320 Cost cutting in construction, 256
Commission for Domestic Violence, 366 Cost of labour in construction industry,
Commitment, 74-94 255-6
Common mental health disorder Cost of Living Allowance (COLA), 171
(CMHD), 103, 106 Council elections at UM, 473
Competing with ‘Big Tech’, 412 Council for Nurses & Midwives, 435, 447
Competition for scarce (human) Council for Professions Complementary
resources, 308 to Medicine (CPCM), 435, 439
Competition from private HEIs, 461 Coverage of collective bargaining, 173-4
Competitive exams for public servants, Creating commitment & engagement, 59
364-5 Creating maximum benefit for all
Complexity at work, xxxii stakeholders, 69-70
Compliance checks in public service, 382-3 Creativity as skill, 189
Conciliation and Arbitration Act (1948), Creativity at work, 187-215
166 Cruise ship tourism, 307
Cultural holidays, 262 Diversification in tourism, 289-91

Cultural integration, 262 Diversity at work, 119-40
Cultural matching, 263 Diversity in the workforce, xxxii, 424-6, 488
Cultural tourism, 291 Diversity management policies, 261-3
Customer care in gaming, 331-2 Dockyard (it-Tarzna), 159, 166, 177
Cyber security analysts, 325 Domination of men in economic sectors,
129
D Dorado (lampuki) industry, 227
DALMAS Miriam, 433-456 Drivers of change, 33-37
Data security, 67 Droit à la deconnexion (right to be
Data tracking, 271 disconnected), 276-7
DEBONO Manwel, 165-186 Drone surveys of industrial estates, 283
Decentralisation & generational continuity Drucker, Peter, 482
in SMEs, 355 Dual factor theory, 78-81
Decline in full-time agricultural
workforce, 220-1
Decline in militant trade unionism, 178-9 E
Decolonisation, 159 Eastern Europe as source of doctors, 438
Defence and Financial Agreement (1972), Education, 141-64
299 Effectiveness of participation in
Defining clear outcomes, 57 institutional governance, 476
Demand for labour in financial sector, Electronic gaming, 317-36
420-1 Eliciting ideas, 204-7
Demand for tuna in Japan, 227 Emotional & cognitive reactions, 98
Demystifying equality, 121-3 Employed population, 25
Dentists, supply of, 438 Employee assistance programme (EAP),
Department of Family Medicine, 108, 113
University of Malta, 450 Employee lifetime value (ELTV), 37-40
Department of Industrial & Employment Employee Support Programme (ESP), 376
Relations (DIER), 133, 173, 179 Employee turnover in finance sector, 426-7
Department of Value Added Tax (VAT), Employees becoming intrapreneurs, 187
366 Employer identity, 42
Departmental quality assessments, 381 Employment & Industrial Relations Act
Deposit Guarantee Scheme, 415 (EIRA) (2002), xxii, 167, 394
Deskilling and automation, 278 Employment agencies in construction,
Developing knowledge workers, 142 251
Development planning, 68-9 Employment in financial sector, 416-7
Development, 141-64 Employment in public administration,
Diagnostics in HR, 3-22 366-7
Direct discrimination, 127 Ensuring efficiency & high productivity,
Direct labour in construction, 256-7 143
Directorate for Allied Health Care Entrepreneurship, 187-215
Services (DAHCS), 439 Environmental impacts of aquaculture,
Directorate for Nursing Services, 437 228
Discrimination, causes of, 126-7; practice Equal opportunity, 263
of, 123-4; protection from, 125 Equality at work, 119-40
Distributed denial of service (DDoS), 325 Equity theory & organisational justice,
Distrust and contempt, 199 86-7
Establishment Code (Estacode), 369, 375 Farrugia & Sons (Farsons), 212
Establishments Division, 370 Fear of failure, 195-7
Ethics in HR, 259 Feedback from multiple stakeholders, 65
EU and EFTA workers in Malta, 131-2 Female participation rate, 34, 76
Eurobarometer survey, 133 Filipino community, 233
European Attractiveness Survey, 411, 419 Financial reward, 105-6, 204-7
European Central Bank (ECB), 411 Financial services, 411-32
European competitiveness, 343 Financial support, 203
European Institute for Gender Equality FIORINI Luke A., 95-118
(EIGE), 131 Fisheries Cooperative, 239-40
European Quality of Life Survey (EQLS), Fisheries, 219-44
103, 104 Fishing vessels, 227
European Regional Office of the WHO, Fitters’ Union, 165
453 Flat hierarchy in SMEs, 349-51
European Union (EU), xxi, xxviii, 24, 31, Food & Agricultural Organisation (FAO),
104-8, 110, 112, 113, 121, 132, 133, 233
135, 141, 162, 170, 173, 177, 223, 225, Foreign direct investment (FDI), 271
229, 232, 239, 240, 247, 248, 309, 319, Foreign workers, 120; in construction
338, 339, 340, 343, 344, 405, 411, 420, 252, 259; in finance, 422-3
422, 428, 433, 436, 437, 438, 441, 442, Foreignness, newness & smallness as
443, 447, 452, 453, 487, 488 liabilities for SMEs, 358
European Union of Medical Specialties Fortune 1000 firms, 15
(UEMS), 442 Fortune 500 firms, 15
European Work Council (EWC), 172-3 Forum Unjons Maltin (FORUM), 169, 176
European Working Conditions Survey Forward planning at work, xxxii
(EWCS), 103 Foundation for Human Resources
Evidence based management (EBM), 4-6 Development (FHRD) Malta, 17
Expansion of cities, 144 Foundation for Medical Services (FMS),
External consultants, use of, 490-1 366, 400
France, 276
F Fraud, risk of, 331
Factory work, 269-286 Fruit production, 223
Faculty of Dental Surgery, University of Full employment in Malta, 76
Malta, 434 Full-time equivalent (FTE), 11
Faculty of Health Sciences, University of Future jobs & skills, 26-27
Malta, 434, 447, 448
Faculty of Medicine & Surgery, University G
of Malta, 434 Gambling, 329
FALZON Elaine, 317-36 Game of capitalism, 275
Familiarity in small states, 199 Gaming Act (2018), 319-21
Family Business Act, 339-40 Gender gap in financial sector, 421
Family business, 337-62 Gender inequality at work, 128-32
Family firms, and trust, 198 Gender issues at work, 119-136; in
Family values, 262 agriculture & fisheries, 230; in
Family-friendly measures, 109 construction, 251
Farmers’ Central Co-operative Society Gender pay gap (GPG), 131-2
(FCCS), 235-6 General Workers’ Union (GWU), 166,
Farmers’ Wine Cooperative Society, 236 168, 169, 171, 173, 175, 176-7, 282, 400
Generation X in the workforce, 425-6, 484 HR issues in specific economic sectors,

Gibraltar, 319 217-502
Gig economy and gig labour force, 486 HR management & development function,
Global Competitiveness Report, 26 1-216
Goal-setting theory, 84-85 HR manager versus project manager in
Goats’ Milk Vendors Association, 238 construction, 250-1
Golf course proposals, 303 HR model in higher education, 458
Google Analytics, 327 HR outsourcing, 497-501
Google search engine, 327-8 HR planning, 40
Google, 200 HR professionals in banking sector, 417-9,
Gozo Agricultural Cooperative 430
(Gozitano), 236 HR standardisation, 154
Gozo Farmers’ Cooperative Association, HRM practitioner, 7
236 HRM system strength, xix
Grand Harbour, 270 HSBC Bank Malta, 413
GRIXTI Mario A., 391-410 Human capital management (HCM), 14,
Gross domestic product, 284, 461 18
Gross value added (GVA), 28-29, 271, 416 Human capital, 341, 347-53
Growth of banking sector, 414 Human Enablement Department, 482, 486
Human Resource Analytics (HRA), 11-2
H Human Resource Development (HRD),
Harmonious industrial relations climate, 149
179 Human Resource Management (HRM),
Hawthorne studies, 145 xvii-xxxv; as both art & science, 158
Headache & fatigue, 103 Human rights, declaration of, 123
Health Care Professions Act (HCPA) Hygiene factors versus motivators, 78-81
(2003), 435, 441, 442, 447
Health Care, 433-456 I
Health expenditure, 433 Immigration, and impact on national
Health of the Maltese workforce, 102-5 health care system, 452
Health promotion, 107 Implementing effective performance
Health specialist trainee (HST), 446 management, 61-4
Healthy working environment, 106-11 Import tariffs and production quotas, 229
Herzberg, and dual factor theory, 78-81 Improved accountability in public service,
Hierarchy of needs, 77-8 384-5
Higher Education Institution (HEI), 457- Inclusion at work, 119-40
78 Increase in non-Maltese nationals, xxiii
Hilton / Portomaso Project, 303 Increases in salaries & wages, 487-8
Hobby farming, 231 Incremental innovation, 191
Hofstede, and the consequences of Independence Constitution (1964), 365,
culture, xix, 83-4 368
Honey production, 226, 239 Indicators in HR, 3-22
Hospitality, 287-316 Indirect discrimination, 127
Hospitals, 433-56 Individualism versus collectivism, xix, 84
Hotels in Malta, 297 Induction of new employees, 23-52; 49-50
HR analytics, 3-22; and IT systems, 18; Industrial disputes and their resolution,
Google’s use of, 15; Sysco’s use of, 15 177-9
HR in tourism, 313-4 Industrial Relations 165-186
Industrial Relations Act (IRA) (1976), 166-7 Job mobility, increases in, xxiv
Industrial Relations Unit, 383 Job resources, 100-1
Industrial society, 143 Joint Financial Stability Board, 415
Industrial Training Act (1952), 158-9 Joint Negotiating Team (JNT), 401
Industrial tribunal , 166 Just-in-time manufacturing, 271
Influx of EU workers in tourism, 309
Influx of foreign workers, 487, 488 K
Information and Communications Key performance indicator (KPI), 326, 459
Technology (ICT) industry, 212, 422 Knowledge society, 143
Information technology (IT), 324 Kolb, and learning cycle, 150
Innovation at work, 187-215 kunserva (tomato concentrate), 221, 236
Innovative technology in construction,
264-5 L
Innovators, 98-99 Labour importing economy, xxv
Institute for Public Services (IPS), 370, Labour shortage in financial sector, 420-1
377-8, 401 Labour theory of value, 277
Institute of Digital Games, University of Land title holding, 231
Malta, 459 Language schools, 461
Institute of Health Care (IHC), University Latency, 98
of Malta, 446, 448 Learning cycle theory, 150
Institute of Tourism Studies (ITS), 302, Learning Machine Group, 429
460 Learning organisation, 145-6
Institutions of higher learning, 457-80 Level of effort, 98
Instrumental basis for trade union LGBTIQ community, 120-1
membership, 182 Life cycle of performance management, 70
Instrumental orientation to work, 391 Lifelong learning, 147
Intellectual capital (IC), 152-3; as valued Link between motivation and human
asset, 153 behaviour, 97-8
Intellectual property rights, 199 Link between QoL and wellbeing, 96-7
Intelligent machines, 272 Livestock rearing, 224-6
International Organisation for Local labour market, xvii-xxxv
Standardisation (ISO), 349 Locke and Latham, and goal-setting
Internationalisation, 343-5 theory, 84-5
Interviews, 45-46 Lohombus Bank, 413
Intrapreneurship, 192-5 Lombard Bank of Malta, 413-4
Intrinsic versus extrinsic motivators, 78- Long hours at work, 110
81, 111-2 Lord and Lady Strickland, 212
Ireland, 319 Low cost airlines, 304
Irish Data Protection Commissioner, 325 Low unemployment rate, 487
Island culture, 55 Loyalty at Work, 337-62; loss of, 280-1
IT & security issues in gaming, 324-6 Lump labour in construction, 258
Italy, 438
J M
Job characteristics model, 111 Malta Beekeepers Association, 239
Job demands & resources model (J-DR), Malta College of Art, Science &
100 Technology (MCAST), 234, 274, 378,
Job demands, 100-1 434, 457-80
Malta Council for Economic & Social Marsaskala, 299, 300, 302, 303
Development (MCESD), 176 Marsaxlokk Fishers Association, 239
Malta Council for Science & Technology Marx, Karl, 277
(MCST), 204 Masculinity versus femininity, xix, 84
Malta Dairy Products (MDP), 238, 239 Maslow, and hierarchy of needs, 77-8
Malta Employers Association (MEA), 171 MASSA Nathaniel P., 337-62
Malta Financial Services Authority Mater Dei Hospital (MDH), 434, 436, 444,
(MFSA), 366, 415 449, 452
Malta Foundation Programme (MFP), 445 Maximising creative potential, 188
Malta Gaming Authority (MGA), 317 Mayo, and Hawthorne studies, 145
Malta Government Tourist Board, 298 McClelland, and achievement motivation,
Malta Hotels & Restaurants Association 81-2
(MHRA), 295 McGregor, and Theory X / Theory Y, 82-
Malta International Airport, 305 3, 146-7
Malta Labour Party (MLP), 168, 173 Mediation, 179
Malta Organic Agriculture Movement, Medical & Kindred Professions Ordinance
240 (1901), 441
Malta Public Administration (MPA), 391- Medical Association of Malta (MAM),
408; pay packages, 405 176, 446
Malta Stock Exchange (MSE), 130, 429 Medical Council, , 435
Malta Tourism Authority (MTA), 308 Mediterranean diet, 241
Malta Union of Bank Employees (MUBE), Mega trends in HR, 481
168 Mental health , 452
Malta Union of Midwives & Nurses Merton, and ‘strain theory’, 98-9
(MUMN), 168 Metrics in HR, , 3-22
Malta Union of Teachers (MUT), 166, 168, Michigan model, , xviii
175, 176 Midland Bank, 413
Malta Youth in Agriculture (MaYA), 240 Mid-Med Bank, 413
Maltese cuisine, 289 Midwives, supply of, 437-8
Maltese economy: demand and supply Migrant workers, 132; in agriculture &
dynamics, xx-xxii fisheries, 232-3; in construction , 252-
Maltese Fisheries Society, 239 3
Maltese labour market statistics, 76-7 Migration, 288
Maltese Lira (currency), 300, 301 Milk Marketing Undertaking (MMU), 238
Management fad, risk of, 14-5 Milk Producers Cooperative (KPH), 237,
Management of cooperative societies, 238
236-7 Millennials in the workforce, 425-6, 484
Management Personnel Office (MPO), Ministry for Health, 434, 447
370 Ministry of Finance, 384, 397, 401
Managerialism, 457 Mintoff, Dom (Prime Minister), 299
Managing director (MD), 348-58 Mobile internet and cloud technology, 35
Managing diversity in construction, 260-1 Model collective agreement, 171
Managing HR in HEIs, 461-72 Monetary versus social profit in public
Managing innovation, 207-11 service, 407
Managing people’s resourcefulness, 157, 162 Money Laundering Directive, 417
Manufacturing, 269-286; automation Monte di Pietà, 364
& deskilling, 278; technology & job Motivation, 75-94; definition of, 75
creation, 279; skill requirements, 279 Multiculturalism at work, xxxi
Multivariate statistics, competence in, 17- Overall equipment effectiveness, 280

18 Overfishing, 227
Musculoskeletal disorder (MSD), 103, 106
Muslim workers, 120 P
myHealth electronic portal, 451 PACE DEBONO Malcolm, 23-52
Mystery shopping in public service, 381 Paddy Power, 325
Parental leave, 135
N PARNIS David, 269-86
National Bank of Malta, 413 Participation gap between men & women,
National education policy, 28 129
National Fisheries Cooperative, 239-40 Pay negotiation, 391-410
National Forum of Trade Unions (NFTU), Pay packages in public service, 405
183 Pay per click (PPC), 327
National Health Service (NHS), UK, 434 Pay per view (PPV), 327
National KPI framework, 477-8 People & Standards Division (P&SD), 370,
National Lottery license, 321 374, 375, 378, 383
National Skills Council (NSC), 161 People management in public service,
National Statistics Office (NSO), 29, 76, 371-85
273, 292, 293, 294, 367, 419, 452 Perceived relevance of trade unions, 181-3
Necessity as mother of invention in SMEs, Performance appraisal, 458; in public
342 service, 377
Need for specialist medical training Performance improvement plans (PIPs),
overseas, 433-4 62-3
New job titles at UM, 470 Performance indicators, 460
New Public Management (NPM), 457, 458 Performance management in higher
NIMBYism, 307 education, 457-8
Novice versus experienced Performance management programmes in
internationalisers, 348 HEIs, 468-72
Nurses, supply of, 437-8 Performance management system, 64-6,
Nursing & allied health professions, 446-9 485
Nursing School, 447 Performance management, 53-74
Performance related pay for admin staff at
O UM, 471
Obligations of caring, 135 Performance-oriented job titles in HEIs,
Occupational accidents, 259-60 468-72
Occupational Handbook for Malta, 31 Persistence, 98
Occupational health & safety (OHS), 106- Personal holidays, 262-3
7; in construction, 258-60 Personally identifiable information (PII),
Occupational Health & Safety Authority 325
(OHSA), 106-8, 113, 259 Personnel Management, 483
Off-peak tourism, 311 Personnel management, xxi
Olive oil production, 223-4 Pharmacists, supply of, 438-9
Open communication, 202-3 Pharmacy Council, 435
Order of the Knights of St John, 287, 364 Phoenicia Hotel, 212; dispute (1990), 179
Organisational commitment, engagement Physicians, supply of, 436-7
& loyalty, 87-8 Piece work labour (bl-imqieta), 258
Organisational size, 345 Pig Breeders Cooperative (KIM), 237, 238
Organisational structures, 485 Pig production, 226
Planning for development & capabilities, 58 Quality hotel destination, 297-8

Police Officers’ Union, 169 Quality hotel investment, 298
Policies for active inclusion, 424 Quality Label Award in public service, 380
Post-graduate Medical Training Centre Quality Mark campaign, 229
(PMTC), 444 Quality of life (QoL), 95-118; five facets
Potato crop, 222 of, 96
Poultry industry, 226 Quality of management, 88
Power distance, xix, 84
Practice development nurse (PDN), 448 R
Precarious employment, 158 Race at the workplace, 119-36
Presenteeism, 101-2, 104-5, 108 Racism, 125
Primary health care, 449-51 Radiographers, supply of, 439-40
Princeton Review, 459 RankBrain (artificial intelligence
Privacy in the workplace, 485 algorithm), 328
Private licensed educational institutions, Rebels, 99
461 Recognition of Trade Unions Regulations
Probability of response, 98 (2016), 167
Processing power & big data, 35 Reconceptualisation of work, xviii-xix
Professionalisation of management in Recruitment of staff, 23-52; in agriculture
SMEs, 355-6 & fisheries, 228-9; in SMEs, 341-2
Promoting physical exercise in the References, 46
workplace, 107 Registered commercial firms, 340-1
Psychological contract, 86-87 Regulatory Councils in health sector, 435
Psycho-social risk, 106 Remuneration gap between men &
Public Administration Act (PAA) women, 131
(2009/2019), 366, 368, 369, 370, 371, Report generation for HR, 67
374, 393 Reputation management, 196
Public Administration Collective Research & Innovation (R&I) schemes,
Bargaining Unit (PACBU), 401-2 204
Public Administration HR Office Resistance to open communication, 203
(PAHRO), 370, 402 Resource based view of the firm (RBV), 13
Public administration priorities, 363-4 Resourcefulness, 347
Public management toolkit, 379 Retention as challenge in gaming, 333
Public sector, 363-90; 391-410 Retreatists, 99
Public Service Classification Agreements, Reward management, 59; 63-4; 95
396 Reward systems, 95-6
Public Service Commission (PSC), 365, 368 Rewards, 95-118
Public Service Management Code Richmond Foundation, 108
(PSMC), 172, 369, 375 Risk taking, 195-7
Public Service Reform Commission Ritualists, 99
(PSRC), 369-71, 394, 408, 458 Robens, Lord Alfred, 288
Public Service Salary Scales, 396 Robotics, 271
Public service, 171, 172, 363-90, 391-410 Role modelling, 263
PwC, 17, 419 Role of the founder in SMEs, 352-3
Rules versus principles based standards,
Q 155
QP Management, 249 Rural development programme, 230
Quality health care, 449-51
S Sliema/St Julians tourist hub, 301, 302

SANT Petra, 23-52 Small & Medium Scale Enterprises
SANT Rita, 245-68 (SMEs), 337-62
Satisfaction with HR consultants, 494, 495 Small & Medium-Sized Family Business
Schengen Agreement (1990), 301 (SMFB), 345-58; flat hierarchy, 349-
Scicluna’s Bank, 212, 413 51; role of the founder SMEs, 352-3;
Science, technology, engineering or social capital 353-4; trust-based family
mathematics (STEM), 324, 422 friendships, 354; decentralisation
Scientific management, 99, 143 & generational continuity, 355;
Sea bass farming, 227 professionalisation of management ,
Sea bream farming, 227 355-6; sourcing knowledge & social
Search engine optimisation (SEO) skills, contacts, 356-7
327-8 SME, definition of, 338-9
Seasonality in tourism, 291 SMEs as main generators of jobs, 358
Second World War, 288 SMEs as motors of economic growth, 339
Sectoral agreements in public sector, 398- Smith, Adam, 337
9 Social capital in SMEs, 353-4
Sectorial growth in Maltese economy, Social media for marketing campaigns,
28-9 329
Selection of recruitment technology, 45-8 Social partnership, 175-7
Selection of staff, 23-52 Società Mutuo Soccorso, 165
Selection tests, 48 Society in relief of the Farmers of Malta &
Service & hospitality, 311 Gozo, 235
Service of excellence, 374-5, 379 Society of Administrative and Executive
Services delivered by trade unions, 174-7 Civil Servants (SAECS), 365
SERVQUAL research tool, 381 Software development industry, 212
Setting clear objectives, 57-58 Solidaristic orientation to work, 391
Settlement of trade disputes, 180 Solidarity & trade unions, 181-2
Sexism, 124-5 Sourcing & recruiting job candidates, 43-4
Shanghai Academic Ranking of World Sourcing knowledge & social contacts in
Universities, 459 SMEs, 356-7
Shared governance structures at UM, 472- Soviet Union, collapse of, 302
7 Spain, 438
Sheep & Goat Producers Association, Special Market Policy Programme for
238-9 Maltese Agriculture (SMPPMA), 222-
Sheep & goat rearing, 225-6 3
Shift to knowledge capital, 141 Specialist Accreditation Committees
Shortage of local labour, 487 (SAC) in health sector, 435, 442, 443
Sickness absence analysis, 108 SPITERI Gertrude, 411-32
Sir Anthony Mamo Oncology Centre Sportsbook, 329-30
(SAMOC), 436 SQL & NoSQL databases, 324
Size of Malta, 343-4, 354 St Luke’s Hospital, 449
Skill requirements in manufacturing, 273 St Paul’s Bay, 302
Skill requirements in manufacturing, 279 Staff Development Organisation (SDO),
Skill sets: changes & increased demands, 370
xxiv Standard operating procedure (SOP), 228
Skills shortages, 31-32 State registered nurse (SRN), 447
Skipping industrialisation, 159 Strategic military value, 287
Strategic role of HRM, 8 Tourism related employment, 292-5

Strategy of disciplined eclecticism, 275 Tourism, 287-316; accommodation, 297;
Strike action, 177-8 and cruise ships, 307; and culture,
Student numbers in HEIs, 460 291; and employment, 292-5; and
Student representation in governance, golf course proposals, 303; and HR
476-7 issues, 313-4; and low cost airlines
Subcontractors in construction, 253-4 304; attractiveness as employer, 295-6;
Sub-Saharan migrants, 133, 134, 135 development, 296-309; diversification,
Succession planning, 60-61 289-91; seasonality, 291
Suez Crisis, 288 Trade union movement in Britain, 165
Swordfish (pixxispad) industry, 227 Trade Unions & Trade Disputes Ordinance
Sympathy strikes, 177-8 (1945), 166
Trade unions, 165-186; and mobilisation
T campaigns, 177
Tagliaferro Bank, 212, 413 Trafficking in Person report, 134
Talent acquisition strategies, 41 Training , 141-64; in construction, 256;
Talent management, 37-40 versus development, 149; within
Tapping into knowledge institutions & organisations, 148, 150-1
centres of excellence, 357 Training & development in finance sector,
Taylor, and scientific management, 99, 428-9
143, 281, 482 Training & development of staff in HEIs,
Teaching English as a Foreign Language 465-8
(TEFL), 212 Transformation at work, xxx
Technological obsolescence, 27-28 Trawlers, 227
Technological tools in public service, 381-2 Trends in trade union membership, 167-70
Technology & job creation, 279 Trust, 197-9
Technology at work, xxxi Trust-based family friendships, 354
The ‘Golden Mile’, 302 Tuna farming, 227
The Economist Magazine, 496 Turnout during Council elections at UM,
Theories of motivation, 77-88 474
Theory of gendered organisations, 120 Turnout during Senate elections at UM,
Theory X & Theory Y, 82-3, 146-7 475
Third country national (TCN), 132 Turnout of Lecturers during MCAST
Those not in education, employment or elections, 476
training (NEETs), 32
Time as barrier, 7 U
Time to think & nurture creativity, 199- UK General Medical Council, 437
200 UK Malta Foundation School, 437
Times Higher Education University Ulrich, Dave, 482
Rankings, 459 U-Multirank, 459
Tipico, 323 Uncertainty avoidance, xix, 84, 197
Tips on performance management, 66-8 Undulant fever (Brucella melitensis), 237
Tomato growing, 221-2 Unemployed & inactive population , 25-6
Top-down support, 201-2 Unemployment in Europe, 306
Tourism accommodation, 297 Unethical behaviour, 84, 85
Tourism as multiple industries, 310 Union Ħaddiema Magħqudin – Voice of
Tourism development, 296-309 the Workers (UHM), 168, 169, 175,
Tourism policy, 311 176-7, 282, 400, 403
Unione Cattolica San Giuseppe, 414 Wages, in agriculture & fisheries, 229
United Kingdom & medical ‘brain drain’, Weber, and legal-rational bureaucracy,
443-4, 446 144
University of Malta (UM), 175, 401, 457- Wellbeing, 95-118
80; courses offered, 107, 207, 212, 274, Work days lost via strike action, 178
234-5, 378, 434, 440, 448, 450 Worker participation, 172-3
University of Malta Act, 478 Workforce demographics, 23
Use of HR advisory & consultancy Working for the State, 363-90
services, 491-2, 493 Work-life balance, 109-11, 332-3; in public
Utilised agricultural area (UAA), 220, 222, service, 376
224, 241 World as ‘global village’, 486
World Cup winners in gaming, 330, 333
V Writing clear job descriptions, 56
Valletta, 297
Vegetable growing, 222 X
Vella, Gejtu (UHM), 403 Xenophobia, 125
Vineyards, 223 Xuereb, David (Perit), 249
VitiMalta, 236
Vocational Education & training (VET), Z
32, 234 ZAHRA Joseph F. X., 481-502
Voluntary organisations in agriculture & Zammit, Sir Themistocles (Temi), 237
fisheries, 240
W
Wage disparities on grounds of race, 133
Wages in manufacturing, 273

Malta and Its Human Resources - 2019

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Malta and its

Publishing Rights – Malta University Press

All rights reserved. No part of this publication may be

First published 2019

Produced by Midsea Books Ltd

LOC: HF5549.2.M3M3 DDC: 658.3

Notes on Contributors............................................................Page vii

Part I: THE HUMAN RESOURCE MANAGEMENT

5. Wellbeing, Quality of Life and Rewards

Part II: HR ISSUES IN SPECIFIC

16. Public Service and Public Sector (Part 1):

Subject and Author Index.......................................................Page 503

Everaldo Attard B.Pharm.(Hons.), MSc (Melit.), PhD (Melit.) is a pharmacist

Joseph G. Azzopardi BA (Hons.), MSc (Manch.), PhD (Manch.) is Senior

Human Resource Management, Public Money & Management, International

Godfrey Baldacchino BA (Gen.), PGCE (Melit.), MA (The Hague), PhD

Leonie Baldacchino B.Psy. (Hons), MA (Creativity & Innovation), PhD

Maria Bartolo Zahra MSc (HRM) (Leicester), PG Dip (Marketing) (CIM),

Caroline Buhagiar Klass Dip. (Adult Education, Training & Development)

Gottfried Catania BA (Hons.) (Melit.), MSc, PhD (Loughborough) is an

Dominic Cortis B.Ed. (Hons.) (Melit.), MSc (Leicester), AIA (IFoA), is an

Mario A. Grixti DPA (Melit.), MSc (HRM) (Manchester) is a career civil

the Institute for Public Services. In 2003, he co-edited Managing People in

Nathaniel P. Massa B.Com. (Melit.), P. G. Dip. Mangt., MBA (Henley), PhD

David Parnis BA (Hons.), MA (Social Studies) (Melit.) started working in

Petra Sant B.Psych. (Hons.) (Melit.), MSc (Occupational Psychology),

Rita Sant BE&A (Hons.) (Melit.), MSc Project Management (Melit.) is an

Leslie Vella BA (Hons.) Business Management (Melit.) has a 36-year career

the European Travel Commission’s Market Intelligence Group (1988-2014) and

Joseph F. X. Zahra BA, MA (Econ.) (Melit.) is an economist and a director

The Changing Local Labour

It is never too easy to write up (yet) another book on the topic

eventually came to be referred to as the Michigan model

how management, not least HRM, thinks about, and assesses

that HRM has increased in popularity over recent years, as an

The Maltese Economy: Demand and Supply Dynamics

The Maltese economy faces the rest of the 21st century in

maintained a presence on the island; tourism has matured into

within a European and global backdrop and the challenges that

Three key developments

A number of unprecedented developments have occurred in

The first is the increase in non-Maltese nationals (or foreign

unemployment and increasing labour supply resulting from the

Much has changed since the Maltese were described, in a 1524

the evolution of HRM practices within a Maltese context-

Part One: The Human Resource Management and

The first part of this book is mainly conceptual: it brings

the actual context of the HR function in Malta. They present

to be committed to the organisation, lead to yet another key

people as human resources to seeing them as resourceful

them in order for these to “flourish within an organisation,

Part Two: Seven Lessons from a Sectoral Analysis

Part Two of the book presents a broad critical scrutiny of the

of learning. Also, those engaged in these sectors or their aides,

Fourth, our local organisations are becoming more complex

career plans. While, in the case of banking and finance (Chapter

Armstrong, M. & Taylor, S. (2014). Armstrong’s handbook of human resource management

The turbulent and challenging times we live in today have

allow them to evolve their decision-making process to a more

This chapter is divided into three main sections. We start

Revisiting Evidence Based Management

Evidence Based Management (EBM) knows its roots in the

Although managers are well aware of the importance of using