New realities at the workplace | Dolores Sammut Bonnici

On Friday, the Malta Employers’ Association organised a workshop about the effect of ‘social problems’ on businesses: with a focus on “the extent to which employers should be involved in such issues and the mechanisms and techniques that exist to provide assistance at the workplace where possible.” Is it really the remit of an employers’ association to get involved with employees’ private problems? 

As employers, we are already deeply involved in social issues, because we have a social burden to carry: there is National Insurance to pay, and there are also... let’s call them ‘non-productive days’ that we pay for too: public holidays, vacation leave and so on. That is part of any employer’s social burden... and also a duty. Why not? But when other conditions are created in society... problems associated with drugs, gambling, marriage breakdowns... these are things which affect everybody because we are all human. Because we care about people, we tend to get involved and try to help... They are also issues which affect the workplace. Work is an eight-hour daily arrangement, therefore a large part of the day and the life of the employee. If they are undergoing stressful periods, they tend to be unfocused, and not fully engaged. This situation can be detrimental to themselves, to their work colleagues, and also to their employer. The idea behind today’s [Friday] workshop is to bring together employers and the professional entities who can assist both the employee and the employer in managing these stressful parts of our lives: firstly for the sufferer as personal assistance, and also to minimise the resulting effects at the workplace.

But what sort of ‘involvement’ does the MEA actually envisage?

Employers can help by firstly identifying the problem: which is not easy, as it totally depends on whether there are visible symptoms, and whether the employee wants the problem to be identified. A good and sensitive employer can offer assistance in various ways, without being too invasive; and should be sensitive enough to assess the state to which the performance at work is being affected. There are, however, lines that should not be crossed: data protection issues, privacy concerns, etc.

Employees have rights, and employers also have rights: we want to see how we can help both to observe those rights, without interfering with legality... because you can only help to a certain extent. Nowadays, there are entities that can offer specialised, professional help: counselling, even for employers and colleagues... but especially, for the employee himself or herself. We got this group of speakers together to make people aware what’s available today; how we can help each other out, by using these services. First of all, we need to create awareness that these problems are not merely affecting the individual or any one employer: they are becoming quite common. Secondly, we are guided as to how to deal with them; and thirdly, we have to know how to identify such problems, and how to manage them...

Isn’t it slightly ironic, however, that one of the social problems singled out for this workshop is ‘gambling’: which in recent years has become something of a mainstay in the local economy... with Malta now a hub for the international online gaming industry?

It is ironic. Very ironic. In fact, when you see due diligence being done, nowadays you actually have to declare that you have nothing to do with any companies that have shareholding with gaming. It’s part of the normal bank form you would have to fill out. In the past, it used to be considered ‘dirty money’. Today, there is the argument that if gambling didn’t take place online, it would happen underground instead... there’s been a shift in perspective. However, igaming is a legitimate business which many other countries would like to attract away from Malta to their own economies. This is one reason why there is pressure to harmonise corporate taxation across the EU. It is imperative that all political forces in Malta lobby for a retention of our tax regime so that sectors like igaming – which is contributing so much to our economy, both directly through jobs and revenue, and indirectly through the spill over effects on the rest of the economy, including other services and the property market – will be retained in Malta.

There’s also been a shift in perspective about the nature of employment itself. The traditional concept of a ‘job for life’ seems to be less popular today: the job market is experiencing high employee turnover, as more and more employees favour short-term or part-time work instead. This has given rise to concerns about ‘precarious employment’. Does the MEA agree this is a problem? 

We have to be very careful when it comes to defining things like precarious employment. Precarious work is an umbrella term which does not lead to a meaningful discussion. What is termed as precarious employment can be classified into: illegal work practices, atypical employment, and unethical practices. To give a practical example: ‘atypical employment’ might involve a special agreement between employer and employee. It may involve part-time work, or be slightly off the standard line of normal employment. But does that mean that it is precarious? I don’t think so. I recently attended the ILO meeting, and one of the subjects that was very deeply discussed was the future of work. Today, we are looking at teleworking... flexible work arrangements, whereby a job is done when, how and where the employee likes... so long as the job gets done. We can’t be too rigid about being there eight hours a day. We have to allow for these new world-of-work scenarios to come in. 

The unions tend to paint a very different picture of precarious work when they bring it up as an example of ‘social problems’... 

It depends what one’s idea of work is. If, to you, the standard is an eight-hour day at the office... I for one do not agree with that. Today’s standard is not yesterday’s standard. But one must make a distinction here. Not all part time work, or new diverse work agreements, are to be classified as precarious work. In the modern world of work we need to be creative to absorb family friendly measures, and address work life balance issues...

Is the rest of Malta ready for the transition, though? If we take a scenario where an employee is happy to accept a more flexible work agreement... what happens when he or she tries to take out a bank loan, and is told that the requirement involves steady employment for the foreseeable future?

I would say the banks need to educate themselves about the new work realities, too. There are freelance workers, who take on project work or short-term contracts. Things are moving in this direction. Sooner or later we will have to redefine our entire understanding of ‘employment’. Everything is now so connected worldwide... people travel and move so much, that yes, we will have to allow for these new realities.

Salaries: It is crucial for salaries to be in line with the profession or skill offered to render a product or service successful, against both local and foreign competition. Failing this, there would be no employment... and therefore no salaries

But do these ‘new realities’ cater for employees’ rights to the full? Is MEA concerned that employers might concoct flexible work arrangements to, for instance, avoid paying higher salaries?

We are concerned. Let me give you an old example of what used to happen. This is something we never agreed with, and always argued against. When we had the 20-hour week, that was classified as ‘part-time’, but no law to protect the pro-rata, or all the benefits that should go with part-time employment... employers tended to go for 19 hour-and-something-minute week, not to break the 20-hour barrier. This way, they wouldn’t have to pay benefits. We were completely against this from the start. As MEA, we feel it is essential for the workplace to be in harmony, and for the employer-employee relationship to be on solid foundations. It is not acceptable for employers to exploit employees to that extent...

There is, however, more than one kind of exploitation. When the MEA made its proposals on sick leave – arguing that the first day should be counted as a ‘waiting day’ – some saw this as an attempt to curtail standard employee rights...

The sick leave proposal came about after looking at how this is abused and how much it is costing economically. When we compared how we fare against the other 27 EU countries, we noted that the first day is a waiting day in some countries, and in Malta the government has already shifted its responsibility for the first three days of sick leave.

The topic came up during discussions, while looking holistically at how the employers are going to balance out the coming application of a political promise to add four days of vacation leave. It is clear that once again the responsibility is being shifted on to the employers.  Keeping a balance here is very, very important... when you consider that in Malta, 84% of our businesses are micro and small enterprises. There are other measures in the pipeline such as sick leave for parents, paternal leave… to name a few. What we are arguing is that a form of compensatory measure should be included to balance out the social burden on employers.

Meanwhile, in its reaction to the budget, the MEA said, “we need to focus on how economic growth can be generated through a stronger emphasis on increased output per person by shifting to higher value added activities through new economic sectors and also by upgrading existing ones.” The emphasis on ‘higher output per person’ seems ominous: would you expand on that? 

There is a very simple explanation:  if a job can be done to its highest efficiency by four men in one day, using semi-skilled labour and manual tools; and the same job can also be done using high-tech automatic machinery, or just controlled by one professional man in three days, at the same cost….which one would you pick as an example of economic growth? This also is a way in which incomes can be increased, through higher productivity per employee. And that is real growth. When we talk of a ‘boom’ in business, with companies employing more and more workers: it’s all well and good, but if we still have unskilled labour, with employees never really moving up the ladder... then productivity is never going to increase. I’d prefer doing the job with fewer but more skilled (and better paid) workers.   

Speaking of pay: do you think that salaries in Malta are commensurate with the cost of living? What is MEA’s long-term vision for the wage structure of Malta?

Salaries should compensate and reward the employee’s performance and skill… so say the workers’ unions. The government, on the other hand, says that salaries should be enough to cover a decent standard of living. What employers feel, however, is that it is crucial for salaries to be in line with the profession or skill offered to render the product or service successful, against both local and foreign competition. Failing this, there would be no employment... and therefore no salaries at all. So ultimately, salaries should reflect productivity. Now: the situation at present is that employers are having to increase wages just so that employees are retained... because there is such a grave shortage of labour, and rampant poaching is on the rise. This will be very difficult to deal with if the economic situation changes, as it is artificial, and will not hold in low peak times. Currently, differentials are widening because of divergent gross value added between different sectors of the economy…e.g. i-gaming versus retail. 

Teleworking: Today, we are looking at teleworking... flexible work arrangements, whereby a job is done when, how and where the employee likes... so long as the job gets done. We can’t be too rigid about being at the office eight hours a day. We have to allow for these new world-of-work scenarios to come in

You mean the wage gap between those sectors is too high?

It is significantly high. You can’t compare a manager’s salary in those sectors: I-gaming pays much more, for a variety of reasons. But one must be cautious when talking about strategies for wage structures. The government should ensure minimum wages – MEA always supported the minimum wage – with COLA adjustments. However, wages above that bracket should then be determined by market forces.

There is meanwhile a lot of talk about inducing greater female participation in the labour market. Would you agree with quotas for women on company boards, as promoted by the European Commission?

The input of women’s participation has been proven successful already. We must remember that we are talking about 50% of the buying power here, which nobody cared to address or investigate since women’s rights started falling in place.  Female feedback will definitely fill in the missing input for a more holistic decision taken at any board level. Admittedly, in Malta we still suffer from chauvinistic male pride in our homes, and our society is perhaps not-all embracing for the working woman... and yet, the structures are all already in place for any woman to come forward and venture into a career. As for quotas, I do have mixed feelings. On one hand, I feel we are not a third world country that needs to force women onto boards. I would personally be prouder to see women get there on their own steam and because of their competence. But if targets have to be reached to meet European criteria, and not enough women come forward on their own initiative… then quotas will have to be applied.