Security firm excluded from government tender process

The government has excluded a security services company from a government tender, Employment Relations Minister Helena Dalli said this evening.

Speaking in Parliament, Dalli said that the security firm was excluded after the government determined that the unnamed company would have employed workers in precarious conditions.

She said an analysis carried out by the Department of Employment and Industrial Relations had determined that bid offer was too low to guarantee that employees would be paid according to the minimum wage regulations.

Employers paying the National Insurance of their employees need to pay an hourly rate of €4.40 - anything less implies that the workers are pocketing less than the required minimum wage. However, certain categories of workers - especially those working in the service sector, such as cleaners and security guards, or in the construction industry - are registered as self-employed, meaning that the workers themselves need to pay National Insurance.

A worker registered as self-employed, receiving an hourly rate of €4.27, would then need to pay the 10% social security contribution, taking his wage below the minimum wage rate of €4.05.

"After carrying out the necessary checks the company was excluded because it would have employed workers precariously," Dalli said.

This declaration follows the Labour Party's electoral pledge to exclude companies from government tenders if these did not guarantee regular working conditions to their workers.

During the electoral campaign, the Labour Party highlighted the issue of precarity and vowed to eradicate the social phenomenon if elected to office, with Prime Minister Joseph Muscat pointing out that many companies subcontracted by the previous administration employed people on terms which either bordered on the illegal or were outright illegal.

In his May Day address to party supporters last month, Muscat said that his government had sent a clear sign to employers "who play around with workers' rights, who will no longer be eligible to win government contracts" unless they change their ways.

However, he explained that the government would be giving employers time to regulate themselves before being excluded from government tenders.

Speaking in Parliament tonight, Dalli said a government action plan on precarious work would be discussed within the Malta Council for Economic and Social Development later this month. 

Earlier this month, MaltaToday revealed that cleaning contractor Gafà Saveway Ltd was awarded over €8 million in cleaning contracts during the previous legislature and awarded at least one contract which is in breach of minimum wage regulations. 

Information about the cleaning contracts, withheld from the public domain for four years, was revealed in a series of parliamentary answers.

Among the contracts, Enemalta awarded Gafà a tender for cleaning services at an hourly rate of €4.27, which amounts to less than the national minimum wage of €4.05 (that is, the net hourly minimum after universal deductions for social security).