HR-Compliance

1. Why is a sound HR architecture fiscally vital for my Malta setup?
Answer: In international tax law, everything revolves around the subject of Economic substance on the ground (local substance) (Substance over Form). To prevent foreign tax authorities from classifying your Malta Limited as a mere letterbox company and reassessing profits for taxation in your home jurisdiction, the company's core commercial operations must demonstrably take place in Malta. The most effective evidence of this is local, duly employed staff (HR substance). A well-conceived HR architecture directly shields your corporate structure against accusations of operating an illegitimate, artificial foreign entity.

2. Which contracts do I need to establish legally sound permanent establishment substance?
Answer: Depending on the role of each individual, we implement a three-tiered contractual architecture within the corporate setup:

1. Director Service Agreements (Executive Employment Contracts): For executive management, anchoring the actual place of effective management and commercial control firmly in Malta.

2. Maltese Employment Contracts: For local operational staff on the ground (e.g., in customer support, marketing, or IT), formally registered with the Maltese employment agency Jobsplus. JobsPlus.

3. Service Level Agreements (SLAs / Service Provider Contracts): For collaboration with external service providers or freelancers, ensuring service transparency in accordance with the arm's-length principle (,) to be fully substantiated.

3. What changes under the new EU and Maltese pay transparency rules?
Answer: Maltese employment law has been fundamentally updated through the transposition of EU standards, specifically via the Transparent and Predictable Working Conditions Regulations and the Equal Pay (Transparency and Reporting) Regulations Vorschriften über transparente und verlässliche Arbeitsbedingungen tightened. Employers are no longer permitted to rely on vague phrasing such as "attractive salary" in job postings or prior to the initial interview.

You are legally obligated, and are required to disclose the specific starting salary or a transparent salary range, alongside the precise overtime and bonus provisions, to applicants in advance. We adapt your recruitment processes and template agreements to ensure complete compliance with these new transparency criteria.

4. How does hiring cross-border remote employees work through a Malta structure?
Answer: Cross-border remote work entails substantial legal risks. When your Maltese company employs someone who works permanently from an EU jurisdiction abroad (e.g., from a home office in Germany or Austria), that employee is generally subject to the employment and social security laws of their country of residence.

Furthermore, there is an inherent risk that the remote employee inadvertently creates a taxable permanent establishment abroad for the Maltese entity. To prevent this, we structure cross-border working relationships either through legally sound Freelancer-Agreements or use licensed Employer of Record (EOR)employer of record (EOR) models or tailored cross-border contractor frameworks to eliminate liability exposure for your corporate structure.

5. How does the firm support my company operationally in the HR area?
Answer: We provide comprehensive legal and administrative support for your workforce:

• Contract drafting: Drafting tailored employment contracts, including robust, legally compliant clauses governing IP protection, non-disclosure (NDAs), and non-compete covenants.

• Regulatory onboarding: Handling all formal employee registrations and de-registrations with the competent employment authority JobsPlus as well as managing visa and work permit application processes (e.g., via the Key Employee initiative, short: KEI) for TNCs.

• Ongoing Compliance: Ongoing payroll management (Payroll), remittance of Maltese national insurance contributions (NI) and payroll taxes, as well as representation and coordination in employment law disputes.