The General Workers' Union (GWU) has raised strong concerns over proposals for service charges to become part of working conditions in Malta's catering and hospitality sector, warning that the system could leave workers worse off.
The union's concerns come amid increasing reports of restaurants and other food establishments adding an additional 10% service charge to customers' bills.
The GWU said wages, working conditions and employment benefits should remain the direct responsibility of employers and should not depend on additional charges imposed on customers.
It argued that linking workers' income to a mandatory service charge could undermine fair pay and stable working conditions, while also creating uncertainty over how the money collected from customers would be distributed.
The union also warned that the charge could effectively increase prices for consumers, who would be paying an additional fee on top of the cost of their food and drinks. It said this could place further pressure on families and consumers already facing economic difficulties.
Another concern raised by the GWU is the potential impact on traditional tipping practices. The union said customers may assume that workers are already being adequately compensated through the mandatory service charge and consequently reduce or stop giving tips.
This, it warned, could leave workers financially worse off, particularly if there is no clear system guaranteeing that all money collected through the service charge reaches employees.
The GWU stressed that the service provided in restaurants, hotels and other establishments is the result of workers' professionalism and dedication, and said that any service charge introduced should ultimately benefit those providing the service.
The position is also supported by the Association of Catering Establishments (ACE), which has publicly stated that any service charge should be for the benefit of workers.
The union is calling for a clear and transparent regulatory framework governing service charges, ensuring that any money collected is administered fairly and distributed to workers without different establishments interpreting the system differently.
The GWU is also questioning the reasons behind the proposal, pointing to an earlier public discussion about reducing VAT on restaurants to 7% as a measure to support the sector.
As that proposal did not materialise, the union said questions have been raised over whether the service charge could effectively be an attempt to fill the gap left by the proposed VAT reduction.
The GWU said any changes affecting workers, consumers or the hospitality sector should follow proper consultation with all social partners rather than being introduced through measures that could create further uncertainty.
It said the priority should remain ensuring decent wages, improved working conditions and effective protection for workers, while maintaining a fair balance with consumers' interests.
The union said it will continue to monitor developments and reiterated its commitment to defending workers' rights and ensuring that any decision is fair, transparent and in the interests of workers and the wider public.