Leisure Clothing: One Maltese job for every five Chinese

Leisure Clothing, the Chinese company facing allegations of exploitation and human trafficking, is allowed to employ five Chinese workers for every Maltese employed with the company, a spokesperson for the Employment and Training Corporation confirmed.

Work licences for Chinese employed at this textiles company have been issued automatically since 1986 thanks to a quota agreement between the company and the government, which logs the number Maltese employees to that of Chinese employees according to a pre-established ratio, which was originally set at four Chinese workers for each Maltese worker employed.

But in 2014 the quota agreement was changed to enable the company to employ five Chinese nationals for every Maltese employed. 

MaltaToday is informed that the reason for this change was that the company could not recruit enough Maltese workers to meet the established quota.

The Chinese-owned company was recently singled out by the Nationalist Party’s newspaper in-Nazzjon over allegations of human trafficking. During the past days the police interrogated company officials and the Department for Industrial and Employment Relations has commenced court proceedings over breaches in employment law.

In an act of full disclosure the Employment and Training Corporation and the Ministry for Education and Employment provided MaltaToday with all statistics and documentation on agreements governing the employment of third country nationals at Leisure Clothing.

The company currently employs 54 Maltese (26 of whom are part timers) and 122 Chinese workers.

Apart from these Chinese workers the company employs also 26 North Koreans, 10 South Koreans, seven Vietnamese and one Chilean on a full time basis.

The number of Chinese increased from 80 in December 2006 to 161 in December 2011, only to decline to 122 by October 2014. 

But the decrease in Chinese workers was compensated by an increase of workers from other South Asian countries. Workers from these nationalities have only been employed since 2013.

How Maltese jobs were logged to Chinese jobs

Leisure Clothing started operations in 1986 following an agreement between Malta and the Chongqing regional authorities in China.

In September 2004, an agreement was reached between the government and Leisure Clothing Ltd to ensure that the number of Chinese citizens employed should at no time exceed 70. 

It was also agreed that the company should increase the number of Maltese workers from 25 to 27.

In August 2007, MaltaToday revealed that Leisure Clothing Ltd was moving its operations from its Corradino facility to a plant which was to be vacated by textiles company Bortex, after the latter laid off 113 Maltese workers due to foreign competitiveness pressure.

In October 2009 Leisure Clothing Ltd asked for the employment of an additional 55 Chinese workers, thereby raising the workforce from 110 to 165. 

The Employment and Training Corporation disagreed with this request.

In February 2010, Social Policy Minister John Dalli, agreed with Leisure Clothing Ltd’s request to increase the staff complement to 165 from 110 but insisted that for every four Chinese workers a Maltese worker should be employed. Leisure Clothing disagreed with this and wrote to the Ministry of Finance asking for a revision of the quota mechanism.

But in June 2010 the Ministry of Finance, then run by Tonio Fenech, wrote back to the Chinese company to inform them that the four Chinese workers for every one Maltese worker ratio was still applicable.

Two months later, faced with similar demands from Leisure Clothing, the Ministry for Education and Employment reiterated the government’s stance that the ratio of four Chinese workers to one Maltese worker should be retained and that employment licences issued for Chinese workers should not exceed 165.

It was only in 2014 that the government accepted the request to change the ratio from four to five Chinese workers for every one Maltese worker employed.

As from July 2014, the Employment and Training Corporation stopped issuing employment licences to third country nationals residing in Malta on the basis of employment.

Although the applications are now handled by Identity Malta, applications are still referred to the ETC for review. The ETC has recommended the approval of 34 applications by prospective employees at the company while another 41 applications are “pending” because the 5:1 quota has already been reached.

It was MaltaToday which back in 2007 revealed how Maltese jobs were linked to the employment of a greater number of Chinese employed by the same company. 

At that time the authorities referred to a “pre-existing agreement” allowing the company to employ Chinese nationals in the manufacturing sector where non-EU citizens are normally not allowed to work.  But it is only now that the authorities have revealed the quota mechanism applied by both PN and PL administrations.