Overpayments on salaries and bonuses flagged by NAO in state company that redeploys former Malta Shipyard and Air Malta workers with public entities.
The absorption of 280 former Air Malta employees into state-owned company RSSL resulted in overpayments to these employees, the National Audit Office’s annual review found, because payroll adjustments are still being entered manually into a spreadsheet.
The company – Resource Support and Services Limited – was originally created in 2003 as IPSL to absorb former Malta Shipyards employees to be then deployed with government departments and public entities, including local councils.
Today RSSL, which falls under the purview of the Office of the Prime Minister, pays the salaries of 629 such workers deployed within the wider public sector.
The NAO review found a lack of payroll verifications that have resulted in incorrect payments, significant overpayments, poor documentation and record-keeping, and inadequate audit trail in the company.
RSSL management told NAO that in the last years the company had been overwhelmed by the sudden influx of 280 former Air Malta employees and 51 former MIMCOL workers over a relatively short time span, creating “enormous pressure on RSSL’s financial and administrative capacity.”
Payroll adjustments were being manually entered in a spreadsheet and then forwarded to an outsourced payroll contractor for processing.
Despite the heightened risk of human error, there was no internal verification procedure to ensure the reliability of information submitted to the payroll contractor.
This lack of oversight led to significant errors that were not detected by RSSL, such as employees on reduced hours being paid allowances in full, employees paid double weekend allowances, or salaries that did not correspond to any of the salary scales provided in the respective collective agreement, raising concerns about the accuracy of the records maintained.
Air Malta employees who accepted a voluntary transfer to RSSL retained all the benefits held at the time of their employment with the former national airline.
In 2024, RSSL was responsible for paying out €19 million in employee salaries, overtime and allowances.
These include the former airline’s highest-paid workers who were then redeployed at KM Malta Airlines, the national airline’s successor: in that case RSSL would pay the difference between the gross salary paid by Air Malta, and the lower one offered by the new airline.
The NAO however said a lack of documented policies resulted in inconsistencies in RSSL’s deployment process.
The NAO said RSSL’s “roles, functions and goals are not adequately defined”, save for a union agreement in 2003 on the absorption of the surplus shipyard employees.
The NAO even found that some RSSL employees themselves were finding their own public sector employment.
“While it is generally RSSL that identifies employment opportunities for employees, instances were noted where negotiations were conducted directly between the employee concerned and the absorbing entity, keeping RSSL in the dark and only being informed at the very late stages of the process, or even after decisions had already been made.”
The NAO said RSSL should introduce automated tools to replace the manual spreadsheets currently used for payroll.
“This would reduce the potential of human error, enhance data accuracy and provide a reliable audit trail, facilitating the review of payroll transactions.”
