This working paper analyses major problems, issues and challenges facing the utilities (water and electricity) sector in Malawi, and the state of social dialogue in the sector. The paper also documents reforms undertaken in the past decade and analyses how these have impacted on employment levels, working conditions of staff, training, compensation schemes, industrial relations, and on access to and quality of the supply of water, sanitation and electric energy. In addition, the paper provides recommendations as to how stakeholders should address both current issues and future challenges to ensure smooth social dialogue in the reforms of the utilities.