SINGAPORE — Singapore will raise the minimum qualifying salary for new Employment Pass (EP) and S Pass applicants, as it reviews and adjusts key parameters in its foreign worker policies.
Finance Minister Lawrence Wong said in his Singapore 2022 Budget speech on Friday (18 February) that the minimum qualifying salary for new EP applicants will be raised from the current $4,500 to $5,000. For the financial services sector, which has higher salary norms, this will be raised from the current $5,000 to $5,500.
The qualifying salaries for older EP applicants, which increase progressively with age, will also be raised in tandem. For renewal applications, these changes will apply from September next year to give businesses sufficient time to adjust.
"We will aim to ensure that incoming EP holders are comparable in quality to the top one-third of our local PMET (professional, managerial, executive and technical) workforce," Wong said in his speech.
"Beyond the qualifying salary, we will refine how we assess EP applications, to improve the complementarity and diversity of our foreign workforce, and also to increase certainty and transparency for businesses."
Minimum qualifying salary for new S Pass applicants to be raised
Meanwhile, the minimum qualifying salary for new S Pass applicants will be raised from the current $2,500 to $3,000 in September this year.
It will be raised again in September 2025, although the specific salary values will be announced closer to implementation date, based on the prevailing local wages then.
A higher minimum qualifying salary of $3,500 for the financial services sector will also be introduced for S Pass applicants. In addition, the Tier-1 levy for S Pass holders will be progressively raised from the current S$330 to S$650 by 2025.
Work permit policies in construction, process sectors to be adjusted
Work permit policies in the construction and process sectors will be adjusted, to spur greater productivity improvements and support more manpower-efficient solutions. This will help transform the sectors that have been more heavily dependent on foreigners.
The Dependency Ratio Ceiling (DRC) will be reduced from the current 1:7 to 1:5, while the current Man-Year Entitlement (MYE) framework will be replaced with a new levy framework that will encourage firms to support more offsite work and employ more higher-skilled work permit holders.
To give companies time to prepare for the moves, they will take effect from 1 January 2024.
"The adjustments in our foreign worker policies apply mainly to the broad middle of the workforce. This is where we have Singaporeans doing the jobs, but we need to continually adjust our rules to ensure complementarity between our foreign and local workforce," Wong said.
"At the higher end of the workforce, where there are acute skill shortages, we will continue to bring in professionals with the right abilities to be part of Team Singapore."
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