Employers who hire Employment Pass (EP) and S Pass holders will need to pay them higher salaries from September 2022.
This was announced by Finance Minister Lawrence Wong at Budget 2022, saying the minimum qualifying salary for new EP applicants will be raised from $4,500 to $5,000.
For the financial services sector, Wong announced that employers will have to pay EP holders $5,500, up from $5,000 currently, as it has higher salary norms.
“To ensure that EP holders are of the right calibre, we adjust the minimum qualifying salary because how much the employer is prepared to pay is a practical indicator of the quality of the EP holder,” Wong said.
He added that the aim is to ensure incoming EP holders are “comparable in quality to the top one-third of our local PMET workforce,” referring to professional, managerial, executive and technical jobs.
For EP renewal applications, these changes will apply from September 2023, so as to give businesses sufficient time to adjust, Wong said.
Separately, new applicants for S pass holders will need to be paid a minimum salary of $3,000, up from the current level of $2,500. For the financial services sector, a higher minimum salary of $3,500 will be introduced for the financial services sector.
The qualifying salaries for older S Pass holders will be also raised in tandem.
Wong highlighted that the goal is for these S pass holders to be comparable in quality to the top one-third of local associate professionals and technicians.
See also: Forging ahead with courage
Thereafter, the minimum qualifying salary for new S Pass applicants will be raised in September 2024, and again in September 2025.
The specific salary values will be announced closer to the implementation date based on the prevailing local wages then.
Similar to EPs, the changes for S Passes will apply to renewal applications one year later, to give businesses time to adjust.
To better manage the flow of S Pass holders, Wong also announced that the Tier 1 levy will be progressively raised from the current $330 to $650 by 2025.
"Let me emphasise that Singapore will continue to stay open and welcome talent from around the world. The adjustments in our foreign worker policies apply mainly to the broad middle of the workforce. This is where we have Singaporeans doing their jobs," Wong said.
He added that "At the higher end of the workforce where they are acute skills shortages, we will continue to bring in professionals with the right abilities to be part of Team Singapore."
Photo credit: Albert Chua
