Upcoming Changes to the Eligibility for Employment Pass

Upcoming Changes to the Eligibility for Employment Pass

Earlier in the year, during the Singapore Budget Statement 2022 on 18 February, it was announced by the Minister of Finance that there will be several changes introduced to our foreign worker policy framework to better allow businesses to access a diverse pool of manpower.

Notably, as part of these changes, there will be an update to the framework for Employment Passes (“EPs”) in Singapore, some of which will be taking effect on and from 1 September 2022.

Current Framework

Under the current EP framework, foreign professionals who fulfil the following criteria are eligible (but not guaranteed) for an EP:

  • Has a job offer in Singapore;
  • Works in a managerial, executive or specialised job;
  • Has acceptable qualifications, usually a good university degree, professional qualifications or specialised skills; and
  • Has a minimum qualifying monthly salary of:
  1. (All except financial services) $4,500 (increases progressively with age, up to $8,400 for candidate in mid-40s)
  2. (Financial Services) $5,000 (increases progressively with age, up to $9,300 for candidate in mid-40s)

To determine if a candidate meets the EP requirements above, they are strongly encouraged by the Ministry of Manpower (“MOM”) to use the Self-Assessment Tool (SAT) to assess their eligibility before applying.

Overview of New Framework

Recognising the need to keep pace with the rapidly evolving business environment, the MOM will be introducing a new two-stage eligibility framework, which will apply progressively from 1 September 2022.

A. Two-Stage Eligibility Framework

Stage 1: Earn at least the EP qualifying salary, which will be benchmarked to the top one third (1/3) of local PMET salaries by age.

Stage 2:Pass a new points-based Complementarity Assessment Framework (“COMPASS”), unless otherwise exempted (see below for details).

B. Timeline for Implementation

 

 

 

 

 

 

Revised Qualifying Monthly Salary

As mentioned above, the revised qualifying monthly salary will apply to:

  • New Applications – from 1 September 2022
  • EP Renewals – from 1 September 2023
Sectors Current minimum qualifying salary Revised minimum qualifying salary
All
(except financial services)
$4,500
(increases progressively with age, up to $8,400 for candidate in mid-40s)
$5,000
(increases progressively with age, up to $10,500 for candidate in mid-40s)
Financial services $5,000
(increases progressively with age, up to $9,300 for candidate in mid-40s)
$5,500
(increases progressively with age, up to $11,500 for candidate in mid-40s)

(Source: MOM webpage on Updates to EP Qualifying Salary)

Complementarity Assessment Framework (“COMPASS”)

In addition to meeting the qualifying salary above, it was announced on 4 March 2022 during the parliamentary debate on the budget for the MOM that EP candidates (unless exempted) will further be required to pass a new points-based Complementarity Assessment Framework (“COMPASS”):

  • New Applications – from 1 September 2023
  • EP Renewals – from 1 September 2024

How COMPASS works

COMPASS is intended to evaluate EP applications based on a holistic set of both individual and firm-related attributes (as set out below):

  Individual attributes Firm-related attributes
Foundation Criteria C1. Salary

Relative to local PMET salary norms for sector

C3. Diversity

Whether candidate improves nationality diversity in firm

C2. Qualifications

Based on candidate’s qualifications

C4. Support for Local Employment

Based on local PMET share relative to industry peers

Bonus Criteria C5. Skills Bonus

(Shortage Occupation List)

For candidate in job where skills shortages exist

C6. Strategic Economic Priorities Bonus

For partnership with Government on ambitious innovation or internationalisation activities

(Source: MOM webpage on Complementarity Assessment Framework (COMPASS))

Each EP application will be scored on four (4) foundational criteria and can earn points if they meet or exceed expectations.

Points for each foundational criterion Assessment
20 Exceeds expectations
10 Meets expectations
0 Does not meet expectations

(Source: MOM webpage on Complementarity Assessment Framework (COMPASS))

In addition to the above, an EP application can also earn additional points on bonus criteria if it meets the relevant qualifying conditions (e.g., shortage in skills, support strategic economic priorities).

To pass COMPASS, applicants require 40 points:

  • Applications that meet expectations (earn 10 points) on all 4 foundational criteria will pass (Example A-1and Example A-2).
  • Alternatively, applications can make up the required points by exceeding expectations on another criterion (Example B) or by scoring bonus points (Example C).

COMPASS Scoring

Foundational criteria Points
C1. Salary (Individual)
Fixed monthly salary compared to local PMET salaries in sector by age
·       ≥ 90th percentile 20
·       65th to < 90th percentile 10
·       < 65th percentile 0
C2. Qualification (Individual)
Based on candidate’s qualifications
·       Top-tier institution 20
·       Degree-equivalent qualification 10
·       No degree-equivalent qualification 0
C3. Diversity (Firm-related)
Share of candidate’s nationality among firm’s PMETs.*
·       < 5% 20
·       5 to < 25% 10
·       ≥ 25% 0
C4. Support for local employment (Firm-related)
Firm’s share of local PMETs within its subsector*
·       ≥ 50th percentile 20
·       20th to < 50th percentile 10
·       < 20th percentile 0
Bonus criteria
C5. Skills Bonus – Shortage Occupation List (Individual)
Job on the Shortage Occupation List +20#
C6. Strategic Economic Priorities Bonus (Firm-related)
Firm meets specific assessment criteria on innovation or internationalisation activities +10
# Skills bonus is reduced to +10 if the share of candidate’s nationality among the firm’s PMETs is one-third or higher.

* Small firms with fewer than 25 PMET employees score 10 points on C3 and C4 by default. PMETs are proxied by employees earning at least $3,000 per month.

(Source: MOM webpage on Complementarity Assessment Framework (COMPASS))

Criteria Details

Kindly find below a summary of the COMPASS criteria based on the MOM webpage:

  • Salary: All applicants must meet the EP qualifying salary, which increases with age. COMPASS further accounts for sectoral differences in salary norms. An EP application earns points by meeting sector-specific benchmarks for local PMET salaries. These benchmarks are also age-adjusted.
  • Qualifications: Employers are responsible for ensuring that the qualifications of its candidates are genuine and were awarded by accredited institutions. Candidates earn points depending on their qualifications (e.g., top-tier institution, degree-equivalent qualification). It should be noted that qualifications are not a mandatory requirement under COMPASS. Candidates who do not hold degree-equivalent qualifications can still pass COMPASS by earning sufficient points on other criteria.
  • Diversity: COMPASS awards more points to applications where the candidate’s nationality forms a small share of the firm’s PMET employees. No points are earned if your firm is applying to bring in a candidate whose nationality currently forms a significant share of its PMET employees. To note, the MOM considers all employees earning at least $3,000 per month in the firm as PMETs when computing this criterion. Additionally, an application scores 10 points by default if the employer employs fewer than 25 PMET employees.
  • Support for Local Employment: An application earns more points if the firm has a relatively higher share of locals among PMET employees, compared to its peers in the same subsector. To note, the MOM considers all employees earning at least $3,000 per month in the firm as PMETs when computing this criterion. Additionally, an application scores 10 points by default if the employer employs fewer than 25 PMET employees.
  • Skills Bonus (Shortage Occupation List): The Shortage Occupation List (“SOL”) recognises EP holders in occupations requiring highly specialised skills that are currently in shortage in the local workforce. The MOM has indicated that this could include niche infocomm-related roles supporting Singapore’s digitalisation drive. The SOL is determined by a robust tripartite evaluation process that takes into account industry needs and local workforce development efforts.
  • Strategic Economic Priorities Bonus: COMPASS recognises companies that are undertaking ambitious innovation, or internationalisation activities in partnership with the Government, in line with our economic priorities. Such companies should also have the scale or potential to provide good jobs for locals.

Exemption from COMPASS

An EP candidate will be exempted from COMPASS, however, if they fulfil any of the following conditions:

Case Studies

To assist in the understanding of the new EP framework, the MOM has also provided some case studies on how EP applications may be scored on COMPASS.

This article seeks to briefly introduce the upcoming changes to the framework for Employment Passes in Singapore in a summarized and engaging manner and should not be construed as legal advice in any form or manner. For more information on this matter, please feel free to contact Ms Jennifer Chih and Ms Maria Chang.