Introduction

The Ministry of Manpower (“MOM”) in Singapore has introduced a new system for Employment Pass (“EP”) renewals, applicable for EPs expiring on or after 1 September 2024. Prospective renewal applicants must navigate a two-stage eligibility framework.

Stage 1: Qualifying Salary

In the first stage, applicants must meet the EP qualifying salary threshold. This benchmark is aligned with the top one-third of local Professionals, Managers, Executives, and Technicians salaries by age.

• For all sectors except financial services, the qualifying salary ranges from S$5,000 at age 23 to S$10,500 for those aged 45 and above.
• In the financial services sector, the minimum qualifying salary starts at S$5,500 at age 23, increasing to S$11,500 for those aged 45 and above.

Effective 1 January 2025, the EP qualifying salary for new applications will be adjusted to at least S$5,600 for sectors apart from financial services, and at least S$6,200 for the financial services sector. This revised salary threshold will also apply to the renewal of EPs expiring from 1 January 2026.

Stage 2: Complementarity Assessment Framework (COMPASS)

In the next stage, applicants must pass the points-based Complementarity Assessment Framework (COMPASS), unless exempted. To be successful, applicants need to accumulate at least 40 out of a possible 110 points across six factors:

1. Salary of the Applicant: Reflects competitiveness in remuneration.
2. Qualifications of the Applicant: Considers educational and professional credentials. Education certificates will also need to be verified by the processes as determined by MOM. As such, some certificates would need to be verified by third-parties.
3. Nationality Diversity: Assesses the contribution to the employer’s nationality diversity.
4. Support for Local Employment: Evaluates efforts to enhance local employment.
5. Sector-Specific Skills Shortages: Identifies critical skill gaps in the sector.
6. Strategic Economic Priorities: Aligns with national economic priorities.

Applicants earning a fixed monthly salary of at least S$22,500 are exempt from COMPASS, mirroring the current Fair Consideration Framework job advertising exemption, effective from 1 September 2023.

Additional Changes

Feedback from our Single Family Office (“SFO”) clients indicate that MOM has intensified verification checks on EP holders. This includes on-site visits to the SFO’s operating address to verify the EP holder’s presence, interviews with the EP holder and colleagues to confirm the legitimacy of employment, and requests for work records.

Conclusion

SFOs have to act now to comply with the new EP application and renewal requirements. This involves evaluating current and prospective EP holders against the increased scrutiny of the new regime, new salary thresholds, and the COMPASS criteria. Preparing ahead will safeguard your access to top-tier international talent and maintain the competitive edge of your SFO in Singapore’s dynamic landscape. Our firm has a breadth of experience helping clients establish SFOs in Singapore and advising on work visa applications. Should you require our assistance in navigating the requirements of SFOs or EP applications and renewals for the same, please feel free to contact our Business Development team to arrange a meeting with one of our lawyers.