2024-03-15-KPMG_Global-Singapore_–_Salary_Hikes_for_Employment_Passes_in_2025_Announced_3页_211kb

Singapore - Salary Hikes for Employment Passes in 2025 Summary

Core Content

On 4 March 2024, the Singapore Ministry of Manpower (MOM) announced salary increases for Employment Passes (EP) effective from 1 January 2025. These changes are part of the ongoing effort to align EP qualifying salaries with local wage trends and promote complementarity between local and foreign talent.

Key Information

• Minimum Qualifying Salary for New EP Applications (Non-Financial Services Sector):
  Increases to S$5,600 from the current S$5,000, effective 1 January 2025.

• Minimum Qualifying Salary for New EP Applications (Financial Services Sector):
  Increases to S$6,200 from S$5,500, effective 1 January 2025.

• EP Renewals:
  The updated minimum salary will apply to EP renewals starting from 1 January 2026.

• S Pass:
  There will be no adjustment to the S Pass qualifying salary and levy in 2024. Increases for S Pass will continue to follow the 2022 budget increments.

Main Points

• The salary increases are the first under the Complementarity Assessment Framework (COMPASS), which is a points-based EP eligibility system.
• EP qualifying salaries are benchmarked to the top one-third of salaries for Singaporean professionals and increase progressively with age.
• In addition to the minimum salary threshold, EP candidates must meet or exceed the 65th percentile of salaries for Singaporean professionals in their industry.
• The COMPASS salary criteria are set to be updated by the end of March 2024, with the new criteria taking effect from September 2024.

Impact and Context

• The changes aim to ensure that foreign talent is only brought in when necessary, promoting a more competitive local job market.
• While the majority of EP holders will not be affected due to their current salaries exceeding the new thresholds, employers are advised to adjust their hiring strategies and manage their existing workforce accordingly.
• The early announcement allows employers to plan for the upcoming changes and align their compensation structures with the new requirements.

KPMG Insights

• KPMG advises employers to prepare for the 2025 salary changes and to consult with immigration professionals or the KPMG Singapore Immigration team for guidance.
• Several COMPASS-related updates are expected in 2024, including:
  • Salary benchmarks by age and industry
  • Top-tier educational institutions list
  • Skills bonus/shortage occupation list
• These updates will take effect from 1 September 2024.
• COMPASS assessments and academic degree verification will apply to EP renewals expiring from 1 September 2024.

Contact Information

For assistance with Singapore immigration and employment pass matters, contact:

• Murray Sarelius
  Partner
  Head of Personal Tax & Global Mobility Services
  Tel: +65 6213 2043
  Email: murraysarelius1@kpmq.com.sg

• Barbara Kinle
  Partner
  Personal Tax & Global Mobility Services
  Tel: +65 6213 2033
  Email: bkinle@kpmq.com.sg

• Jo Ann Adams
  Immigration Senior Manager
  Personal Tax & Global Mobility Services
  Tel: +65 6213 3165
  Email: joannadams@kpmq.com.sg

Notes

• The KPMG International member firm in the United States does not provide immigration or labor law services.
• KPMG Law LLP in Canada can assist with U.S. immigration matters.
• The information in this summary is based on the GMS Flash Alert of March 2022 and the MOM press release of 4 March 2024.
• Exchange rates for S$1 are provided for reference:
  • 1 S$ = €0.687
  • 1 S$ = US$0.747
  • 1 S$ = £0.587
  • 1 S$ = A$1.14
  • 1 S$ = 62.01 (likely referring to SGD to USD or another currency)
  • Source: www.xe.com

Disclaimer

The information provided is of a general nature and not intended to address the specific circumstances of any individual or entity. Employers are encouraged to seek professional advice to ensure compliance with Singapore’s immigration and employment policies.