Minimum Salary for E Pass & S Pass to be Raised & Here’s Why (Simplified for You)

Lest you didn’t know, there are three main types of work passes for foreign workers in Singapore.

The first is work permit; these are for foreign workers from approved source countries working in the construction, manufacturing, marine shipyard, process or services sector. The countries here are pretty limited: they can only be from certain countries like Malaysia, China or Bangladesh, and this depends on your sector. For this, there’s no minimum salary, but there’s a quota.

The second is S Pass, and for this, the foreign workers must be paid a minimum salary of $2,400 and must have at least a diploma. There’s a quota for this, too, but this pass is for all nationalities.

And finally, there’s the Employment Pass, commonly known as E Pass. Some of the workers holding this pass like to hang out in Robertson Quay because these workers must have good academic qualifications and earn at least $3,900 (though more experienced workers won’t need a degree but need higher pay). For this, there’s no quota at all.

In other words, you can say that work permit holders eat at a kopitiam, S Pass holders eat at a restaurant in Jurong Point and E Pass holders have fine dining in Orchard.

And after knowing this, you should know the reason for the headline.

Minimum Salary for E Pass & S Pass to be Raised & Here’s Why

For a start, Singapore needs work permit holders, if not no one would be manning the petrol station and your BTO would never be completed. They’re taking the jobs that Singaporeans refused to take and then complained on social media that they can’t find a job.

And now, with COVID-19 killing jobs all across Singapore, you can bet that Ah Gong is going to do whatever it takes to keep Singaporeans employed.

This could be one of the ways.

Today, Manpower Minister Josephine Teo has just announced something that’d make Robertson Quay regulars shiver.

In her ministry’s addendum to the President’s earlier speech, which is kind of like what the ministry intends to do next as parliament reopens, she said that her ministry intends to increase the salary criteria for E Passes and S Passes.

Remember: currently, S Pass needs a minimum of $2,400 monthly salary (with quota) and E Pass needs a minimum of $3,900 monthly salary (without quota).

The amount to be increased isn’t announced, but the reason is.

It’s, of course, to encourage employers to engage Singaporeans instead due to “slacker labour market conditions owing to COVID-19.”

Mrs Teo said, “Even as we stay open to the world to accelerate our recovery, the crisis makes it all the more important that employers give fair treatment to Singaporeans.

“They should also seek to achieve greater diversity within their EP and S Pass workforce where practical.

“We will ensure that employers uphold both the letter and spirit of the Fair Consideration Framework. We will closely examine retrenchment exercises to ensure they are carried out fairly.”

But why is this a solution?

Let’s create a scenario. Imagine you’re the HR Director of FriendsBook, a social media platform that only people above 50 would log in daily. Your company has set up its APAC HQ in Singapore, and you’re responsible for hiring.

You need to engage a Marketing Manager and given that it’s a high position, you want the best. But because you’re in Singapore, you need to try finding a Singaporean first. You failed and therefore look elsewhere.

But hey: if the minimum salary has been increased, you might not have the budget to engage Seth Godin. And so, you engage a Singaporean instead.

See how this could benefit us Singaporeans, though it might affect the company a little?

So, why not just reduce the quota?

That’s for Jamus Lim to ask in Parliament, but if you’ve read everything here, you’d know that’s not possible for E Pass since there’s no quota to begin with. And here’s the thing: it’s this bracket of workers that need the job.

Given that retrenchment would hurt those with higher salaries (i.e. Singaporeans competing for jobs with E Pass holders), this looks to be an extension of that President Halimah has said.

In her opening address to Parliament, she mentioned that competition from work pass holders has become “a major source of anxiety, especially among mid-career Singaporeans” and that they “understand these concerns. They not only touch on matters of livelihood, but also on our sense of identity and belonging. They will be addressed.”

Changes in Salary Criteria Last Made in May This Year

In May this year, the E Pass salary threshold was raised from $3,600 to $3,900 for new applicants, and there would be a renewal in May next year. Before that increase, it was last raised in 2017.

As for S Pass salary threshold, it was raised from $2,300 to $2,400 this January. Before that, it was last raised in 2018, when the threshold before that was $2,200.

And as usual, Mrs Teo echoed what many have said: companies should do more to develop and strengthen their “Singaporean core”.

Don’t be surprised if in the near future, a company would look like an army camp, and you can finally speak Singlish without wondering that your colleagues catch no ball.

And by the way, if you’re wondering why Singapore doesn’t have a minimum wage, even for work permit holders, you might want to watch this video (and also subscribe to our YouTube channel, please?):