KUALA LUMPUR - The Ministry of Manpower (MOM) has announced further changes to foreign workforce policies under Budget 2026.

The updates cover higher minimum salaries for Employment Pass (EP) and S Pass holders, a higher Local Qualifying Salary (LQS) for quota purposes, and revised Work Permit levies from 2028.

These measures are separate from the earlier COMPASS framework changes that will take effect on January 1, this year.

From January 1, next year for new applications and January 1, 2028 for renewals, the minimum qualifying salary for EP holders in all sectors except financial services will rise from SGD5,600 to SGD6,000.

For the financial services sector, the EP minimum salary will increase from SGD6,200 to SGD6,600.

The S Pass minimum salary will increase from SGD3,300 to SGD3,600 for most sectors.

In the financial services sector, the S Pass minimum salary will rise from SGD3,800 to SGD4,000.

Salary requirements for older and more experienced candidates will also increase.

Employers may need to adjust pay for roles currently close to the existing EP and S Pass thresholds if applications or renewals take place from 2027 onwards.

From July 1, 2026, the LQS will be raised from SGD1,600 to SGD1,800 for full-time local workers.

The Progressive Wage Credit Scheme will be enhanced in 2026 and extended until 2028 to help businesses cope with higher wage costs.

Companies may need to review salaries of local workers earning between SGD1,600 and SGD1,800 as those not meeting the new LQS may not be fully counted towards S Pass and Work Permit quotas.

From 2028, the Government will also adjust Work Permit levy rates, with higher levies expected for basic-skilled workers in some sectors such as marine and process.

For manufacturing and services, the levy system will be simplified into fewer tiers to encourage firms to hire higher-skilled workers and improve productivity.

The early announcement is meant to give businesses time to plan their workforce and manage future costs.