Masterclass on Singapore's New Point-Based EP Framework
TL;DR
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Singapore is home to many foreign skilled professionals. EP (aka Employment Pass) is one of the famous work passes most foreign professionals hold in Singapore.
Disclaimer
The content of this article is based on information sourced from the MOM website as of September 23, 2023. Readers are advised to consult the MOM website directly to verify details and for the most up-to-date information. A reference link is provided at the end of this article.
Recently, the Ministry of Manpower (MOM) of Singapore changed the process of getting an EP by introducing the COMPASS framework. In addition to meeting the EP qualifying salary, new Employment Pass (EP) candidates must pass the points-based COMPASS (Complementarity Assessment) beginning September 1 2023. In simple words, the candidate must pass the two stages mentioned below.
- Stage 1: EP Qualifying Salary
- Stage 2: COMPASS
The new EP process is initially limited to new EP applications. However, beginning September 1, 2024, it will also extend to EP renewals. So, if the EP expires before September 1, 2024, and there’s no change in the employing company (thus, no new EP application), such candidates won’t be subject to the new points-based EP process for the current renewal.
Stage 1: EP Qualifying Salary
The EP qualifying salary depends on two factors, which are the candidate’s age and the candidate’s employment sector. The Ministry of Manpower (MOM) of Singapore divides all sectors into two for stage 1: the financial and non-financial sectors.
Here is a snapshot of the qualifying salary for the non-financial sector based on age.
Here is a snapshot of the qualifying salary for the financial sector based on age.
Firstly, the candidate needs to know the sector, whether the business is the financial or non-financial sector. Then, the minimum salary requirement is determined based on the candidate’s age.
Let’s take my friend Babar Azam as an example. Babar was born in 1994, and he is 29 years old now.
- If Babar is in the non-financial sector, for Babar to qualify for stage 1, Babar needs to earn a minimum of $6500 fixed monthly salary.
- If Babar is in the financial sector, for Babar to qualify for stage 1, Babar needs to earn a minimum of $7,136 fixed monthly salary.
Candidates like you and me must uncover the minimum salary criteria, just like my friend Babar did.
Stage one is passed ✅ if the candidate’s salary exceeds the minimum salary requirement.
Stage 2: COMPASS
The latest addition to the EP process is the COMPASS framework. MOM introduced the COMPASS framework to help employers identify highly qualified and skilful international candidates while ensuring workforce diversity. Candidates need to get 40 points to pass the COMPASS.
When You Don’t Need COMPASS?
You don’t have to worry about COMPASS if you fit into any of these categories:
- Your fixed monthly salary is $22,500 or more.
- You’re being transferred to a job in Singapore from another branch of your international company.
- You’re only taking the job for a short time, like one month.
The COMPASS framework has six attributes, divided into two criteria: Foundational and Bonus. The first four attributes are foundational; you can earn up to 20 points each. The last two attributes are bonuses: one gives up to 20 points, and the other gives up to 10 points. These attributes further fall into two types: individual and company-based.
A candidate can calculate points from individual attributes as the candidate knows his/her profile. Still, without company data, the candidate can’t understand how many points can be gained from company attributes, making it impossible to understand the total possible points.
Individual attributes in the foundational criteria
Attribute 1: Salary
Let me explain the 90th percentile and 65th percentile first.
Imagine a large group of employees in a particular sector. Everyone’s salary is ranked from the lowest to the highest. Here’s how the point system works based on where a person’s salary stands compared to others:
- 90th Percentile and Above: If a candidate’s monthly salary is higher than 90% of those in that sector, they’re in the top 10%. This top group earns 20 points for being among the highest earners.
- 65th to 90th Percentile: If their salary is higher than 65% of their peers but not quite in the top 10%, they fall into this bracket. So, they’re doing better than most, but not at the top 10%. They receive 10 points for being in this range.
- Below the 65th Percentile: If their salary is less than 65% of the people in the sector, they don’t earn any points from this system. In simpler terms, they are in the bottom 65% of earners and thus get 0 points.
90th and 65th percentiles differ based on the sector and the candidate’s age. Candidates can check the MOM website to see how much salary is needed in each sector by age.
Let’s use my friend Babar Azam, who’s 29, as an example:
In the Banking and Financial sector:
- Babar gets 20 points if his fixed monthly salary is $15,631 (90th percentile) or more.
- He gets 10 points if he earns over $9,546 (65th percentile).
- If he earns less than $9,546, he gets no points.
In the Information-Communication Technology sector:
- Babar earns 20 points with a fixed monthly salary of $12,047 or higher.
- He gets 10 points if he makes at least $7,637.
In 2024, when Babar is 30, here’s how his points work in the Banking and Financial sector:
- He gets 20 points if he earns more than $16,616 (90th percentile) monthly.
- He gets 10 points if he earns more than $10,056 (65th percentile) monthly.
Like in the example above, the points a candidate gets can change based on the candidate’s job sector and age.
Attribute 2: Qualifications
For those who studied at:
- Top 100 universities on the QS World Rankings
- Famous universities in Asia
- Singapore’s main universities
- Schools that are super famous for a specific subject and approved by special agencies
They get 20 points.
For those with degrees like:
- Foreign degrees that are similar to a UK bachelor’s degree.
- Professional degrees that many people in the industry respect and are approved by specific agencies.
They get 10 points.
For those without such degrees:
They get 0 points.
(Remember, if they get at least 40 points from other things, they can still pass COMPASS.)
Company attributes in the foundational criteria
Attribute 3: Diversity
Points for Diversity:
- If the company has less than 25 PMET (Professionals, Managers, Executives, and Technicians), the candidate automatically gets 10 points.
- If the company has 25 or more PMETs, the points the candidate gets depend on how many of them share the same nationality as the candidate.
Here’s the breakdown:
- Less than 5% from the candidate’s country: 20 points
- Between 5% to 25%: 10 points
- 25% or more: 0 points
Remember: When checking nationalities, the MOM looks at the employees’ passports as per government records, including those who are Permanent Residents.
Here’s an example: Babar is from Sri Lanka.
Here’s how the points work for him:
- If, in Babar’s potential workplace, less than 5% of the PMETs are from Sri Lanka, his application would get 20 points.
- If between 5% and 25% of the PMETs at the company are from Sri Lanka, Babar’s application would get 10 points.
- But, if 25% or more of the PMETs are from Sri Lanka, then Babar’s application would get 0 points.
This encourages companies to maintain a diverse workforce with a mix of nationalities.
Attribute 4: Support for Local Employment
How it Works:
- Companies with fewer than 25 PMETs will get 10 points straight away.
- For bigger companies with 25 or more PMETs, the points they get will depend on how many local PMETs they hire compared to other companies in the same industry.
Points Breakdown:
- If the company hires more locals than 50% of companies in the same industry, the application gets 20 points.
- If the company is doing better than 20% but less than 50% of companies hire locals, the application gets 10 points.
- If the company is in the bottom 20% of hiring locals, then the application gets 0 points.
Imagine there’s a company named “Jeffries.” They want to support the local community by giving job opportunities to locals, but they also know the value of bringing in international talent.
Here’s how the points system works for Jeffries:
If Jeffries has fewer than 25 PMETs, the application automatically gets 10 points. No calculations are needed!
But let’s say Jeffries is a bigger company, having more than 25 PMETs.
Here’s a breakdown of the points EP applications from Jeffries could get:
- If Jeffries hires more locals than half of the other companies in their line of work, they earn 20 points. They’re doing great!
- If Jeffries is in the middle, doing better than 20% of companies but not surpassing half in hiring locals, they secure 10 points.
- But if Jeffries isn’t keeping up and falls in the bottom 20% for local hires, they unfortunately don’t earn any points, getting a score of 0.
Individual attributes in the bonus criteria
Attribute 5: Skills Bonus
There’s a special list called the Shortage Occupation List (SOL). Jobs on this list are special because they need skills that few locals have.
How do they decide what jobs go on this list? They look at what industries need and how they train the local workforce.
If the candidate’s job is on this list (SOL) and:
- Less than 1 in 3 (less than 33%) professionals at their workplace are from the candidate’s country; the candidate gets 20 points.
- 1 in 3 or more (more than 33%) professionals at their workplace are from the candidate’s country; the candidate gets 10 points.
Here is an example: Babar is from Sri Lanka and works in a job that’s on the Shortage Occupation List (SOL), which means it’s a job that needs special skills not many locals have.
Here’s how the points work for him:
- If in Babar’s workplace, less than 1 in 3 professionals (or fewer than 33%) are from Sri Lanka, Babar will earn 20 points.
- But if 1 in 3 professionals (or 33% and above) at his workplace are from Sri Lanka, then Babar will get 10 points.
Company attributes in the bonus criteria
Attribute 6: The Strategic Economic Priorities Bonus
Singapore values companies that bring new ideas and opportunities to its economy. This special bonus points for these companies.
How can a company get bonus points?
- The company is making big moves in investment or is bringing new ideas to Singapore in partnership with official economic agencies.
- The National Trades Union Congress recognizes the company for helping transform the business and its employees positively.
If a company does any of the above, their EP applications can get 10 points.
How will they know if they get the points?
The agencies that run the programs will decide if a company deserves the bonus. If the company gets this bonus, the Ministry of Manpower (MOM) will let the company know.
Using our friend Babar’s company as an example:
Imagine Babar works at a company called “Jeffries.” If Jeffries makes significant investments in Singapore or introduces innovative projects in collaboration with official agencies, they can be rewarded with these bonus points. So, if Jeffries is recognized for their efforts and gets these 10 points, it’ll be easier for them to hire talent like Babar from other countries.
Reference: Ministry of Manpower. (2023). Eligibility for Employment Pass. Retrieved on September 23, 2023, from https://www.mom.gov.sg/passes-and-permits/employment-pass/eligibility
That’s a wrap for today. If you found this guide informative, please don’t hesitate to comment below and share it with colleagues or friends who are considering a career move to Singapore. Your insights and feedback are invaluable to us, and sharing this guide can assist many in effortlessly understanding the nuances of the Employment Pass system. I wish you the best of luck with your professional endeavours in Singapore!
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