Budget debate: New scoring system for Employment Pass applicants from Sept 2023

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SINGAPORE - Foreign professionals looking to work in Singapore will soon need to pass a new points-based evaluation process that takes into account factors such as their qualifications and if they are being hired by a company that overly relies on workers from a single nationality. 

From Sept 2023, new Employment Pass (EP) applicants not only have to meet higher salary thresholds, but also score enough points under the new Complementarity Assessment Framework (Compass).

The move will make the process clearer and more transparent for employers, said Manpower Minister Tan See Leng on Friday (March 4).

"Compass is not designed to make it harder for businesses to obtain an EP. A good majority of applications today would not have issues," he said.

"Some firms, however, would need to make adjustments... and they would know exactly which areas to improve on."

Future EP applications will hence undergo two stages. First, applicants must meet the qualifying salary. Next, they must score at least 40 points under Compass.

"While the qualifying salary is simple to understand and easy to administer, it is also a blunt tool. There are limits to relying solely on it to select complementary foreign talent," explained Dr Tan during the debate on the Ministry of Manpower's (MOM) budget.

The move is part of a series of policy tweaks to boost the Singaporean core, complemented by a high-quality and diverse foreign workforce.

Each applicant's qualifications and salary relative to local PMET (professional, manager, executive and technician) wages in their sector will be evaluated, as well as the hiring firm's workforce diversity - in terms of hiring across different nationalities - and support for local employment.

Bonus points are given to jobs where there is a lack of skilled workers, such as artificial intelligence developers and cyber-security specialists, and firms that partner the Government on ambitious innovation and internationalisation activities.

For renewals, Compass will apply from September 2024.

The scoring rubric will be published on MOM's website. Employers can also obtain the indicative scores for each application before submission.

Small and medium-sized enterprises, whose workforce ratios could change drastically with a few staff adjustments, will not be disadvantaged by this arrangement, said Dr Tan.

Those with fewer than 25 PMETs (professionals, managers, executives and technicians) will automatically be scored as "meeting expectations" on two of the four main attributes.

At the EP level, the focus is on ensuring quality of foreign professionals working here, Dr Tan pointed out. "Hence, we do not set quotas or levies on EPs."

The Compass scheme comes on top of earlier announced higher salary cut-offs to ensure the calibre of EP holders are comparable with the top one-third of local PMETs.

From September, the qualifying salary for new EP applicants will be raised from the current $4,500 to $5,000. For the financial service sector, which has higher wage norms, the bar will be raised from $5,000 to $5,500.

For renewals, the changes will apply from September 2023.

"This latest move is not intended as a tightening measure," said Dr Tan, acknowledging that the market for skilled workers is sufficiently tight.

"Instead, it is part of MOM's regular updates to ensure that our qualifying salary keeps pace with local wage growth, so that foreigners are not coming in just because they are cheaper than local PMETs."

Most EP holders will not be affected, as they earn "well above the qualifying salary", he added.

"There are, however, some EP holders who do not meet our quality bar… but this is how we constantly ensure that we maintain a high-quality EP stock."

Even with the changes, MOM will ensure the EP approval process has the flexibility to allow global firms with rotation programmes to send foreign and local employees - including young ones - for overseas postings.

A global rotation scheme will be piloted to facilitate the entry of high-potential staff. In return, the firms must post Singaporeans overseas under the same programme.

Dr Tan said the various foreign workforce policy adjustments will kick in gradually to give businesses here time to plan ahead.

"Singapore is and will always be committed to remaining open to foreigners who complement our local workforce, and who are able to add vibrancy to Singapore’s economy," he added.

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