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Government Imposes New Restrictions on S Pass Employment Category




by:
Fragomen Del Rey Bernsen Loewy LLP - New York Office

 
March 4, 2013

Previously published on March 1, 2013

The Singapore government announced several measures to restrict the S Pass employment category, including higher salary minimums, an increase in monthly levies on sponsoring employers, and a reduction in the maximum number of foreign workers that S Pass employers can sponsor. The changes were announced in the government’s 2013 Budget Statement and will be implemented in phases between July 1, 2013 and July 1, 2015. The 2013 Budget Statement also includes changes for the Work Permit temporary employment category used by unskilled and semi-skilled foreign workers.

The S Pass category is open to specialized and technical personnel who meet specified minimum salary thresholds.

Increased Minimum Salary Requirements for S Passes

Effective July 1, 2013, the minimum fixed monthly salary for foreign nationals sponsored for new S Passes will increase to S$2,200 (approximately US$1,775) from S$2,000. The higher salary threshold will also apply to current S Pass holders who apply to change employers after July 1.

Current S Pass holders who do not meet the higher qualifying salary may benefit from transitional measures when renewing their status. Those whose passes expire before July 1, 2013 will receive a one-time renewal of up to two years, at the Ministry of Manpower’s discretion. Those whose passes expire between July 1, 2013 and December 31, 2013 will receive a one-time renewal of up to one year. From January 1, 2014, all applications for S Pass renewals must meet the higher qualifying salary.

Tiered Salary Requirements Based on Employee’s Age and Experience

Also beginning July 1, 2013, the S Pass category will feature a tiered minimum salary system that will be based on employee age and qualifications. Implementation details have not yet been determined, but older and more experienced workers will be required to meet higher salary requirements, commensurate with their work experience and the unique qualities they bring to their position. The tiered salary requirements are expected to resemble those of the Employment Pass category.

Increased Monthly Levies for Sponsoring Companies

Beginning July 1, 2014, employers that sponsor S Pass and Work Permit holders will be required to pay increased monthly levies for their foreign employees.

According to the Ministry of Manpower, employers can expect an average increase of S$90 (approximately US$73) in the monthly levy for every foreign employee holding an S Pass, while the increases for Work Permit holders will vary according to industry sector. The levies will increase gradually in stages through July 1, 2015.

Reductions in Maximum Number of S Pass and Work Permit Holders Sponsored

There will be a five percent reduction in the number of new temporary foreign workers holding S Passes and Work Permits that service sector companies can employ, effective July 1, 2013. Specifically, S Pass employers will be limited to 15 percent of foreign temporary workers. Limits in the Work Permit category will be reduced to 40 percent.

Greater Flexibility for Work Permit Holders in Service Sector Jobs

Work Permit holders employed by service sector companies will have greater flexibility to conduct activities that may be outside of the occupation specified in their permit, beginning July 1, 2013. Generally, Work Permits are heavily regulated and employers must strictly limit permit holders’ work activities to those specified in their permit.

Implementation details for the new program have yet to be determined. The Ministry of Manpower will consult with the National Trades Union Congress and the Singapore National Employers Federation to produce implementation guidelines.



 

The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.
 

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