Introduction
Organisations in Singapore are asking the same question in 2026: are we overpaying or underpaying our tech team? Accurate benchmarking matters for retention, hiring, and compliance.
This article, 2026 Salary Benchmarks: Are You Overpaying or Underpaying Your Tech Team?, explains how employers should approach salary benchmarking for software engineers, data scientists and related roles while aligning to Singapore rules such as CPF Act, Employment Act and MOM requirements.
Who this applies to
This guidance is for HR leaders, founders, hiring managers and finance teams in Singapore who employ or plan to hire tech professionals. It applies to employers of local staff, Singapore Permanent Residents and foreign employees on Employment Pass, S Pass or Work Permit.
It is also relevant for smaller agencies and startups using the ACRA BizFile+ portal for company filings, and for those managing payroll via IRAS myTax Portal reporting processes.
Key rules and requirements in Singapore
When benchmarking pay in 2026, you must consider statutory, tax and employment obligations. Key frameworks and provisions include:
- CPF Act — CPF contributions apply to Singapore citizens and PRs; employers must calculate and contribute correctly.
- Employment Act and Manpower Act — determine entitlement to overtime, rest days and other protections depending on employee classification.
- Employment of Foreign Manpower Act and MOM guidelines — Employment Pass and S Pass holders must meet qualifying salary thresholds and other criteria set by MOM.
- Employment Agencies Act — if engaging third-party recruiters, ensure the agency is licensed and compliant.
- IRAS obligations — payroll and benefits need correct tax treatment; employer reporting must be accurate (via IRAS or CPF submission channels).
- SDL, WICA and WSH considerations — employers are responsible for Skills Development Levy and workplace injury cover where applicable; ensure compliance with Work Injury Compensation Act and Workplace Safety and Health Act for employees.
- PDPA and POHA — personal data handling and workplace harassment policies influence recruitment and compensation processes.
Remember: Employment Pass and S Pass rules set minimum qualifying salaries and influence how competitive your total package must be to attract foreign talent. Requirements may change, so always check the latest guidance from MOM, or consult a professional adviser.
Step-by-step process
Follow a structured approach to determine appropriate 2026 salary bands for tech roles.
- Audit current roles and total rewards.Document job descriptions, responsibilities, current base salary, CPF contributions, bonuses, stock options and benefits such as medical, leave and training budgets.
- Profile roles precisely.Differentiate by skill set (e.g. backend, frontend, ML), seniority, technical stack and leadership responsibilities. Avoid generic job titles that skew comparisons.
- Use multiple benchmarking sources.Combine MOM labour market guidance, reputable salary surveys, industry reports and conversations with recruitment partners. Consider ACRA filings and public disclosures for competing firms.
- Consider total cost to company (TCC).Benchmark both base salary and non-salary costs: employer CPF, SDL, medical insurance, bonuses, shares and training. For foreign hires, include visa-related fees and relocation costs.
- Set salary bands and review cycles.Create minimum, median and maximum bands per role. Plan annual reviews tied to performance and market movement; document the methodology in HR policy.
- Ensure statutory and contractual compliance.Update employment contracts via ACRA BizFile+ for changes affecting employment terms, and ensure payroll processes meet IRAS and CPF submission deadlines.
- Communicate changes clearly.Provide transparent communication to staff about the rationale for pay levels, review timing and any benefit adjustments.
Common mistakes to avoid
- Relying on a single salary source. Use multiple data points to avoid distortion by outliers.
- Ignoring total rewards. Focusing only on base pay can misrepresent competitiveness, especially where equity and variable pay are common.
- Misclassifying workers. Declaring employees as contractors when they function as staff can breach CPF Act and IRAS rules.
- Failing to account for CPF and SDL. Underestimating employer contributions leads to budgeting and compliance risks.
- Overlooking MOM criteria for foreign hires. Offering below the required qualifying salary for Employment Pass or S Pass candidates can lead to rejected applications or reputational impact.
- No documented review process. Infrequent or ad hoc reviews cause retention problems and pay inequities.
Practical examples
Below are anonymised, illustrative scenarios commonly seen in Singapore.
- Start-up underpaying mid-level engineers.A seed-stage firm offered lower base pay but generous stock options. After one year, several hires left for higher base-pay roles. Solution: rebalance packages to increase base salary to market median while retaining equity for long-term incentives; update contracts and ensure IRAS reporting for share-based compensation.
- Misjudged foreign hire package.An employer offered a candidate a competitive global salary but below MOM’s Employment Pass qualifying salary. The EP was rejected. Solution: review MOM’s EP/S Pass qualifying salaries when budgeting and factor visa compliance into the offer.
- Contractor vs employee classification.A company treated a developer as a contractor to avoid CPF payments; an audit found the role met employee criteria. Solution: reclassify, make CPF back-payments if necessary, and put robust contracting templates in place for future hires.
How an experienced consultant can help
An experienced immigration and employment consultant can help you design compliant total reward strategies, benchmark roles against current Singapore market data, prepare Employment Pass and S Pass documentation and advise on CPF, SDL and IRAS reporting.
Little Big Employment Agency can assist with application preparation, compliance checks and advisory support to mitigate regulatory risk and improve hiring outcomes.
Frequently Asked Questions
How often should I benchmark salaries?
Annually is typical for most organisations, with interim checks if market conditions shift rapidly or if you experience retention problems.
Do CPF contributions apply to foreign employees?
CPF generally applies to Singapore citizens and Permanent Residents. Employment Pass, S Pass and Work Permit holders are not subject to CPF unless they have PR status or are otherwise covered under CPF Act provisions.
Should I include equity when benchmarking?
Yes. Equity and long-term incentive plans are common in tech and should be valued as part of total rewards when comparing packages.
What happens if I underpay and an employee complains?
Underpayment claims can lead to audits, back-payments, CPF liabilities and reputational damage. Maintain clear records and engage a consultant or legal adviser promptly.
Key takeaways
- Benchmark using multiple sources and measure total cost to company (base pay, CPF, SDL, benefits and equity).
- Ensure compliance with CPF Act, Employment Act, Employment of Foreign Manpower Act and MOM guidelines when hiring foreign tech talent.
- Document role profiles and salary band methodology; review salaries at least annually.
- Avoid common errors such as misclassification, ignoring statutory employer contributions and relying on single data points.
- Consult experienced advisers for complex cases; Little Big Employment Agency can provide practical support with benchmarking, applications and compliance.
If you would like to find out more about how Little Big Employment Agency can assist with your employment and immigration requirements, please get in touch with the team at [email protected].
Yours sincerely,
The editorial team at Little Big Employment Agency
Requirements may change, so always check the latest guidance from MOM, or consult a professional adviser.
Disclaimer: This does not constitute legal advice. If you require legal advice, please contact a lawyer.