The “Hidden” Rule of EP Renewals: Why Meeting the Salary Floor Isn’t Enough

Many employers treat an Employment Pass renewal as a formality: the salary is above the MOM floor, the employee is performing well, so the renewal should go through. The “hidden” rule of EP renewals is that a renewal is assessed almost like a fresh application. Meeting the salary floor isn’t enough, because the floor itself moves with the employee’s age, the COMPASS benchmarks move every year, and your company’s own profile is scored again at the point of renewal.

Who this applies to

This guide is relevant to:

• Singapore employers with one or more Employment Pass holders whose passes expire in the next 6 to 18 months
• HR and finance teams that set annual salary reviews for foreign professionals
• SMEs that hired their first EP holders several years ago and have not reviewed the renewal criteria since

Passes paying a fixed monthly salary of at least SGD 22,500 are exempt from COMPASS, although the other renewal conditions still apply. For everyone else, both the qualifying salary and the COMPASS points test are applied on renewal.

Key rules and requirements in Singapore

The qualifying salary is age-graded, and age is measured at renewal

The headline EP qualifying salary is SGD 5,600 a month (SGD 6,200 in financial services). That figure is the starting point for younger candidates. The requirement rises progressively with age, reaching around SGD 10,700 (SGD 11,800 in financial services) for candidates in their mid-40s. MOM has also announced that the floor will rise to SGD 6,000 (SGD 6,600 in financial services) for new applications from 1 January 2027, with renewals following from 1 January 2028, and the age-graded figures will rise with it.

Here is the part that catches employers out. The relevant age is the employee’s age when the renewal is assessed, not their age when they were first hired. A professional who joined at 34 on a salary comfortably above the requirement may, at 39 or 41, need a noticeably higher salary simply because they have moved into an older band. Annual increments of 2 to 3% often do not keep pace.

COMPASS applies to renewals

Since September 2024, EP renewals have been assessed under the Complementarity Assessment Framework (COMPASS). The pass must score at least 40 points across four foundational criteria:

• C1 Salary: how the fixed monthly salary compares with local PMET salaries in the same sector and age band (0, 10 or 20 points)
• C2 Qualifications: the candidate’s highest qualification
• C3 Diversity: the share of the candidate’s nationality among the firm’s PMETs
• C4 Support for local employment: the firm’s share of local PMETs relative to its subsector peers

Bonus points are available under C5 (Skills Bonus, for roles on the Shortage Occupation List) and C6 (Strategic Economic Priorities, for firms in qualifying programmes).

The C1 benchmarks are refreshed every year

MOM updates the C1 salary benchmarks annually using the latest local wage data. A salary that earned 10 points against the 65th percentile benchmark at the original application may earn 0 points at renewal if local wages in that sector have risen faster than the employee’s pay. Because C1 is also age-graded, the same ageing effect described above applies here too.

Firm-level scores can drift

C3 and C4 are scored on your company’s workforce, not the individual. If you have hired several professionals of the same nationality since the original application, or your local PMET headcount has fallen, the renewal score can drop even though nothing about the employee has changed.

Fixed salary means fixed salary

MOM looks at fixed monthly salary. Discretionary bonuses, commissions, variable allowances and equity are not counted. A total package of SGD 9,000 made up of SGD 6,500 basic and SGD 2,500 in commission is assessed at SGD 6,500.

Step-by-step process

• Diary renewals early. Renewals can be submitted on MOM’s EP Online up to six months before expiry. Start your internal review at least nine months out so there is time to act on what you find.
• Confirm the employee’s age at the expected assessment date. Check which age band they will fall into and the qualifying salary that applies, including whether the 2028 renewal floor will apply.
• Run the COMPASS Self-Assessment Tool. Use MOM’s tool with the current benchmarks, the employee’s actual fixed salary, and your current workforce data. Do not rely on the score from the original application.
• Review the job description. Make sure the job title, duties and SSOC occupation still reflect the role. A promotion or change in responsibilities should be reflected accurately.
• Decide on any salary adjustment. If the employee is close to a threshold, an adjustment to fixed salary, timed into the payroll cycle before submission, is usually cleaner than a late scramble. Restructuring pay purely to clear the threshold, without a genuine change to what is actually paid, should be avoided.
• Check supporting records. Confirm that payroll, the IRAS Form IR8A filings and the salary declared to MOM are consistent.
• Submit and monitor. Track the application in EP Online and respond promptly to any request for information.

Common mistakes to avoid

• Anchoring to the headline floor. SGD 5,600 is the minimum for younger candidates only. Most renewal failures linked to salary involve older employees whose age-graded requirement is much higher.
• Counting variable pay. Commission-heavy or bonus-heavy packages can look generous but score poorly on fixed salary.
• Ignoring nationality concentration. Several hires from the same country in a small team can reduce C3 points across every pass in the firm.
• Leaving it too late. If a renewal is rejected close to expiry, there may be no time to appeal or adjust, and the employee may need a Short-Term Visit Pass to wind up their affairs.
• Inconsistent records. A salary declared to MOM that does not match payroll or IRAS records raises questions under the Employment of Foreign Manpower Act, which can lead to penalties and work pass debarment.

Practical examples

Example 1: The ageing effect

A logistics firm hired an operations manager at age 33 on SGD 6,800 a month, comfortably above the requirement for that age. Three years later, at 36, the salary is SGD 7,300. At renewal the age-graded qualifying salary for that band has risen, and the updated C1 benchmark for the sector places the salary below the 65th percentile. The C1 score falls from 10 to 0 and the total COMPASS score drops below 40. An increase to fixed salary, made three months before submission, restores the C1 points and the renewal is approved.

Example 2: The firm-level shift

A 25-person technology company had two EP holders of one nationality when it first applied. It has since hired four more from the same country. At renewal, the C3 score for all of them falls. The employer’s options are to strengthen other criteria, such as building up local PMET hiring to improve C4, or to check whether the role qualifies for the C5 Skills Bonus.

How Singapore Employment Agency can help

Singapore Employment Agency helps employers plan EP renewals well ahead of expiry. We can review your EP holders against the current qualifying salary and COMPASS benchmarks, flag passes at risk, advise on how firm-level changes affect your scores, and prepare and submit renewals through MOM’s EP Online. Where a renewal has been rejected, we can assist with the appeal. We also support S Pass, Work Permit and Dependant’s Pass matters and HR compliance under the Employment Act.

Frequently Asked Questions

Is an EP renewal assessed differently from a new application?

The same core tests apply: the qualifying salary for the employee’s age and sector, and COMPASS unless an exemption applies. The main difference is that benchmarks and your firm’s profile will have moved since the original application.

How early can I renew an Employment Pass?

Renewals can be submitted up to six months before the pass expires. Starting the internal review earlier gives you time to make any salary or structural changes.

Do bonuses count towards the qualifying salary?

No. MOM assesses fixed monthly salary. Variable bonuses, commissions and equity are excluded.

What happens if the renewal is rejected?

Employers can appeal, generally within three months of the outcome, and should address the specific reasons for rejection. If the pass expires in the meantime, the employee may need a Short-Term Visit Pass while the matter is resolved.

Requirements may change, so always check the latest guidance from MOM, IRAS or ACRA, or consult a professional adviser.

Key takeaways

• Meeting the SGD 5,600 headline floor isn’t enough for most EP renewals, as the qualifying salary rises with age and age is measured at renewal.
• COMPASS applies to renewals, and the C1 salary benchmarks are updated every year.
• Your firm’s diversity and local employment scores are reassessed at each renewal.
• Only fixed monthly salary counts; variable pay is excluded.
• The floor rises to SGD 6,000 (SGD 6,600 in financial services) for renewals from 1 January 2028, so plan salary reviews now.
• Start renewal reviews about nine months before expiry and use MOM’s COMPASS Self-Assessment Tool with current data.

If you would like to find out more about how Singapore Employment Agency can assist with your work pass and employment compliance requirements, please get in touch with the team at [email protected].

Yours sincerely,
The editorial team at Singapore Employment Agency

Disclaimer: This does not constitute legal advice. If you require legal advice, please contact a lawyer.