Skip to main content
InsightSpotlight

Malaysia Revises Employment Pass Salary Requirements from 1 June 2026

January 12, 2026January 23rd, 20265 min read

Malaysia Revises Employment Pass (EP) Salary Requirements Effective 1 June 2026: What Employers Need to Know

Update (January 2026):
Following the publication of this article, the Ministry of Home Affairs confirmed additional details under Malaysia’s new expatriate employment policy, effective 1 June 2026.

In addition to revised minimum salary requirements, fixed validity periods will be introduced for Employment Pass (EP) approvals:

  • EP Category I: Validity fixed at 10 years
  • EP Category II: Validity fixed at 10 years, subject to a local workforce succession plan
  • EP Category III: Validity fixed at 5 years, subject to a local workforce succession plan

Previously, Employment Passes did not have a fixed maximum duration. The introduction of defined validity periods is intended to guide employers in long-term workforce planning and the progressive transition of roles to local talent, alongside the updated salary thresholds.

Malaysia has announced significant revisions to the minimum salary requirements for Employment Pass (EP) Categories I, II, and III, affecting companies that employ foreign professionals and foreign knowledge workers.

The update was issued by the Expats Service Centre under the Malaysia Digital Economy Corporation (MDEC) following revisions by the Ministry of Home Affairs (Kementerian Dalam Negeri, KDN). The new salary thresholds will take effect from 1 June 2026 and apply to all new and renewal Employment Pass applications submitted from that date onward.

This change will directly impact workforce planning, compensation structures, and renewal strategies for employers across multiple sectors.

What Has Changed?

The minimum salary requirements for each Employment Pass category have been revised as follows:

Employment Pass Category Current Minimum Salary Revised Minimum Salary (Effective 1 June 2026)
Category I RM10,000 and above RM20,000 and above
Category II RM5,000 – RM9,999 RM10,000 – RM19,999
Category III RM3,000 – RM4,999 RM5,000 – RM9,999

These increases represent a substantial adjustment across all categories, particularly for Category I and Category II roles.

When Do the New Requirements Apply?

The revised salary thresholds apply to:

  • All new Employment Pass applications submitted from 1 June 2026, and
  • All renewal applications submitted from 1 June 2026 onward

This means that existing EP holders will also need to meet the new salary requirements when their passes are due for renewal.

Who Is Affected by This Change?

This revision primarily affects employers hiring or retaining:

  • Foreign professionals and executives
  • Foreign knowledge workers (FKWs)
  • Technical specialists and senior managers

Industries that rely on expatriate talent — including technology, manufacturing, professional services, digital economy, and services sectors — should review how these new thresholds align with their current remuneration structures.

Why This Matters for Employers

1. Workforce Cost and Budget Planning
The higher salary thresholds will directly impact employment budgets, especially for roles previously aligned with EP Categories II and III. Employers may need to reassess compensation frameworks for affected positions.

2. Renewal Eligibility Risks
Existing EP holders whose salaries fall below the revised thresholds may face renewal challenges unless their remuneration is adjusted before application submission.

3. Role Scope and Classification
Employers may need to review whether certain positions:

  • Accurately reflect the seniority expected under each EP category
  • Require expanded responsibilities or reclassification
  • Should be restructured under alternative staffing strategies

4. Operational Continuity
Non-compliant applications risk delays or rejections, which could disrupt project timelines, onboarding schedules, and business continuity.

What Employers Should Do Now

To prepare for the revised Employment Pass framework effective 1 June 2026, employers should consider the following steps:

Review Current EP Holders
Identify employees whose salaries fall below the new thresholds and note upcoming renewal timelines.

Reassess Compensation Structures
Evaluate whether salary adjustments are feasible and sustainable in line with the revised category requirements.

Align Contracts and Documentation
Ensure employment contracts, salary records, and job descriptions accurately reflect updated remuneration levels and role scope.

Plan Workforce Strategy for 2026 and Beyond
Forecast expatriate workforce needs, identify critical roles that require EP sponsorship, and explore alternative staffing models where appropriate.

Early preparation will help reduce last-minute complications and support smoother application and renewal processes.

How This Fits Into Malaysia’s Broader Talent Strategy

The revised salary thresholds reflect Malaysia’s continued focus on attracting high-value foreign talent, encouraging skills transfer, and aligning expatriate employment with national workforce development objectives.

For employers, this underscores the importance of structured workforce planning, compliance-driven HR governance, and responsible recruitment practices.

Conclusion

The increase in Employment Pass minimum salary requirements effective 1 June 2026 marks a significant shift in Malaysia’s expatriate employment framework.

Organisations that rely on foreign professionals should begin reviewing their workforce structures, compensation policies, and renewal timelines now to ensure continued compliance and operational stability in the years ahead.

Advisory Note

If you would like clarity on how the revised Employment Pass salary thresholds affect your current workforce or upcoming renewals, Osadi can help you review eligibility, align compensation, and plan your workforce strategy with confidence. Contact us now.