EP Regulations in Singapore are Changing due to COVID-19

The COVID-19 pandemic has changed the world of business as we know it, and companies across the world are stuck in a state of recovery. While some industries have seen positive growth thanks to the pandemic, many more are either struggling to meet pre-pandemic profitability levels or are finding their recovery comes in fits and starts.

Singapore is no stranger to these economic hardships, and as the economy is recovering unevenly, the Ministry of Manpower (MOM) has announced a series of changes to Employment Passes (EPs) and S Passes for foreign workers.

Summary of EP Regulations Changes

Announced on the 27th August 2020, the following changes are due to come into effect throughout the end of the year and in 2021:

1st September 2020:

• The minimum monthly salary of new EP applicants rises to S$4,500. More experienced candidates will have a higher minimum monthly salary.

1st October 2020:

• The minimum monthly salary of new S Pass applicants rises to S$2,500. More experienced candidates will have a higher minimum monthly salary.
• The Fair Consideration Framework (FCF) will change as follows:
  • The minimum duration that a job can be advertised on MyCareersFuture.sg for work pass applicants is extended to 28 days,
  • The job advertising requirements extend to S Pass applicants.

1st December 2020:

• The minimum monthly salary for new EP applicants in the Financial Services Sector rises to S$5,000. More experienced candidates will have a higher minimum monthly salary.

1st May 2021:

• The new monthly salary requirements detailed above take effect for EP renewal applicants.

Due to COVID-19, MOM also announced that they would be limiting approvals for new work pass applications in Singapore, and they also urge that any new work pass applicants looking to immigrate to Singapore have their entry deferred where possible. Even when they approve a work pass application, foreign employees (and their families, if applicable) must be approved for entry by the MOM before they travel.

In addition, before approving any new work pass applications, the MOM has stated that it will be taking into account each company’s record with hiring and supporting workers from Singapore. This means that employers looking to hire foreign workers need to have supported Singaporean PMETs (professionals, managers, executives, and technicians) throughout their employment. They also have to show that they’ve been responsive to government initiatives to hire local talent and train PMETs from Singapore before hiring employees from overseas.

Why are EP Regulations Changing?

It’s undeniable that one of the primary reasons behind work pass regulations changing in Singapore is the COVID-19 pandemic.

Every country around the world wants to limit transmission of the virus, so it makes sense that the MOM is planning to heavily limit the amount of work pass applicants it accepts and restrict entry into Singapore. With some countries affected more than others, this ensures that the risk of transmission from foreign travellers is controlled as much as possible.

However, that’s not the only reason why EP regulations are changing. As mentioned earlier, the economy in Singapore is struggling due to the pandemic, and industries are recovering at a wildly varying rate. The unemployment rate in Singapore is currently 3.4%, which is the highest it’s been since 2004. With that in mind, the MOM’s new work pass regulations are intended to push employers to hire from local talent before they consider employees from overseas.

How New EP Regulations are Making it Harder to Hire SAP Professionals

Unfortunately for many employers in Singapore, hiring local SAP professionals was already difficult.

While that’s not to say that employers can’t find talented Singaporean SAP professionals, SAP is already a niche profession. It’s generally only taught after graduation level, meaning that IT and development professionals looking to expand into this career often find themselves paying for expensive courses to learn SAP.

IT and development professionals already living in Singapore have access to multiple SAP training centres, however, with the unemployment rate at a significant high, employers can’t expect that local professionals will have the funds to train into this career.

However, before these new restrictions and the COVID-19 pandemic, it was somewhat easier to hire SAP professionals because a greater amount of foreign talent was already available in the country. While there will undoubtedly be SAP professionals living in Singapore on pre-existing work passes, it’s going to be more difficult to bring in outside talent.

As we talked about earlier, employers in Singapore legally have to advertise jobs equally to local talent as well as foreign workers, and with the new restrictions, employers must be seen to hire and train local talent wherever possible.

However, this makes it trickier for employers to hire in-house SAP professionals in Singapore, particularly if there’s a skills gap that the local workforce can’t fill. So how can employers in Singapore get around this?

Hiring Remote SAP Professionals

Thankfully, there is a solution for employers who are struggling to hire local SAP professionals and obtain work passes for foreign talent in Singapore. While this may not be an ideal solution for some businesses, hiring a remote SAP professional is the best way to guarantee that employers can continue to access top SAP talent while restrictions are tight.

Hiring a remote SAP professional also provides employers with more flexibility over hiring options. Companies who are still struggling may find that hiring a freelance SAP professional offers the most financial flexibility, while others with a more stable budget can consider hiring an “in-house” remote SAP professional.

Hiring an “In-House” Remote SAP Professional

Whether employers are looking for an SAP consultant or developer, both of these specialisations lend themselves to remote working. With a myriad of video conferencing and project management tools to choose from, it’s never been easier for employers to hire, train, and work with a remote team.

The main benefit of this is that employers don’t have to worry about obtaining work passes for these employees to work in Singapore. Given that EP regulations have been tightened due to the effect of COVID-19 on the nation’s health and economy, hiring a remote employee is a great solution for employers who still need to hire a full or part-time SAP professional.

Hiring a Remote Freelance SAP Professional

The other option that employers have is to contract a remote freelance SAP professional. Once again, this gives employers the benefit that they don’t have to worry about work pass regulations. However, freelance professionals come with a lot more flexibility than contracted employees.

Hiring remote employees who live overseas always comes with the issue of finding someone who works in the same, or similar, time zone as their employer. Freelance SAP professionals can set their own schedules, so while they’re not bound to work to the Singaporean clock, some might already work those same hours.

This additional flexibility does come at a cost. Because freelancer SAP professions are self-employed, they typically charge higher rates than contracted employees because they have to take care of their own tax, administrative work, sick pay, and more. However, because employers can work with freelance SAP professionals to work to a set number of hours each week or month, it’s just as easy to budget for freelance talent as it is for contracted employees.

All of this makes hiring a freelance SAP professional a good choice for businesses that can’t afford to hire a contracted employee, but still need the support of a talented SAP consultant or developer.