Early results of EP revamp show firms depending less on foreigners

Early results from a points-based system to evaluate Employment Pass (EP) applications rolled out in September 2023 suggest it has made employers more selective in hiring foreign talent, said Minister for Manpower Tan See Leng on March 6.

- Tay Hong Yi

Since the Complementarity Assessment Framework, or Compass, was introduced, the share of firms with higher dependence on foreigners of a single nationality has decreased by 7 per cent, Dr Tan told Parliament during the debate on the Ministry of Manpower's (MOM) budget.

He was responding to questions from labour MP Patrick Tay (Pioneer) on how the Republic's EP framework incentivizes businesses to develop a strong local core.

The share of firms with higher dependence on foreigners generally has decreased by 15 per cent, Dr Tan added.

Across both categories, the firms also created 4,000 more professional, managerial, executive and technical jobs for locals, he noted.

"Firms more dependent on foreigners of a single nationality, or foreigners in general, will have to diversify their workforce or hire more locals to pass Compass," Dr Tan said. He also noted that about 30 per cent of current EP holders have been issued passes under Compass.

Compass is a points-based framework that evaluates attributes of individual EP applicants and their prospective employer in deciding to issue the pass.

All new EP applications made since Sept 1, 2023, and renewals since Sept 1, 2024, have been evaluated through Compass.

Under Compass, four "foundational" criteria are used to assess an application. They are an individual's salary and qualifications, as well as the firm's workforce diversity and support for local employment.

The EP is valid for up to two years for first-time pass holders, and up to three years for those whose passes are renewed.

"Our work pass framework is carefully managed to provide access to high-quality foreigners who support productive sectors and create good jobs for locals," Dr Tan said.