Employment Pass Minimum Salary Malaysia: 2026 Revised Requirements Explained
The Employment Pass in Malaysia has undergone its most significant salary revision in nearly a decade.
Effective 1 June 2026, the Ministry of Home Affairs raised the minimum salary thresholds across all three EP categories.
For many companies, this means existing workforce plans — and pending renewal applications — need to be reviewed immediately.
This guide explains what changed, why, how the new thresholds apply to each EP category, and what employers should do to prepare.
It also covers how employer of record services can help companies adapt their hiring structures without disrupting operations.
What Are the New Employment Pass Minimum Salary Requirements in Malaysia?
The revised salary thresholds apply to all new Employment Pass applications and all renewal applications submitted from 1 June 2026 onwards.
The revision was officially announced by the Ministry of Home Affairs (MOHA) on 14 January 2026, following Cabinet approval on 17 October 2025.
The policy has been in development since 2022, shaped by consultations with industry players and aligned with the Thirteenth Malaysia Plan (RMK-13).
The table below compares the previous and revised salary requirements for each Employment Pass category:
| EP Category | Previous Minimum Salary | Revised Minimum (From 1 June 2026) | Max Duration |
|---|---|---|---|
| Category I | RM 10,000 and above | RM 20,000 and above | Up to 10 years |
| Category II | RM 5,000 – RM 9,999 | RM 10,000 – RM 19,999 | Up to 10 years (succession plan required |
| Category III | RM 3,000 – RM 4,999 | RM 5,000 – RM 9,999 | Up to 5 years (succession plan required) |
Source: Expatriate Services Division (ESD), Immigration Department of Malaysia — Announcement dated 15 January 2026.
Why Did Malaysia Revise the EP Salary Requirements?
The previous thresholds were set in December 2016 and had not been updated for nearly a decade.
According to the official ESD announcement, the revised policy aligns with the goals of Malaysia’s Thirteenth Malaysia Plan (RMK-13).
The primary objective is to reduce reliance on foreign labour and to prioritise the employment of suitably qualified local talent.
By raising the salary floor, the Government aims to ensure that Employment Passes are issued only for roles that cannot be filled locally — and that they command commensurate compensation.
The revision also supports Malaysia MADANI’s inclusive economic agenda, ensuring that policy changes are implemented in a gradual and balanced manner.
For foreign investors considering a Malaysian presence, our guide on setting up a company in Malaysia covers the full entity setup process.
Why Did Malaysia Revise the EP Salary Requirements?
Employment Pass Category I — RM 20,000 and Above
Category I is now reserved for the most senior roles in an organisation — CEOs, directors, regional heads, and highly specialised technical leads.
The minimum salary has doubled from RM 10,000 to RM 20,000 per month.
Holders under Category I can be issued a pass for up to 10 years and are generally permitted to bring dependants.
No succession planning requirement applies at this tier, reflecting the strategic nature of these appointments.
Employment Pass Category II — RM 10,000 to RM 19,999
Category II now covers managers, senior professionals, engineers, and other mid-to-senior level specialists earning between RM 10,000 and RM 19,999 per month.
The previous Category II range (RM 5,000–RM 9,999) has effectively become the new Category III floor.
Passes can be issued for up to 10 years, but a formal succession plan is required, demonstrating how the role will eventually be transitioned to a local employee.
Dependants are generally allowed under this category.
Companies hiring under Category II for the first time may benefit from our migration advisory services to ensure a compliant application.
Employment Pass Category III — RM 5,000 to RM 9,999
Category III covers skilled and technical specialists in the RM 5,000–RM 9,999 salary band.
This is a significant increase from the previous minimum of RM 3,000 — a threshold that effectively disqualifies many mid-range technical roles that previously qualified under the old Category III.
Pass duration is capped at 5 years, and a succession plan is required for both new applications and renewals.
Dependant eligibility under Category III is subject to individual approval and is not automatic.
The Succession Planning Requirement for Categories II and III
Categories II and III both require employers to submit a succession plan as part of the EP application.
A succession plan demonstrates how the foreign hire will transfer skills and knowledge to local employees over the course of the pass duration.
It typically includes a timeline, identified local successors or trainees, and the competencies to be developed.
MOHA has indicated that succession plans will be reviewed as part of the renewal process — a weak or absent plan may result in renewal refusal.
Employers should treat succession planning as an ongoing HR commitment, not a one-time administrative formality.
Impact on EP Renewals: What Employers Need to Know
The revised salary thresholds apply to renewal applications submitted on or after 1 June 2026.
This means employees whose salaries fall below the new thresholds for their category will not be eligible for renewal under that category.
Employers have two options: increase the employee’s salary to meet the revised threshold, or reassess whether the role meets the criteria for an alternative category.
MOHA has advised companies to plan ahead and align their workforce strategies well before renewal deadlines approach.
Companies with large EP headcounts are strongly encouraged to audit their current workforce against the new thresholds as a matter of priority.
If you need to review your corporate and hiring structure, visit our services page for a full overview of how Shinewing TY Teoh can assist.
The Local Hiring Obligation and MYFutureJobs
In addition to the salary revision, employers must also comply with Malaysia’s local hiring obligation before submitting an EP application.
For roles with a monthly salary below RM 15,000, the employer must advertise the vacancy on MYFutureJobs — the Ministry of Human Resources online portal.
The advertisement must remain live for a minimum of 30 days before the EP application can proceed.
Roles offering RM 15,000 and above, C-suite positions, and certain corporate transfer roles are exempt from this requirement.
Meeting the MYFutureJobs obligation is a prerequisite, not an optional step. Failure to comply can result in application rejection.
Foreign companies entering Malaysia for the first time should also review our guide on registering your company in Malaysia before initiating any EP applications.
How Employer of Record Services Help Navigate the 2026 EP Changes
The 2026 salary revision has increased the complexity of hiring foreign professionals in Malaysia — particularly for companies still building out their local entity or HR infrastructure.
Employer of record (EOR) services allow a foreign company to deploy talent in Malaysia through a locally registered legal employer, without having to set up their own entity first.
An EOR provider handles Expatriate Post approval, EP applications, MYFutureJobs compliance, and succession planning documentation on behalf of the client.
This is especially valuable during a period of policy transition, where getting the category, salary structure, and succession plan right from the outset matters more than ever.
Compare the two approaches in our guide: employer of record vs entity setup in Malaysia.
Also see our comparison of EOR vs BPO in Malaysia to understand the differences between outsourcing models.
For companies evaluating market entry, our guide on how to start a company in Malaysia as a foreigner is a useful starting point.
Frequently Asked Questions
Q: When do the new EP minimum salary requirements take effect in Malaysia?
The revised thresholds are effective from 1 June 2026. All new and renewal Employment Pass applications submitted on or after that date must comply with the new salary floors.
Q: What happens to existing Employment Pass holders who earn below the new thresholds?
Existing passes remain valid until their expiry date. However, renewal applications submitted from 1 June 2026 onward must meet the revised salary thresholds. Employers should plan salary adjustments well in advance of renewal dates.
Q: Does the salary revision affect all EP categories equally?
All three categories have seen significant increases. Category I doubled from RM 10,000 to RM 20,000. Category II rose from RM 5,000–9,999 to RM 10,000–19,999. Category III moved from RM 3,000–4,999 to RM 5,000–9,999.
Q: Is succession planning mandatory for all Employment Pass applications?
Succession planning is required for Category II and Category III applications. Category I (RM 20,000+) is exempt. A credible succession plan must be submitted and will be reviewed at renewal.
Q: Can a company use an EOR to sponsor an Employment Pass if they do not yet have a Malaysian entity?
Yes. An employer of record provider, being a locally registered company, can act as the legal employer and sponsor EP applications on behalf of a foreign client. This is a common market-entry strategy for companies testing the Malaysian market before incorporating locally.
Conclusion
Malaysia’s 2026 Employment Pass salary revision represents the most substantial update to the expatriate work pass framework in nearly a decade.
All three categories have seen significant threshold increases, and Categories II and III now carry formal succession planning obligations.
For employers, the immediate priority is auditing current EP holders and planned hires against the new thresholds before 1 June 2026 applies to renewals.
For companies without a Malaysian entity, employer of record services offer a compliant and agile path to deploying foreign talent under the revised framework.
Contact Shinewing TY Teoh for expert guidance on EP applications, salary structuring, and corporate setup in Malaysia.
