The Ministry of Home Affairs has announced revisions to Malaysia’s Expatriate Employment Policy, introducing higher minimum salary thresholds and replacement planningrequirements for certain Employment Pass (“EP”) categories.
The revised policy applies to all new and renewal EP applications submitted on or after 1 June 2026.
What’s changing?
|
EP Category |
Minimum monthly salary |
Employment contract tenure |
Dependent pass |
|||
|
Current |
Revised |
Current |
Revised |
Current |
Revised |
|
|
I |
RM10,000 and above |
RM20,000 and above |
Up to 5 years (renewable) |
Up to 10 years |
Allowed |
Allowed |
|
II |
RM5,000 to RM9,999 |
RM10,000 to RM19,999 |
Up to 2 years (renewable) |
Up to 10 years with replacement plan |
Allowed |
Allowed |
|
III |
RM3,000 to RM4,999 |
RM5,000 to RM9,999 |
Up to 1 year (maximum 2 times renewal) |
Up to 5 years with replacement plan |
Disallowed |
Allowed |
Employers engaging expatriates are now required to implement a replacement plan under EP categories II and III aimed at preparing local employees to take over expatriate roles within the approved employment period.
The plan is expected to include:
- Identification of roles and functions to be transferred to local employees.
- Training, mentoring, and knowledge transfer from expatriates to local employees.
- A reasonable timeframe to ensure local employees are ready in terms of skills and competencies.
- Operational continuity planning to ensure that the transition does not affect productivity or organisational performance.
