Moving to Malaysia? Government Confirms New Higher Minimum Salary Rules for Expats Starting June 1

Considering moving to the center of Southeast Asia? Things are going to change, and you will have to watch closely because it may have a direct impact on your relocation plans. The Malaysian government has officially announced a wide-ranging change in the country’s expatriate employment policies.

In response to the Ministry of Home Affairs, Malaysia is making a structural shift in its qualification of foreign professionals’ financial qualifications. New or renewed work visa applicants will have to secure much higher income requirements from June 1, 2026. The change in policies is the largest in 10 years in the country.

The Big Shift: Restructuring the Employment Pass (EP) Tiers

The updated directives apply across all primary registration tracks, including the Expatriate Services Division (ESD) and the Malaysia Digital Economy Corporation (MDEC). If your application or renewal is submitted on or after the June deadline, your compensation package must align with the new criteria.

The previous baseline system, which remained untouched since 2016, is effectively doubling for the highest-tier professionals.

Breaking Down the New Higher Minimum Salary Rules for Expats

The visa structure is divided into three distinct layers. Understanding where your prospective job offer or current contract falls is essential to avoid sudden visa rejections.

Category I: Executive and Top-Tier Corporate Leaders

The call for senior directors, C-level executives, and top-level experts has become much higher. The minimum baseline for monthly contributions rises from RM 10,000 to a huge RM 20,000. The good news is that the government will provide successful applicants (Category I) a guaranteed tenure of up to 10 years, which is excellent for long-term stability.

Category II: Managers and Mid-Level Professionals

The minimum salary for professionals will rise to RM 10,000 from RM 5,000 for those who are in middle management or specialised technical positions. This visa category will also include visas with a 10-year validity. But corporations are now required to present a concrete plan for training the locals to eventually fill these positions in the future, with a clear succession plan. 

Category III: Junior Staff and Technical Workers

The lowest tier, typically reserved for junior engineers and specialized technicians, will see the entry-level salary threshold jump from RM 3,000 to RM 5,000.

Sector Exception Note: If you are employed within the specialized manufacturing or manufacturing-related services sectors, the minimum threshold is set even higher at RM 7,000 per month. This tier is capped at a strict maximum duration of 5 years.

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Why Is the Government Changing the Rules Now?

The Cabinet agreed to this move in efforts to change the labour market dynamics in the country, according to a press statement received via the Malaysian Investment Development Authority (MIDA). The main objective is to push multinational companies to hire local staff for temporary and/or permanent positions.

The government’s objective is to lower the need for businesses to hire low- and mid-level foreign talent and to make certain that only the highest caliber foreign talent enters the local workforce. 

Impact on Families and Dependents

Fortunately, the basic rules about family accompaniment stay the same. Foreign nationals with Category I and Category II passes are fully entitled to sponsor dependent passes for their spouses, children, and parents according to the general policy of the Malaysian Immigration Department.

It is a myth that only those in Category III can be allowed dependents; the baseline requirements have been adjusted to include people in Category III, and the necessary corporate transition support is still being obtained from employers. 

FAQs

What happens if my current Employment Pass expires after June 1?

If the visa you have now is due for renewal after the deadline, you don’t have to worry right away. Any pass issued will be in effect until it is printed on its expiration date. As soon as your company registers for renewal, however, your contract will need to be changed to comply with the new minimum salary standards for expats.

Are there any industries exempt from these new rules?

No industry can be spared. Rules are in effect for all sectors. In Category III, however, it is the manufacturing sector with even higher requirements that raises the entry price from the normal RM 5,000 to RM 7,000.

What is a corporate succession plan?

A corporate succession plan is a type of document that needs to be prepared for Category II and III visas. It requires companies to detail the clear training processes, timelines, and mentoring plans for local Malaysian workers, demonstrating how they will be trained to eventually replace the foreign workers.

Manika

Manika has a curious mind with a knack for turning information into engaging content. She writes to inform, simplify, and add value to every reader’s journey.

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