If you plan to move expatriate staff to Malaysia — or renew the passes of people already there — the rules change materially on 1 June 2026. The Expatriate Services Division (ESD) has raised Employment Pass salary thresholds and added new conditions that affect every foreign employer. Here is what is changing and how to prepare.
The new salary thresholds
Following Cabinet approval, all new and renewal Employment Pass (EP) applications submitted on or after 1 June 2026 must meet revised minimum monthly salaries:
| Category | Minimum monthly salary (from 1 June 2026) |
|---|---|
| EP Category I | RM20,000 (doubled from RM10,000) |
| EP Category II | RM10,000 – RM19,999 |
| EP Category III | RM5,000 – RM9,999 |
Four new conditions employers must meet
- Section 60K pre-approval from JTKSM. Before an EP can even be submitted, companies must obtain prior approval from the Department of Labour (JTKSM) under Section 60K of the Employment Act. This is now a mandatory prerequisite — build the extra lead time into your hiring plan.
- Succession plans for EP II and EP III. A structured plan to transition the role to a Malaysian employee over time is now a formal requirement.
- 10-year cumulative tenure cap for Category I. Category I holders are now subject to a maximum cumulative tenure of 10 years.
- Dependent eligibility for EP III. EP III holders whose applications are submitted on or after 1 June 2026 may bring dependents; those issued before remain under the old restrictions.
Why the policy is tightening
The revised policy aligns with the Thirteenth Malaysia Plan (RMK-13) objective of reducing reliance on foreign labour and prioritising qualified local talent. In practice, that means ESD wants to see genuine, senior, well-paid roles — and evidence that you are building local capability behind every expatriate.
What foreign employers should do now
- Audit your current EP holders against the new thresholds before their next renewal date.
- Re-band roles and budgets — a position you previously hired at RM12,000 to qualify for Category I now needs RM20,000, or drops to Category II.
- Prepare a succession plan template for EP II/III roles so applications are not held up.
- Sequence the approvals correctly — Section 60K first, then the EP. Doing it in the wrong order wastes weeks.
ONEKEY BIZ manages ESD registration, Section 60K approval, Employment Pass applications and renewals end to end for foreign companies. Book a free consultation and we will review your team against the 2026 rules. You can also explore our visa solutions.
Frequently asked questions
What is the new Employment Pass salary threshold from June 2026?
From 1 June 2026: Category I requires RM20,000/month (up from RM10,000), Category II RM10,000–19,999, and Category III RM5,000–9,999. The thresholds apply to both new applications and renewals.
What is the Section 60K approval?
Before an Employment Pass can be submitted, companies must obtain prior approval from the Department of Labour (JTKSM) under Section 60K. It is now a mandatory pre-step, so build extra lead time into hiring.
Do the new rules affect renewals of existing passes?
Yes. Renewals submitted on or after 1 June 2026 must meet the new thresholds. A holder previously on RM10,000–19,999 as Category I will move to Category II on renewal, with different conditions including a succession plan.
Sources & references
This article is general information only, not legal, tax or immigration advice. Policies, thresholds and official fees are set by the relevant Malaysian authorities and may change. Talk to our consultants about your specific situation.