Updates on Requirements & Processes at MDEC

 With the recent process improvements introduced by MDEC on 15 Nov 2017, there has been some updates on requirements when applying for Employment Passes for Foreign Knowledge Workers (FKWs)

SALARY COMPONENTS

• MDEC recognizes the various components of remuneration packages received by FKWs and has made a change to the definition of minimum salary to this effect.
• Currently, the salary component only allows for the basic payto be taken into account when deriving the minimum salary requirement.
• Effective immediately, this requirement has been relaxed somewhat to allow the inclusion of fixed allowanceswhen calculating the total minimum salary.
• The fixed allowances must be paid on a monthly basis, in cash, stated in the Employment Contract, included in payslips and have the relevant monthly tax deducted.
• For example, for an Employment Pass (EP) Category III, the minimum salary required is RM3,000. FKWs who earn a RM2,500 basic salary and RM500 in fixed allowances still could not apply for the EP as the salary was defined only at RM2,500.

Impact – with this favorable change of now permitting fixed allowances to be calculated in deriving the total salary, more FKWs will be able to meet the respective minimum salary requirements in order to get their EPs and/or qualify to apply for their accompanying dependants.

A quick look at the prevailing minimum salary requirements below –

PASSPORT VALIDITY

• Currently, the validity of the applicant’s passport musts be at least 13 months when submitting the EP application.
• Effective immediately, the requirement is for the applicant’s passport to be valid for at least 14 months when submitting the EP application.

We will continue to look out for further updates or any changes to the current processes and/or requirements. Stay tuned!

In the meantime, feel free to reach out to your friendly neighborhood partner, The Corporate Lab at [email protected] or call +6012-215 7424 even if to just say Hi!