The Local Qualifying Salary (LQS) determines the number of local employees who can be used to calculate a company’s S Pass and Work Permit quota entitlement. It is the minimum salary that is to be paid to a staff to qualify as full-time employment. Currently, the LQS is SGD$1,400. This means that a company will have to pay a staff at least SGD$1,400 for that staff to qualify as 1 headcount when calculating the company’s S Pass and Work Permit quota entitlement. If the staff is paid less than SGD1,400 but at least SGD$700, that individual is counted as half a headcount.
A Singaporean or Permanent Resident employee under a contract of service is counted as:
- 1 local employee if they earn the LQS of at least $1,400 per month.
- 0.5 local employee if they earn half the LQS of at least $700 to below $1,400 per month.
The LQS is to ensure that workers are meaningfully employed rather than companies paying workers a token sum to add to their headcount for the purpose of increasing their S Pass and Work Permit quota entitlement.
For example, the current S Pass sub- Dependency Ratio Ceiling (DRC) is 10%. If a company has 9 Singaporean or Singapore Permanent Resident employees earning at least SGD$1,400 a month, they can hire 1 S Pass employee.
If your company requires assistance with employment matters, you can visit: https://singaporeemploymentagency.com/
When in doubt, seek legal advice or consult an experienced ACRA Filing Agent.
The editorial team at Singapore Secretary Services
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