- 25 Feb 2020 11:51
#15069750
Glass Ceiling Salary level for Singaporean PMET workers may be as low as S$1720/month ($2,208.33/monthly if company is honest).
From this point onwards, there is zero financial incentive to hire Singaporean from a corporate balance sheet perspective. This glass ceiling threshold point, whereby any citizenship benifit of being Singaporean vanishes for the Singaporean employee.
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Calculation:
E-pass minimum salary is $3600 to qualify and levy payable is zero (FOC). https://www.mom.gov.sg/passes-and-permits
Based in salary costs to company payroll, the Singaporean salary must be $3600/1.2= $3000 considering that company has to pay 20% CPF for the Singaporean/PR worker.
If S-pass workers are included in the calculation, the salary ceiling is even lower because S-pass salary level is at $2400 and the levy is as low as $250 (onwards) meaning payroll costs of just $2650 and thus equivalent citizen salary of $2,208.33/monthly (if company is honest and doesn't operate a slush fund). If the foreigner is agreeable to give say $500 monthly kickback to company (accept $1900/ mth salary), then that is additional $585 payroll discount (need to add corporate income tax labour costs deduction), so payroll costs will be $2065 and thus citizen salary ceiling will be just $1720.83/mth.
Kickbacks: https://www.straitstimes.com/singapore/ ... -kickbacks
At this point of salary ceiling/ higher $2,208.33/monthly (honest employer) , it is financially wise to retrench the Singaporean employee and hire a foreign employee instead.
S-pass levy rates:
source: https://www.singaporebudget.gov.sg/docs ... nnexc3.pdf
Reference:
For updates and discussion on this topic, please refer to https://forums.hardwarezone.com.sg/eat- ... 09788.html
From this point onwards, there is zero financial incentive to hire Singaporean from a corporate balance sheet perspective. This glass ceiling threshold point, whereby any citizenship benifit of being Singaporean vanishes for the Singaporean employee.
------------------
Calculation:
E-pass minimum salary is $3600 to qualify and levy payable is zero (FOC). https://www.mom.gov.sg/passes-and-permits
Based in salary costs to company payroll, the Singaporean salary must be $3600/1.2= $3000 considering that company has to pay 20% CPF for the Singaporean/PR worker.
If S-pass workers are included in the calculation, the salary ceiling is even lower because S-pass salary level is at $2400 and the levy is as low as $250 (onwards) meaning payroll costs of just $2650 and thus equivalent citizen salary of $2,208.33/monthly (if company is honest and doesn't operate a slush fund). If the foreigner is agreeable to give say $500 monthly kickback to company (accept $1900/ mth salary), then that is additional $585 payroll discount (need to add corporate income tax labour costs deduction), so payroll costs will be $2065 and thus citizen salary ceiling will be just $1720.83/mth.
Kickbacks: https://www.straitstimes.com/singapore/ ... -kickbacks
At this point of salary ceiling/ higher $2,208.33/monthly (honest employer) , it is financially wise to retrench the Singaporean employee and hire a foreign employee instead.
S-pass levy rates:
source: https://www.singaporebudget.gov.sg/docs ... nnexc3.pdf
Reference:
Spoiler: show
For updates and discussion on this topic, please refer to https://forums.hardwarezone.com.sg/eat- ... 09788.html
~ Matthew 25:40: "The King will reply, 'I tell you the truth, whatever you did for one of the least of these brothers of mine, you did for me.'"- (NIV)