Employment Pass Salary Too Low? Options for Employers in Malaysia in 2026
Since 1 June 2026, an Employment Pass (EP) needs a basic salary of at least RM5,000 a month for Category III and RM10,000 for Category II. Few employers hire a foreign engineer below RM5,000, but the band just above it is where applications get difficult. This guide covers what an employer can do when the salary for a role is low for an EP, which other passes exist, and which of them actually allow a Malaysian company to hire.
💡 Key takeaway: Meeting the minimum is not the same as getting approved. Below RM5,000 (RM7,000 in manufacturing) there is no Employment Pass at all, and in our experience applications below RM7,000 are often difficult to get approved, because it is harder to show that a Malaysian could not do the job. Your realistic options are to raise the basic salary and make a clear case for the role, hire someone who already holds a pass that lets them work for you, or hire a Malaysian engineer. Other passes such as the Professional Visit Pass and DE Rantau do not let a Malaysian company employ the person.
Where tech salaries sit against the thresholds
In our salary data, the median posting for a software engineer with 0 to 2 years of experience advertises RM5,000 a month, and for 3 to 5 years RM7,500. Across 3,853 tech postings, only about 20% reach RM10,000. Roles below the EP floor are mostly junior roles, where a Malaysian hire is the usual answer anyway. Mid-level roles often land in Category III, close to the RM7,000 line. You can check a salary in a few seconds with the EP checker, and see which tech roles meet the thresholds.
What changed in June 2026
- No more exemptions. Before June 2026, employers could apply for a minimum salary exemption for Category III. The official FAQ says these applications "will no longer apply starting 1 June 2026."
- Existing staff are affected at renewal. Any renewal application submitted after 1 June 2026 must meet the revised salary. An employee on RM3,500 who renews without a raise does not qualify. Renewals submitted before 1 June 2026 followed the old policy.
- Only the basic salary counts. Allowances, incentives and bonuses are excluded, and so is salary paid outside Malaysia. Topping up pay from an overseas entity does not help.
Hiring a foreign engineer for your team?
Seekers is a licensed tech recruitment agency in Kuala Lumpur. We find Malaysian and foreign engineers, and if your hire needs an Employment Pass, we can support the application. EP support is quoted separately from the recruitment fee.
Talk to us about a hire →Not sure the salary qualifies? Check the Employment Pass category with our free EP checker.
Option 1: Raise or restructure the basic salary
If the package is above RM5,000 but much of it is allowances, moving pay into the basic salary can bring the role into Category III. Aim above the bare minimum if you can: in our experience, applications with a basic salary below RM7,000 are often difficult to get approved, even though they meet the official floor. The reason is the principle behind the pass: ESD's policy says expatriate hiring should complement local employment opportunities, so your application has to show why a Malaysian could not fill the role, and that is harder to show for a lower-paid role. In our experience, roles that need a specific language or a specialised skill are easier to justify. Remember what comes with Category III: a maximum of 5 years with your company, and from 1 January 2027 a succession plan to prepare Malaysian staff to take over the role. The full rules are in our Employment Pass guide for employers, and the cost on top of salary is in what it costs to hire a foreign engineer.
Option 2: Hire someone who already holds the right pass
- Residence Pass-Talent (RP-T). A 10-year renewable pass from TalentCorp for experienced professionals. RP-T holders can change employers without converting the pass, so your company does not need to apply for an EP. Getting one is demanding: TalentCorp asks for at least 3 consecutive years of work in Malaysia, a basic salary of RM15,000 a month, at least 5 years of total experience and tax filed for at least 2 years, among other criteria. The spouse of an RP-T holder is also eligible for the RP-T and can then seek employment. So this route is for a small group of senior candidates.
- Dependant Pass holders are not a shortcut. The spouse of an EP holder who wants to work needs their own Employment Pass, according to ESD. The same salary thresholds apply.
- Foreign engineers already working in Malaysia on an EP with another company still need a new application from your company. See the employer checklist for a change of employer.
Passes that do not let a Malaysian company employ the person
| Pass | Who it is for | Can your Malaysian company employ them? |
|---|---|---|
| Professional Visit Pass (PVP) | Someone employed by an overseas company who provides services or training to a Malaysian company for a short period. Maximum 12 months per issuance. | No. MIDA's guidelines say PVP holders "are employed by overseas companies." For manufacturing and MIDA-regulated services, the Malaysian company must be in a MIDA sector and also needs Section 60K approval. |
| DE Rantau Nomad Pass | Remote workers employed by a foreign company not registered in Malaysia, and digital freelancers. Tech talent needs an income of at least USD24,000 a year. Valid 3 to 12 months, renewable to a maximum of 24 months. | No, not as an employee. MDEC says a freelancer may also serve Malaysian clients, so a project contract can be possible. It is a client contract, not a job on your payroll. |
| Malaysia Tech Entrepreneur Programme (MTEP) | Founders and investors starting or moving a tech business to Malaysia. | No. It is not a route for hiring staff. |
Using a pass for work it does not allow puts both the person and the company at risk. If you are unsure, ask ESD, MIDA or MDEC before the person starts.
Option 3: Hire a Malaysian engineer
For a role below RM5,000, or between RM5,000 and RM10,000 where the Category III conditions do not suit you, a Malaysian hire needs no pass, no salary floor and no succession plan. If you need someone for a project or a few months, a contract developer is another way to fill the gap.
More on the Employment Pass
- EP checker: enter a basic salary and see the category, steps and fees
- Malaysia Employment Pass 2026: guide for employers
- Which tech roles meet the EP salary thresholds
- How to make the case for a foreign hire
- What it costs to hire a foreign engineer
- Hiring a foreign engineer already in Malaysia
- The succession plan required from 1 January 2027
- How to apply for an Employment Pass, step by step
- Malaysia work passes compared: which one lets you hire
- Relocating a foreign employee: HR checklist
How Seekers can help
Seekers is a licensed tech recruitment agency in Kuala Lumpur. We find Malaysian engineers for full-time and contract roles, and foreign engineers for roles that meet the EP rules. If your hire needs an Employment Pass, we can support your application. Your Malaysian company is the employer that sponsors the pass. EP support is quoted separately from the recruitment fee. Talk to us about a hire.
Frequently asked questions
Can I still get an Employment Pass for a role paying less than RM5,000?
No. Since 1 June 2026, Category III needs at least RM5,000 basic (RM7,000 in manufacturing), and the minimum salary exemption for Category III no longer applies.
Does an existing EP holder on less than RM5,000 keep their pass?
The pass stays valid until it expires. A renewal application submitted after 1 June 2026 must meet the revised salary requirements.
Can a Malaysian company hire someone on a DE Rantau pass?
Not as an employee. A remote worker on DE Rantau must be employed by a company not registered in Malaysia. A DE Rantau freelancer may serve Malaysian clients under a contract.
Can the spouse of an EP holder work for us?
Only with their own Employment Pass, which has the same salary thresholds. The spouse of an RP-T holder can be eligible for their own RP-T, which allows them to work.
Sources
Minimum salary exemption, renewals and basic salary rules: ESD, Revised Expatriate Salary Policy FAQ (updated 12 February 2026) and policy booklet. Dependant Pass: ESD. Residence Pass-Talent: TalentCorp. Professional Visit Pass: ESD and MIDA guidelines. DE Rantau: MDEC FAQ version 10.0 (28 August 2026). MTEP: MDEC. Salary data: Seekers analysis of 3,853 Malaysian tech job postings with an advertised salary, six months to 26 October 2026; salary by years of experience from the Seekers salary checker data (27 October 2026). Rules change; confirm with the agency before you make an offer. This guide is general information, not legal advice. Last checked: 27 October 2026.