Navigating Work Pass and Visa Requirements for Malaysian Employees in Singapore

Illustrative picture of work permit application form

Singapore companies looking to hire Malaysian talent face two main options: bringing them to Singapore on a work pass or employing them in Malaysia via an Employer of Record (EOR). Each option comes with its own challenges, costs, and compliance requirements.

In this article, we break down the complexities of hiring Malaysians locally vs. employing them in Malaysia through an EOR, so businesses can make an informed decision.

Hiring Malaysians Locally in Singapore: Work Pass Challenges

Work Pass Requirements & Quota Restrictions

1. Hiring Malaysians to work in Singapore requires a valid work pass, such as:
   ✅ Employment Pass (EP) – For highly skilled professionals earning at least $X per month
   ✅ S Pass – For mid-skilled workers earning at least $X per month, subject to quota & levy
   ✅ Work Permit – For lower-skilled roles, with stringent quotas and sector restrictions

   Employers must ensure compliance with Ministry of Manpower (MOM) regulations, which involve levies, medical insurance, and renewal limitations.

2. Higher Salary & Operational Costs

   Hiring Malaysians to work in Singapore means companies must offer higher salaries to meet work pass requirements. Employers also bear additional costs such as:

   • Work pass levies & quota fees
   • CPF (if hiring a Malaysian PR)
   • Medical insurance & foreign worker security bonds
   • Housing & relocation costs

   These costs can significantly increase overall hiring expenses and administrative workload.

3. Job Market Competition & Retention Risks

   The competition for Malaysian professionals in Singapore is high, leading to:

   • Higher attrition rates, as candidates seek better job offers
   • Tighter labor market, making it harder to secure talent
   • Work pass renewal risks, impacting long-term workforce planning

Hiring Malaysians in Malaysia Through an Employer of Record (EOR): A Simpler Alternative

Instead of relocating Malaysian employees to Singapore, businesses can employ them remotely in Malaysia through an Employer of Record (EOR). This provides greater flexibility, cost savings, and compliance benefits.

1. No Work Pass or Visa Hassles

An Employer of Record Singapore allows businesses to legally hire Malaysian employees without needing to relocate them. The EOR acts as the official employer in Malaysia, managing:
✅ Payroll processing and tax compliance
✅ EPF, SOCSO, and EIS contributions
✅ Employment contracts in full compliance with Malaysian labor laws

2. Lower Hiring & Operational Costs

Employing Malaysians in Malaysia through an EOR eliminates expenses such as:

• Work pass levies and quota fees
• CPF contributions and relocation costs
• Foreign worker security bonds

This results in significant cost savings while maintaining workforce efficiency.

3. Greater Flexibility & Business Scalability

Using an Employer of Record in Malaysia enables companies to:
✔️ Expand their team without setting up a legal entity
✔️ Scale workforce up or down based on business needs
✔️ Access Malaysian talent without the constraints of Singapore’s work pass system

This model provides an agile and risk-free approach to hiring Malaysian professionals.

Final Thoughts: Which option is best for you

For Singapore companies looking to hire Malaysian talent, both options have their pros and cons:

For businesses that require on-site employees in Singapore, securing work passes is necessary. However, if remote work is an option, employing Malaysians via an Employer of Record in Singapore provides a more cost-effective and hassle-free alternative.

Partner with Elitez for Employer of Record

If you’re looking to hire top Malaysian talent with ease, our Employer of Record services can help. Contact us today to learn how we can support your hiring needs!

In addition to Employer of Record services, businesses can benefit from working with Elitez, the leading recruitment agency in Singapore. We offer the best talent sourcing and placement. For specialized or high-level positions, our executive search firm can help identify the best candidates to drive business success. Contact us for more information.