How Will the Updated COMPASS Framework from 1 January 2026 Change Singapore Employment Pass Approvals for SMEs?

Singapore’s Employment Pass (EP) approval outcomes are increasingly shaped by how well an employer can evidence business substance, fair hiring, and a role that is genuinely senior and market-aligned. With the updated COMPASS framework expected to apply from 1 January 2026, SME owners and foreign founders should treat EP planning as part of workforce planning Singapore—covering role design, salary positioning, and documentation—rather than a last-minute immigration formality. This matters now because hiring decisions made in late-2025 (job scope, reporting lines, and total compensation structure) can affect 2026 EP outcomes. Paul Hype Page & Co. (PHP) supports businesses by combining Singapore Employment Pass advisory with corporate structuring, accounting & tax, payroll readiness, and compliance processes that help explain “why this hire, why this pay, why now” in a MOM-friendly way.

What is the COMPASS framework 2026 update, and why does it matter for EP outcomes?

COMPASS is the Ministry of Manpower (MOM)’s points-based assessment used to evaluate many Employment Pass applications alongside baseline eligibility requirements. In practice, COMPASS changes can shift what “strong” applications look like—especially for SMEs without a large local headcount or established brand presence.

For planning purposes, treat “COMPASS framework 2026” as two things:

A clearer expectation that the job is senior, credible, and aligned to business activity in Singapore. A stronger need to document how the candidate and the employer contribute to the local workforce and broader ecosystem.

If MOM announces specific scoring tweaks, lists, or thresholds for 1 January 2026, the operational impact will be felt most in:

• Role design and seniority signals (title alone is not enough)
• EP salary benchmarks and how total pay is presented
• Evidence of business substance (contracts, pipeline, payroll, governance)
• Hiring narrative (why foreign talent hiring is necessary and how locals are developed)

PHP’s advisory approach is to start with the business reality (commercial need and org structure), then translate it into work pass criteria and documentation that typically withstand scrutiny.

What are the MOM work pass criteria SMEs should re-check before 2026?

Even before COMPASS scoring, MOM typically expects baseline eligibility and consistency across your corporate records. For SMEs, small inconsistencies can become avoidable friction.

Key MOM work pass criteria areas to re-check:

Is the employing entity properly set up and compliant?

Common gaps include outdated ACRA records, missing corporate secretarial filings, or unclear shareholding/control details. These do not “automatically” block an EP, but they can complicate credibility.

How PHP helps: corporate secretarial & compliance monitoring, group structuring, and ensuring the employing entity’s particulars match what is presented in the EP application.

Is the role genuinely professional/managerial/executive?

MOM generally looks for senior responsibilities, decision-making authority, and the appropriate reporting line. A “Manager” title with junior tasks or no team/budget oversight can be a red flag.

Practical tip:

• Map 8–12 core responsibilities to measurable outcomes (revenue, risk, delivery, compliance)
• Show reporting line and decision rights (who signs off on what)

Is the salary aligned to EP salary benchmarks?

Salary is not just a number; it signals seniority and market alignment. Under COMPASS-style assessment, pay that appears below market for the role/industry can weaken the case.

Practical tip:

• Present fixed monthly salary clearly
• Treat variable pay consistently (bonus policy, commission basis)
• Explain allowances carefully (avoid using allowances to “inflate” base pay presentation)

PHP can support salary benchmarking and how to present total compensation packages in a way that is consistent with payroll and tax reporting.

How might COMPASS framework 2026 change what “good” looks like for SMEs hiring foreign talent?

SMEs often assume EP approval is mainly about candidate credentials. In reality, COMPASS-style evaluations can make employer context more important.

Stronger job-person fit evidence

• Role scope aligns with candidate experience (not a mismatch)
• Candidate has industry track record relevant to the Singapore entity’s activity
• Clear justification for why the role cannot be filled quickly in the local market

Clear salary logic against EP salary benchmarks

• Pay aligns with seniority, function, and sector
• Compensation structure is sustainable for the business (especially early-stage firms)

Workforce planning Singapore narrative

MOM often expects employers to think beyond one hire. SMEs can strengthen credibility by showing:

• Hiring roadmap (12–24 months)
• Local upskilling plan and team build-out
• Succession plan or knowledge transfer expectations

This is where EP advisory intersects with broader corporate services: your hiring plan should match your budgets, payroll processes, and tax reporting.

How PHP helps: linking work pass strategy with accounting, payroll setup, and budgeting so the story is consistent across applications, employment contracts, and statutory filings.

How should SMEs use EP salary benchmarks when structuring total compensation for 2026?

EP salary benchmarks are not just a compliance hurdle; they are part of positioning the role as genuinely senior. A common SME mistake is treating compensation as an afterthought, then trying to “adjust” it right before submission.

Separate fixed pay from variable pay

• Fixed monthly salary: the clearest signal
• Variable: bonuses/commissions should have a written basis

Ensure internal consistency across documents

Mismatches between:

• Offer letter
• Employment contract
• Payslips/payroll setup
• CPF/SDAs (where relevant)
• IRAS reporting

…can create avoidable questions.

Consider the tax and payroll implications early

Some packages look attractive but create payroll complexity (multi-currency components, offshore reimbursements, unclear allowances). Early coordination with payroll and tax reduces rework.

PHP can support:

• Salary benchmarking and pay structure review
• Payroll setup and recurring compliance
• Tax treatment considerations (where relevant)

Cautious note: exact benchmark figures and MOM’s weighting may change; plan with buffers and document the rationale rather than aiming for a minimum number.

What is the Shortage Occupation List Singapore, and how does it affect 2026 EP strategy?

The Shortage Occupation List Singapore (sometimes referred to as a SOL) is used to recognise roles where there is a stronger labour market need. If a role is on the list (and if MOM’s 2026 rules continue to recognise this), it can strengthen the application under a COMPASS-type framework.

Validate the role is truly the shortage occupation

Do not “rename” a job title to match the list. MOM often assesses actual duties, seniority, and domain scope.

Align job scope to occupational outcomes

• Tools and systems used (e.g., data platforms, security frameworks)
• Deliverables (e.g., risk reduction targets, product launch milestones)
• Governance responsibilities (e.g., incident response ownership)

Prepare evidence that the business needs the capability now

• Contracts requiring specific capability
• Regulatory compliance requirements
• Scale-up milestones requiring a particular leadership function

PHP typically helps SMEs interpret whether the real job matches the SOL description, and how to document it without over-claiming.

What are common EP application mistakes SMEs should avoid before 1 January 2026?

Many EP issues are preventable with earlier alignment between HR, finance, and leadership.

Writing job scopes that are too generic

“Oversee operations” or “support management” without specifics can look junior. Add measurable responsibilities and authority.

Inconsistent corporate and payroll records

• Different employing entity names across documents
• Outdated business activity description at ACRA
• Payroll not configured to match the offer terms

Underselling business substance for newer companies

Startups and new SMEs can be credible, but they need clear evidence:

• Funding runway and budgets
• Customer pipeline or signed contracts
• Office presence and operational plan

Treating COMPASS as a last-minute checklist

COMPASS-style systems reward coherence. If HR, finance, and corporate records don’t tell the same story, the application can look improvised.

PHP often supports a pre-submission “consistency review” across incorporation details, job scope, compensation, and supporting documents.

How can workforce planning Singapore strengthen your EP approval profile in 2026?

Workforce planning is one of the most practical ways for SMEs to reduce EP uncertainty. It shifts the narrative from “we want to hire this person” to “this is a planned capability build in Singapore.”

Build a simple 12–24 month org plan

• Headcount by function (sales, product, finance, operations)
• Which roles are local vs foreign hires
• What triggers the next hire (revenue, customers, project milestones)

Define the local development plan

• Training plan for local staff
• Mentorship/knowledge transfer from EP holder
• Clear KPIs for team uplift

Tie workforce plan to financial budgets

If payroll budgets don’t support the salary offered, the application can look risky. Align with your management accounts and cashflow plan.

This is where PHP’s accounting, tax, and payroll support can make the overall EP story more consistent—without turning it into a “paper exercise.”

How do role redesign and candidate assessment reduce COMPASS risk for foreign talent hiring?

Two SMEs can hire the same candidate and get different outcomes depending on role design and documentation.

Role redesign: make seniority visible

• Budget ownership
• Team leadership or vendor governance
• Policy setting or strategic decision-making
• Accountability for revenue, risk, or delivery

If the business is small, seniority can also be demonstrated through breadth of responsibility and decision rights, not just headcount.

Candidate assessment: evidence the match

• A short role-to-resume mapping (bullet list)
• Portfolio or project evidence (where relevant)
• Reference-able milestones (product launches, regional expansion, compliance achievements)

HR compliance for SMEs

• Consistent employment contract terms
• Clear probation, benefits, variable pay basis
• Document retention for audits or queries

PHP can help SMEs create a defensible role narrative, assess candidate fit against MOM work pass criteria, and ensure HR documents align with payroll and tax reporting.

Should you consider EP vs S Pass in 2026 workforce design?

EP vs S Pass decisions are not only about eligibility; they affect workforce cost, quota considerations (where applicable), and long-term talent planning.

Role seniority and career track

• EP is typically used for professional/managerial/executive roles
• S Pass is often used for mid-skilled roles (subject to prevailing rules)

Budget and staffing model

If you are building a team, mixing EP and S Pass (where appropriate) can be part of a balanced plan. However, job fit matters; forcing a role into a pass category can create compliance and retention issues.

Timing and pipeline risk

• Alternative candidate profiles
• Role scope adjustment
• Start date planning

PHP can advise on work pass strategy across EP and S Pass, including how the choice interacts with payroll setup and compliance obligations.

How do incorporation, accounting, and tax decisions affect Singapore Employment Pass credibility?

MOM assesses more than the individual. The employer’s business substance and consistency of records can influence how an application is perceived.

Incorporation and structuring

If your group spans Singapore, Malaysia, Indonesia, or Hong Kong, make sure the employing entity is logical:

• Where revenue is booked
• Where staff are managed
• Which entity signs customer contracts

Misalignment can raise questions.

Accounting and management reporting

Having clean management accounts, budgets, and payroll records helps you respond to queries quickly and supports a coherent compensation rationale.

Tax and payroll readiness

• Clear taxable vs non-taxable treatment
• Proper payroll scheduling and payslip practices
• Documentation for reimbursements and allowances

PHP supports SMEs with company incorporation & structuring, accounting & tax, payroll, and audit readiness.

What should SMEs do in late-2025 to prepare for COMPASS framework 2026?

Because the effective date is expected to be 1 January 2026, preparation typically happens in Q4 2025.

Review your 2026 hiring plan and critical roles

• Roles needed by Q1/Q2 2026
• Local hires vs foreign expertise

Refresh job descriptions and reporting lines

• Measurable outcomes
• Clear authority and seniority

Validate pay bands against EP salary benchmarks

• Fixed vs variable split
• Documented rationale

Clean up corporate compliance and records

• ACRA particulars
• Corporate secretarial filings
• Payroll and HR templates

Prepare a “response pack” for queries

• Contracts or pipeline evidence
• Funding and runway proof
• Management accounts and headcount plan
• Candidate role-fit mapping

Conclusion

If your 2026 hiring plan includes foreign talent, treat COMPASS as a workforce and business planning exercise. Strong EP outcomes come from credible role design, aligned salary benchmarks, clean records, and early preparation.