Overview: Immigration Policy Updates as at January 2026
Following Cabinet approval on 17 October 2025, the Malaysian Ministry of Home Affairs (“MOHA”) has announced a revised expatriate employment policy which introduces significant changes to the Employment Pass (“EP”) framework. The minimum salary thresholds for EP Categories I, II and III have been increased, the duration of expatriate employment in Malaysia has been extended correspondingly, and expectations around succession and localisation planning have been strengthened. These changes will take effect from 1 June 2026.
These changes are aligned with the Government’s MADANI principles, which emphasise the long-term development of local human capital, and supports the objectives of the Thirteenth Malaysia Plan (RMK-13) to reduce reliance on foreign labour while prioritising the employment and development of qualified local talent.
The policy seeks to ensure that the employment of expatriates genuinely complements and catalyses the development of local capacity, instead of allowing prolonged reliance on foreign talent without a structured localisation strategy. Against this backdrop, expatriates working in Malaysia are expected to provide tangible added value, including skills transfer, leadership development and contribution to the growth of local talent.
Key Updates
- With effect from 1 June 2026, all new and renewal EP applications must comply with the revised minimum salary requirements for EP Categories I, II and III.
- In addition to the increased salary thresholds, the policy introduces changes to the determination of expatriate employment duration and formalises the requirement for a structured replacement or succession plan, particularly for EP Categories II and III. These succession plans will be subject to monitoring through documentation requirements, periodic reporting and assessment by the relevant authorities. Employers should note that failure to implement an approved succession plan may adversely affect future EP applications.
- Under the revised framework, each EP category is now imposed a maximum employment duration, reflecting the government’s intention to prevent prolonged reliance on expatriates and to encourage progressive development of local talent. While extensions beyond the prescribed period may be considered, such extensions will be evaluated on a case-by-case basis and are subject to national interest considerations.
- Please refer to the table below outlining the revised minimum salary thresholds with the EP duration:
| EP Categories | Current Minimum Salary | Revised Minimum Salary (Effective 1 June 2026) | Employment Pass Duration |
| Category I | RM10,000 and above | RM20,000 and above | Up to 10 years |
| Category II | RM5,000 – RM9,999 | RM10,000 – RM19,999 (with succession plan) | Up to 10 years |
| Category III | RM3,000 – RM4,999 | RM7,000 – RM9,999 (manufacturing & manufacturing-related services) RM5,000 – RM9,999 (general sectors) | Up to 5 years (with succession plan) |
- The increase in minimum salary thresholds is intended to ensure that EP Category I positions are reserved for strategic and critical roles that directly contribute to economic growth and technology transfer. At the same time, the revised policy seeks to ensure that the employment of expatriates is focused on high-impact expertise and does not replace roles that can be filled by the local workforce.
- MOHA has indicated that further detailed guidelines will be issued to clarify implementation and enforcement.
- Notably, all EP categories, including EP Category III, are now permitted to bring dependents (spouse, children under 21 and parents through Long Term Social Visit Pass applications).
- This policy will apply prospectively, and transitional arrangements for existing expatriates are expected to be announced.
For further information, employers may visit the Expatriate Services Division official website and Malaysia Digital Economy Corporation (“MDEC”) official website. Additionally, the Frequently Asked Questions (“FAQ”) issued by MOHA provide official clarifications on the revised policy.
As at the time of this update, the Iskandar Malaysia Expatriate Service Centre (“IRDA XPATNOVA”) has not issued any specific announcement in relation to the revised EP salary policy. However, it is anticipated that the revised requirements will similarly apply to EP applications submitted through IRDA XPATNOVA.
Related Regulatory Considerations and Developments to Watch
In view of the revised salary thresholds for EP holders, we will continue to monitor developments and provide updates on any corresponding changes to related regulatory requirements, including:
- The employer’s obligations to advertise vacancies via MYFutureJobs for positions with a monthly salary below RM15,000; and
- The minimum salary requirements applicable to Residence Pass–Talent (RP-T) holders, which currently require a basic monthly salary of RM15,000, excluding allowances and bonuses.
As the revised expatriate employment policy will take effect from 1 June 2026, employers are accorded an approximate six-month preparation period to review workforce structures, adjust cost planning, and implement succession and localisation plans in an orderly and non-disruptive manner. Employers are strongly encouraged to plan ahead and align their workforce strategies for upcoming new and renewal EP applications to ensure full compliance with Malaysia’s updated immigration regulations and policies.
For any immigration-related inquiries, please contact Ms. Suganthi Singam at suganthi@shearndelamore.com or Ms. Siow Wei Qing at weiqing.siow@shearndelamore.com.
References:
- FAQ on Revised Employment Pass Salary Policy Effective 1 June 2026.
- Press Release issued by the Ministry of Home Affairs.
