The Local Qualifying Salary (LQS) determines the number of local employees who can be used to calculate a firm’s Work Permit and S Pass quota entitlement. The LQS is $1,400 today.
The LQS ensures that local workers are employed meaningfully, rather than on token salaries for firms to access to foreign workers. The LQS is reviewed regularly to keep pace with rising local wages and ensure that our quota controls remain effective.
The LQS was previously known as the Full-Time Equivalent salary.
How is the LQS used in the computation of foreign worker quota
A Singaporean or Permanent Resident employee employed under a contract of service, including the company’s director, is counted as:
- 1 local worker if they earn the LQS of at least $1,400 per month.
- 0.5 local worker if they earn half the LQS of at least $700 to below $1,400 per month.
New LQS requirement as part of the Progressive Wage moves
Since 1 September 2022, firms employing foreign workers e.g. Work Permit, S Pass or EP holders are required to pay
- PWs to local workers covered by the relevant Sectoral or Occupational PWs in cleaning, security, landscape maintenance, and retail sectors, and in-house workers covered by the PWM
- At least the LQS to all other local workers
The LQS requirement is as follows:
|For locals working part-time
i.e. < 35 hours/week
≥ $9/hr gross
For monthly rated part-timers, the hourly gross rate is calculated as follows to check if it meets the ≥ $9/hr gross requirement:
(total monthly gross wages) ÷ (total hours worked for the month)
|For full-time locals working full time
i.e. 35-44 hours per week
≥ $1,400 gross
|For full-time locals working overtime
i.e. > 44 hours/week
LQS requirement will increase for every hour of overtime work. You can refer to the LQS wage schedule.
Calculation of foreign worker quota for firms will remain unchanged with the new LQS requirement.
You hire a part-time local worker:
- He works 10 hours per week, and earns $450 monthly gross wages (i.e. $10.30/hour).
- Hence, you will fulfil the new LQS requirement for part-timers.
- You can continue to hire new foreign workers and renew existing foreign workers.
- However, your part-time local will not be counted towards your quota entitlement as he earns a monthly gross wage below $700.