If you employ Work Permit holders you may be limited by a quota for your industry. You will also have to pay a monthly levy for each worker.
The foreign worker levy, commonly known as “levy”, is a pricing mechanism to regulate the number of foreigners in Singapore.
The levy liability will start from the day the Temporary Work Permit or Work Permit is issued, whichever is earlier. It ends when the permit is cancelled or expires.
As an employer, you don’t have to pay Central Provident Fund (CPF) contributions for foreign employees. However, you must pay a monthly levy for Work Permit holders.
Levy rate and quota
The levy you pay generally depends on two factors:
- The worker’s qualifications.
- The number of Work Permit or S Pass holders hired.
Find out the levy requirements by sector:
Levy rates are regularly reviewed and adjusted as required. See the levy rates announced in Budget 2021
Workers who possess relevant academic or skills-based test qualifications and certificates will be considered as higher-skilled workers and qualify for higher-skilled worker levy.
Dependency ratio ceiling
A dependency ratio ceiling, or quota, is the maximum ratio of foreign employees to the total workforce that a company in a given sector can employ.
The quota for the manufacturing sector is 60%. Hence, up to 60% of a manufacturing company’s total workforce (sum of local workers, S Pass and Work Permit holders) may consist of S Pass and Work Permit holders.
Calculate your quota