Want to work in Malaysia? Salary hike relief announced for foreign workers

Good News for Foreign Workers: Malaysia Extends Lower Salary Thresholds Until 2027

Foreign professionals and multinational companies operating in Malaysia have received a temporary reprieve from upcoming work visa salary hikes, with authorities confirming that certain language-skilled foreign workers will continue to qualify under existing salary requirements for another year.

 

Malaysia Digital Economy Corporation (MDEC) has announced that Employment Pass Category III applications within the Global Business Services (GBS) sector that require native or near-native language proficiency will continue to be assessed under current salary thresholds until June 1, 2027.

 

"MDEC has also indicated that companies anticipating significant operational impacts from the revised policy may engage directly with the agency for further discussions. Any flexibility or exemptions will remain subject to applicable policy requirements and approval by the relevant authorities," immigration firm Fragomen said in a post. 

   

What does this mean? 

If you are a foreign professional hoping to move to Malaysia for a customer support, shared services, multilingual operations or business services role, there is some good news. Malaysia has confirmed that certain foreign workers with native or near-native language skills will continue to qualify for work permits under existing salary requirements until June 2027, even as the country prepares to significantly raise salary thresholds for most foreign professionals from next year.

 

The relief applies to Employment Pass Category III applications in Malaysia's Global Business Services (GBS) sector, one of the country's largest employers of foreign talent. The exemption is particularly relevant for professionals hired because of their fluency in languages such as Japanese, Korean, Mandarin, Arabic, German, French and other languages that multinational companies often struggle to recruit locally.

 

For many foreign workers, the announcement could mean the difference between qualifying for a Malaysian work visa and falling short of the new salary requirements.

 

The move comes ahead of major changes to Malaysia's Employment Pass framework that take effect on June 1, 2026. Under the revised rules, minimum salary requirements across all three Employment Pass categories will rise sharply. The minimum salary for Category I will double from MYR 10,000 to MYR 20,000 per month. Category II will increase from MYR 5,000-9,999 to MYR 10,000-19,999, while Category III will move from MYR 3,000-4,999 to MYR 5,000-9,999.

 

For foreign professionals already working in Malaysia, the changes are important because they will apply not only to new applications but also to visa renewals filed after June 1, 2026. Workers whose salaries fall below the new thresholds could potentially face challenges during future renewals unless employers adjust compensation packages.

 

For foreign professionals already working in Malaysia, the changes are important because they will apply not only to new applications but also to visa renewals filed after June 1, 2026. Workers whose salaries fall below the new thresholds could potentially face challenges during future renewals unless employers adjust compensation packages.

 

"All new and renewal Employment Pass applications filed on or after June 1, 2026 must meet the updated salary thresholds. Employers are advised to proactively review and adjust their foreign knowledge worker workforce planning and compensation frameworks to minimize potential disruptions to future assignments and renewal filings," said Fragomen.

 

This is why the latest exemption is significant.

 

Malaysia Digital Economy Corporation (MDEC) has confirmed that eligible language-dependent Category III applications within the GBS sector can continue to be assessed under the current salary framework until June 1, 2027. In practical terms, companies that depend on multilingual foreign workers may continue hiring or renewing certain employees without immediately having to meet the higher salary bands.

 

The decision reflects the reality that some skills remain difficult to source locally. Malaysia has spent years building itself into a regional hub for multinational service centres handling customer support, finance, IT services and back-office operations across Asia-Pacific, Europe and the Middle East. Many of these operations depend heavily on foreign workers who can serve customers in multiple languages.

 

For employers, the exemption provides temporary breathing room while they adjust workforce planning and compensation structures. For workers, it may preserve job opportunities that might otherwise disappear if companies were suddenly required to raise salaries substantially.

 

The announcement also highlights a broader shift taking place across Asia. Governments are increasingly tightening work visa rules and raising salary thresholds in an effort to prioritise highly skilled foreign talent while encouraging companies to invest more in local hiring and workforce development.

 

Singapore has repeatedly increased salary requirements under its Employment Pass system. Similar trends have emerged across parts of the Gulf and other Asian economies seeking to balance economic growth with local employment priorities.

 

Malaysia's latest reforms appear designed to achieve a similar objective. By raising salary thresholds, the government is signalling that future foreign hiring should increasingly focus on specialised and higher-value roles. At the same time, the temporary exemption for language-skilled workers suggests policymakers recognise that certain international talent remains essential to the country's competitiveness as a regional business hub.

 

For foreign professionals considering Malaysia, the key takeaway is that opportunities remain available, particularly for candidates with specialised language capabilities. However, salary levels will increasingly play a central role in determining who qualifies for work authorisation in the years ahead.

 

The next twelve months will therefore be an important transition period for both employers and foreign workers as Malaysia gradually shifts toward a higher-skilled, higher-salary immigration framework while trying to preserve the talent pipelines that support its growing digital economy.