Prior to August 1995, some categories of foreign workers, most notably Employment Pass (EP) holders, had to make CPF contributions in line with the prevailing rates for Singaporeans and PRs. Similarly, their employers also had to make CPF contributions for these foreign workers.

However, after 1 August 1995, all foreigners were exempted from CPF contributions.

At the time, the Ministry of Labour, which is now the Ministry of Manpower, stated that the only reason for the change was to streamline the CPF rule for all foreign workers.

But even in 1995, there was already concern that exempting foreign workers, especially EP holders, from CPF contributions would have negative impacts on Singaporean workers, especially the middle-ranking PMETs, because employers would benefit from lower wage costs when they employ new foreign staff.