Abu Dhabi issues new salary scale and increases pensions for government employees​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​

Under an Executive Council resolution, all government staff will be transferred on to the new pay system

Around 30% of GCC companies have made salary reductions of 15-25%, according to a recent Mercer survey. Getty Images

The Executive Council issued a new salary scale for all Abu Dhabi government employees on Tuesday, along with plans to increase retirement pensions “significantly".

All salary scales and allowances will be unified and consolidated, with employees in Abu Dhabi civil government entities transferred on to the new pay scale from January 1, which factors in all grades of employment.

“The new salary scale aims to increase retirement pensions, ensure parity across government entities and improve performance,” the Abu Dhabi Government Media Office said in a tweet.

The tweet also said employees’ gross salaries will not be affected by the new move and that new “motivating incentives” will be introduced “to attract and reward outstanding talent”.

Another tweet said pension payments will be calculated on almost 80 per cent of gross salary to boost retirement income.

"Previously, repayments were calculated only on basic salary," the media office said in a separate statement, published on state-run news agency Wam.

"The changes will help achieve excellence in government performance and increase retirement pensions, in line with the leadership’s wishes to enhance liveability standards for UAE nationals during and after their civil service careers," it added.

By unifying the salary scale, grading systems and allowances across all government entities, the Executive Council said it hopes to "achieve equality and fairness, while enhancing competitiveness within the government sector".

"It will also give employees the opportunity for promotion according to their performance," it added.

The cost of the resolution will be covered by the Abu Dhabi Government, with the new system also offering Emirati graduates access to paid training contracts to enhance their careers.

“This reflects the leadership’s wishes to enhance quality of life for Emirati people. All incremental costs will be met by the government,” the media office said.

While the General Pension and Social Security Authority is the federal body administering the pensions for most of the UAE, Abu Dhabi has its own scheme.

Founded in 2000, the Abu Dhabi Retirement Pensions and Benefits Fund manages contributions, pensions and end-of-service benefits for Emiratis working in or retired from the government, semi-government and private sectors in Abu Dhabi and their beneficiaries.

According to Article 30 of Law No. 2 of 2000, the current retirement pension is calculated at 48 per cent of the monthly salary or wage once subscription in the fund reaches 15 years, increasing by 3.2 per cent for each additional year thereafter, with a maximum of 80 per cent of monthly salary.

Those working longer than 25 years receive additional benefits.

Under the existing scheme, if an employee contributes 5 per cent of their monthly salary, a government employer contributes 15 per cent.

The number of registered Emirati members reached 88,997 in October, according to data from the fund, with 56 per cent being men and 44 per cent women.

The number of active members at the end of 2018 was 88,662, an increase of 1 per cent over the total at the end of 2017.​

In May, the GPSSA said UAE government and private sector employers that fail to register Emiratis for retirement benefits would be penalised.

Registration of Emirati employees and payment of monthly contributions is mandatory by law, the federal body said in a statement at the time.

"Any delay in the payment of these contributions will result in fines or penalties imposed on the employer only as the insured does not bear any financial obligation in this case," said Hanan Al Sahlawi, GPSSA's acting executive director.

He said there are no exemptions to this rule.

Expatriate employees have their end of service entitlement covered separately by the UAE's end-of-service gratuity scheme.