Tuesday, March 15, 2011

UAE Middle Managers’ Bonus and Profit Share Remuneration Falls


Dubai, UAE – 15 March 2011 - The proportion of earnings that UAE middle managers received in the form of bonuses and profit share fell by 9% from 2008 to 2010, according to the Global 50 Remuneration Planning Report by the global professional services company, Towers Watson.  The study found that in comparison, the earnings of senior managers and lower level employees saw growth in the same period. While lower management saw an increase of 2.3 % it is still not significant compared to the 12.9 % increase received by senior management.

The report which shows Towers Watson’s analysis of differing patterns of ‘at risk’ pay, found that UAE middle managers were earning an average of 16 % of base pay in bonuses and profit share in 2010 compared to 25 % in 2008. Senior managers, on the other hand, saw an average earnings of 48.9 % of base pay in bonuses and profit share, compared to 36 per cent in 2008. Lower level employees also fared relatively better in the past two recessionary years in terms of ‘at risk’ pay. In 2010 they were earning an average of 14.3% per cent of base pay in bonuses and profit share compared to 12% in 2008. Similar trends can be observed in other GCC markets like Saudi Arabia.

Anne Severeyns, Head of Operations – Data Services EMEA at Towers Watson says: "Bonuses and profit share are an important part of the overall reward package. Variable pay such as this, vitally, offers employers the ability to manage cost and performance as well as rewarding and retaining key talent.  In the current economic environment it has never been more important to have tools at hand to work out remuneration in the context of strict budgets and at the same time using it to develop those employees who are vital to business success.”
Comparison of Bonus and profit share as percentage of base pay (excluding sales roles) in the UAE for 2008 and 2010

UAE

Senior Manager (%)

Middle Manager (%)

Lower level Employee (%)

2010
48.9
16.0
14.3
2008
36
25
12
% Up/Down
+12.9
 - 9
+ 2.3







The Towers Watson Global 50 Remuneration Planning Report contains the latest pay and benefits information across 57 countries worldwide and is a planning tool that enables cross country pay comparisons and is available to purchase in full from Towers Watson.

About Towers Watson
Towers Watson (NYSE, NASDAQ: TW) is a leading global professional services company that helps organisations improve performance through effective people, risk and financial management. The company offers solutions in the areas of employee benefits, talent management, rewards, and risk and capital management. Towers Watson has 14,000 associates around the world and is located on the web at towerswatson.com.

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