The 8th Pay Commission was officially announced in January 2024 and is expected to be established soon.
It aims to revise the salaries, pensions, and allowances of central government employees and retirees.
8th Pay Commission Officially Announced in January 2024 Is Expected To Be Established Soon
Pay commissions have historically been set up approximately every 10 years.
The 6th Pay Commission (2006) and the 7th Pay Commission (2016) both led to significant increases in basic pay and allowances.
Under the 6th CPC, the minimum basic salary rose from Rs 2,750 to Rs 7,000.
Under the 7th CPC, the minimum basic salary increased further from Rs 7,000 to Rs 18,000.
Employees and pensioners are primarily concerned about the expected salary hike under the 8th Pay Commission.
The fitment factor is a multiplier used to revise the basic pay of government employees when a new pay commission is implemented.
The formula for revised basic pay is:
New Basic Pay = Old Basic Pay × Fitment Factor
In the 7th Pay Commission, the fitment factor was 2.57.
For example, a basic pay of Rs 10,000 under the 6th CPC became Rs 25,700 with the 2.57 fitment factor:
Rs 10,000 × 2.57 = Rs 25,700
Reports suggest that the fitment factor under the 8th Pay Commission could be 1.96.
If the fitment factor is 1.92, Level 1 employees could see a monthly salary increase of about Rs 15,000.
This hike would represent roughly a 40% increase in take-home pay for Level 1 employees.
Pay Matrix System Introduced in the 7th CPC Categorizes Jobs From Level 1 to Level 18
The Pay Matrix system introduced in the 7th CPC categorizes jobs from Level 1 to Level 18.
Level 1 includes entry-level roles like peon, clerk, and MTS.
Level 18 includes high-ranking roles like Cabinet Secretary.
For Level 1 employees, salary calculation using a 1.92 fitment factor would look like this:
Basic Pay: Rs 18,000 × 1.92 = Rs 34,560
Dearness Allowance (DA @ 57%): 57% of Rs 34,560 = Rs 19,699
House Rent Allowance (HRA @ 8%): 8% of Rs 34,560 = Rs 2,765
Transport Allowance (TA): Rs 1,350 (fixed)
Gross Salary: Rs 58,374
Deductions would be:
NPS (10% of Basic + DA): 10% of Rs 54,259 = Rs 5,426
CGHS: Rs 250 (fixed)
Net Salary after deductions: Rs 52,898
This reflects a net increase of Rs 15,044/month compared to the current average net salary of around Rs 37,854 under the 7th CPC.
