8th Pay Commission: Expected Impact On Salary And Latest Updates

The Indian government has announced the establishment of the 8th Pay Commission, which will impact over 1 crore central government employees and pensioners. This commission will determine salary and pension revisions, with key discussions centred around the fitment factor and minimum wages. The fitment factor is a crucial multiplier used to revise salaries. The 8th Pay Commission's decisions are eagerly awaited by millions of employees and pensioners, who hope for significant revisions reflecting current economic realities.

What is the fitment factor?

A multiplication unit is used to revise salaries. In the 7th Pay Commission, it was set at 2.57, increasing the minimum salary from Rs 7,000 to Rs 18,000.

To calculate a revised salary using a fitment factor, you multiply the current basic pay (which includes basic pay and grade pay) by the fitment factor. 

Revised Basic Pay = (Current Basic Pay + Grade Pay) X Fitment Factor 

Current Demand:

Employee unions are pushing for a fitment factor higher than 2.57, while experts predict it might be around 1.92 to 2.86.

Expected Outcome:

The commission's recommendations will affect not only salaries but also pensions and allowances for central government employees, defence personnel, and pensioners.

"We are waiting for the Terms of Reference for the 8th Pay Commission to be approved. Then we will move ahead with our demand for these (fitment factor and minimum wage)," a member of the National Council-Joint Consultative Machinery, or NC-JCM, told NDTV Profit on the condition of anonymity.

NC-JCM, notably, is an official body comprising bureaucrats and employee union leaders, and its purpose is to resolve all disputes between the government and staff through dialogue. Once the ToR is approved, the staff side's focus will shift towards their demands to be made before the 8th Pay Commission, and the foremost will be their ask related to the fitment factor and minimum wages, another NC-JCM member said.

Discussions are ongoing, and the government's approval of the Terms of Reference will pave the way for finalising the fitment factor and minimum wages. The commission's decisions are eagerly awaited by millions of employees and pensioners, who hope for significant revisions that reflect current economic realities.