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Discussions regarding the 8th Central Pay Commission (8th CPC) have intensified among more than 1 crore serving employees and pensioners of the Central Government. Following the demands put forward by the employee organizations and the National Joint Consultative Mechanism (NC-JCM) to the government, the biggest jump in the salaries of the employees in the lower pay scale i.e. Level-1, Level-2 and Level-3 of the pay matrix is expected. If the fitment factor in the Commission’s recommendations is approved as per earlier estimates, then the minimum basic salary of Group-C and entry level employees can reach up to double, which is likely to give a bullet train-like speed to their career and promotion.
Mathematics of Fitment Factor: How much will be the increase in basic salary?
The main basis for increase in in-hand salary and basic pay of employees in the Pay Commission. Fitment Factor It happens. In the 7th Pay Commission, the minimum pay was increased from ₹7,000 to ₹18,000 based on the Common Fitment Factor of 2.57.
Various fitment factor models ranging from 1.92 to 2.86 have been proposed by employee organizations for the 8th Pay Commission:
| Pay Level | Minimum Basic in 7th Pay Commission | Basic at 1.92 fitment factor | Basic on 2.57 Fitment Factor | Basic at 2.86 fitment factor |
| Level-1 (Grade Pay ₹1800) | ₹18,000 | ₹34,560 | ₹46,260 | ₹51,480 |
| Level-2 (Grade Pay ₹1900) | ₹19,900 | ₹38,208 | ₹51,143 | ₹56,914 |
| Level-3 (Grade Pay ₹2000) | ₹21,700 | ₹41,664 | ₹55,769 | ₹62,062 |
Why will Level-1, Level-2 and Level-3 employees get the biggest benefits?
In the central services, Railway Trackmen, Khalasi, Multi Tasking Staff (MTS), Lower Division Clerk (LDC), Upper Division Clerk (UDC), Postal Assistant and Paramilitary Forces (CAPF) personnel fall in the range of Level-1 to Level-3.
The main benefits available to these categories of employees are as follows:
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Minimum Living Wage: Keeping in mind the current index of inflation (AICPI-IW), the main focus of the Commission is to strengthen the purchasing power of the lower level employees, due to which the percentage increase in their salary is expected to be higher than that of higher officials.
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Merger of Dearness Allowance (DA) into Basic: At the time of implementation of the Pay Commission, the existing dearness allowance is reduced to zero and a new pay matrix is prepared by incorporating it into the basic pay, which will directly double the monetary value of the future 3% or 4% DA hike.
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Huge increase in HRA and allowances: As the basic salary increases, House Rent Allowance (HRA), Transport Allowance (TA), Children’s Education Allowance (CEA) and overtime allowance will also automatically increase in the same proportion.
Revised MACP system and pace of promotion
Apart from the salary increase, the biggest change for Level-1, 2 and 3 employees is being proposed in the rules of their career growth and promotion.
Under the Modified Assured Career Progression (MACP) scheme currently in force, employees are given financial upgradation at 10, 20 and 30 years of service. Employee unions have demanded that the time limit of MACP be reduced to eliminate the problem of stagnation among lower level employees. every 7 or 8 years Let’s do. With this, a Level-1 employee will be able to easily reach Level-4 or Level-5 pay scale within the first 15 years of his career.
Direct impact on pension and gratuity fund
This historic increase in basic salary will also have a direct positive impact on retirement benefits. Gratuity of employees will be calculated on the basis of new basic pay, while there will be a huge increase in leave encashment and monthly accumulation of pension fund, which will provide complete financial security to the employees both during service and retirement stage.