8th Pay Commission Updates: There is still a lot of time for the recommendations of the 8th Pay Commission to be implemented. The amount of increase in the salary of employees after its implementation depends on what will be the fitment factor. More than 1 crore employees and pensioners are keeping an eye on this fitment factor. The Commission's decisions are expected to benefit about 50 lakh central employees and about 65 lakh pensioners (including defense and railway personnel).
Fitment factor is a multiplier used by pay commissions to convert an employee's old basic pay into the new revised basic pay.
Its basic formula is: Old Basic Pay × Fitment Factor = New Basic Pay
For instance, a fitment factor of 2.57 was implemented in the 7th Pay Commission, increasing the basic pay from ₹7,000 to ₹18,000 (₹7,000 × 2.57 = ₹18,000).
Consultation process continues in 8th Pay Commission
The 8th Central Pay Commission (8th CPC) is currently in its consultation phase and plans to interact with employee and pensioner associations, organizations of Central Government and Union Territory employees, and other stakeholders across the country. The Commission is examining desirable and possible changes in the salary structure, fitment factor, pay matrix, allowances (Dearness Allowance, Dearness Relief, HRA) and other facilities/benefits.
Basic Pay Possibility at Different Fitment Factors:
- With fitment factor of 1.83: ₹32,940
- With 2.0 fitment factor: ₹36,000
- With fitment factor of 2.57: ₹46,260
- With fitment factor of 3.83: ₹68,940
Highest demand for 3.83 fitment factor
Suggestions have been sought from employee unions and other stakeholders for the recommendations of the 8th Pay Commission. Many stakeholders have demanded higher fitment factor. According to a report by Clear Tax, employee and pensioners groups, unions and representatives have suggested 3.83 as the highest possible fitment factor.
Overall, experts' lowest estimate is between 1.83–2.0, while the industry's moderate estimate is between 2.0–2.57. However, currently the discussion on 8th CPC is going on and the fitment factor has not been decided yet. The recommendations of the commission will be implemented only after the approval of the central government.