8th Pay Commission Fitment Factor Explained: How It Is Decided, What Influences It and the Possible Fitment Factor Employees and Pensioners Can Expect

New Delhi, November 28: Ever since the Centre announced the Terms of Reference and appointed the chairman and members of the 8th Central Pay Commission (CPC) in early November, government employees and pensioners have been eager to know how much their salaries and pensions may rise. The revision largely hinges on one critical element — the fitment factor, the multiplier applied to existing basic pay to determine new pay scales. Experts explain how pay commissions decide this number and what the 8th CPC may finally recommend.

According to Ramachandran Krishnamoorthy, Director – Payroll Services at Nexdigm, the fitment factor is determined based on economic and organisational considerations. It is derived by combining basic pay and grade pay and then evaluating the required increment. Key determinants include:

• Inflation And Cost-Of-Living Index: Higher inflation demands a higher fitment factor, with CPI and CPI-IW trends being closely monitored.

• Fiscal Capacity: Government budget limits and overall salary expenditure significantly influence the multiplier.

• Private Sector Parity: Market benchmarking, industry surveys, and comparisons with private sector salaries also shape the decision. 8th Pay Commission: What SSC Employees Can Expect From the 2026 Salary Revision; Know Detailed Timeline, Fitment Factor and Post-Wise Expected In-Hand Pay.

No Fixed Formula For Fitment Factor

Pratik Vaidya, MD & Chief Vision Officer, Karma Management Global Consulting Solutions, explains that there is no statutory or fixed mathematical formula. Each commission analyses prevailing economic data and policy priorities. For instance, the 7th CPC used a uniform factor of 2.57, where 2.25 represented DA neutralisation and the rest gave a 14% real hike. Committees generally follow structured steps but ultimately choose a factor based on multiple inputs, not a strict calculation. 8th Pay Commission Update: Govt Dismisses Rumours on Scrapping HRA, DA and Other Allowances; What Employees Should Know.

How The 6th And 7th CPC Determined Their Factors

The 6th CPC proposed a multiplier of 1.74, later increased by the Cabinet to 1.86 after employee unions demanded revisions. This incorporated 24% DA and 50% dearness pay into the basic salary while offering a small real raise.

The 7th CPC arrived at 2.57 by merging 125% DA (equivalent to 2.25) and adding a 14.3% real increase for employees across all levels.

Possible Fitment Factor For The 8th CPC

Manjeet Singh Patel, National President of the All India NPS Employees Federation, estimates a potential fitment factor of around 2.13. His reasoning includes:

• Current DA at 58%

• Expected additional 7% DA in the next 18 months

• 7% rise due to two annual increments

• Increase in family unit size from 3 to 3.5 (adding nearly 20% rise)

• A minimum 15% inflation-linked growth factor

If family units rise to 4 or inflation projections increase, the fitment factor could reach up to 2.64, he adds.

How The Fitment Factor Will Impact Salaries And Pensions

The 8th CPC’s chosen multiplier will substantially shape revised pay and pensions. For instance:

• A basic salary of INR 18,000 may rise to INR 32,940 with a 1.83 factor and INR 44,280with a 2.46 factor.

• A basic of INR 50,000 could increase to INR 91,500–INR 1.23 lakh depending on the multiplier.

• For pensioners, if the factor is 2.0, a current basic pay of INR 25,000 becomes INR 50,000, resulting in a basic pension of INR 25,000.

The final fitment factor will depend on inflation, fiscal room, economic conditions, and government priorities in the coming months.

(The above story first appeared on LatestLY on Nov 28, 2025 02:02 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).