New Delhi, October 12: The central government’s 8th Pay Commission is poised to redefine salaries and pensions for millions of central government employees and retirees, promising a significant impact on their financial well-being. While the official notification is yet to be issued and the chairman and members of the commission are still to be appointed, discussions around the new pay structure have already gained momentum.

A key focus of the 8th Pay Commission is the fitment factor, a multiplier applied to an employee’s basic pay to calculate revised salaries and pensions. The formula is straightforward:

Revised Salary = Basic Pay × Fitment Factor

This factor accounts for inflation, changes in living costs, and overall economic conditions. Reports suggest the government may also consider the Aykroyd formula, developed by Dr Wallace Aykroyd, which estimates wages based on minimum living costs—including essentials such as food, clothing, and housing—ensuring salaries meet the nutritional and lifestyle needs of workers. 8th Pay Commission: Brokerage Firms Predict 13% to 54% Hikes, Know How Much Increase Central Government Employees and Pensioners Can Expect.

Under the 7th Pay Commission, central government employees had a minimum basic pay of INR 18,000, while pensioners received INR 9,000. The fitment factor was set at 2.57, with the highest pay for apex-level positions like the Cabinet Secretary at INR 2,50,000. Recently, a 3% hike in Dearness Allowance (DA) and Dearness Relief (DR) raised them to 58%, increasing minimum salary to INR 28,440 and minimum pension to INR 14,220. 8th Pay Commission: Will Employees and Pensioners Have to Wait Until 2028 for Implementation?

Preliminary discussions indicate the 8th Pay Commission may set the fitment factor between 1.92 and 2.08, which could significantly enhance pay and pensions. At 1.92, minimum basic salary may rise to INR 34,560 and minimum pension to INR 17,280. At 2.08, these could reach INR 37,440 for employees and INR 18,720 for pensioners.

Once implemented, DA and DR will reset to zero, with future adjustments incorporated into the new structure. For employees and retirees, understanding the fitment factor is crucial, as it will shape their post-implementation income, offering a more sustainable, inflation-adjusted financial framework. The 8th Pay Commission thus promises a pivotal revision in government remuneration, reflecting economic realities and the cost of living.

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(The above story first appeared on LatestLY on Oct 12, 2025 03:45 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).