8th Pay Commission Salary Hike Update: Lower Fitment Factor May Limit Real Growth to 13%, Unions Demand Parity With 7th CPC Structure
Central government employees may see only a modest 13% effective salary hike under the upcoming 8th Pay Commission, significantly lower than the 14.3% raise implemented during the 7th Pay Commission, as per a report by Kotak Institutional Equities. The proposed fitment factor of 1.8—used to revise basic pay—is a sharp drop from the 2.57 factor used earlier.
New Delhi, July 23: Central government employees may see only a modest 13% effective salary hike under the upcoming 8th Pay Commission, significantly lower than the 14.3% raise implemented during the 7th Pay Commission, as per a report by Kotak Institutional Equities. The proposed fitment factor of 1.8—used to revise basic pay—is a sharp drop from the 2.57 factor used earlier.
While the 1.8 multiplier suggests an 80% rise in basic pay, the real increase will be limited because the dearness allowance (DA), currently at 55%, will be reset to zero when the new pay structure is rolled out. For instance, the current minimum basic salary of INR 18,000 could rise to around INR 32,400, but employees will lose the existing DA component of INR 9,900, resulting in a net effective hike of just 13%. Similarly, a basic salary of INR 50,000 may be revised to INR 90,000, but with the current INR 27,500 DA removed, the increase will remain modest—from INR 77,500 to INR 90,000, excluding other allowances. 8th Pay Commission Update: When Will Central Government Employees Get 30–34% Hike? Check Details.
Employee unions have raised concerns, demanding a fitment factor at least equal to the 7th CPC’s 2.57, arguing that anything less undermines the rising cost of living and inflation pressures. The National Council–JCM, which represents staff and pensioners, has formally pushed back against the proposed structure. 8th Pay Commission: Central Govt Employees May See Salaries Triple by 2027 As Fitment Factor Set To Rise.
The 8th Pay Commission is expected to be formally constituted in the coming months, with its recommendations likely to be implemented around 2026, though growing pressure may influence revisions to the final framework.
(The above story first appeared on LatestLY on Jul 23, 2025 03:05 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).