Punjab Govt Employees To Get DA Hike? Cabinet Sub-Committee Recommends Rise to 60%

Punjab Cabinet Minister Aman Arora announced on Friday that around 85,000 government employees recruited after July 17, 2020 will get a major increase in their Dearness Allowance, with the rate set to rise from the existing 42 percent to 60 percent. The 18 percentage point hike was recommended by a three-member Cabinet Sub-Committee comprising Finance Minister Harpal Singh Cheema, Social Security Minister Dr Baljit Kaur, and Arora himself. The recommendation has now been sent to Chief Minister Bhagwant Mann for final approval, meaning the hike is not yet formally in force, though it is widely expected to be cleared, reported ET Now.

Arora described the move as a Janmashtami gift for the affected employees and said it was aimed at correcting pay anomalies that have existed since the previous Congress government decided in 2020 to recruit new employees on Central pay scales rather than the state's own pay structure.

Why Two Pay Structures Exist

The gap between pre-2020 and post-2020 employees in Punjab stems from a structural decision the current government inherited and has now partly addressed. Employees recruited before July 17, 2020 are paid on Punjab's own pay scales, which have historically been 30 to 70 percent higher than the Central basic pay scales, meaning their total take-home salary works out considerably higher once DA is factored in. Employees recruited after that date are paid on the 7th Central Pay Commission's structure with DA added on top, and even with the new 60 percent DA rate, their salaries will remain lower than colleagues doing similar work under the older structure. Arora acknowledged this gap directly, noting that pre-2020 employees would continue to draw higher take-home salaries even after the hike. 8th Pay Commission: Dearness Allowance Projected To Hit 67% Ahead of CPC Deadline.

Of the 85,000 beneficiaries, about 71,000 were recruited under the current AAP government and 14,000 during the preceding Congress tenure.

Strike, Show-Cause Notices And The September 8 Deadline

The announcement comes at a politically sensitive moment. On August 27, more than three lakh Punjab government employees went on a statewide strike over multiple demands, including the release of pending DA instalments that have not yet been disbursed. The government's response added fuel to the fire, with departments directed to issue show-cause notices to employees who stayed absent on August 27 without authorisation. Employee unions have reacted sharply, demanding the notices be withdrawn and threatening a fresh round of mass casual leave on September 8 if no action is taken by September 7. The All India State Government Employees Federation has also warned of nationwide protests if punitive action against Punjab employees goes ahead, even as three senior ministers publicly expressed willingness to negotiate on Thursday. When Will the Dearness Allowance Increase? Latest Updates on the July DA Hike and 8th Pay Commission.

The Demand This Announcement Does Not Meet

Friday's DA hike, whatever its merits, does not address the demand that brought over three lakh employees onto the streets on August 27. Those employees, recruited before July 2020 under Punjab's own pay scales, are seeking release of their pending 18 percent DA that has accumulated but not been paid, and that demand remains unaddressed. The numbers underline the political complexity: Friday's move benefits 85,000 employees, while the ongoing agitation is led by roughly 3.15 lakh employees whose core grievance has received no matching commitment. The two groups technically have distinct demands under different pay structures, but have so far presented a united front, and whether this announcement begins to crack that unity will be the key question heading into the September 8 deadline.

Electoral Stakes Ahead Of 2027

Punjab has around four lakh government employees and 3.5 lakh pensioners, and factoring in family members, the constituency watching how the government treats its workforce is substantial. With the 2027 Punjab Assembly elections not far off, the standoff between the AAP government and its employees carries weight beyond the immediate administrative question. The state government has called employees the backbone of good governance and urged dialogue, while employee organisations have set September 7 as the deadline for notice withdrawal and September 8 for their next round of action. The next 72 hours will decide whether this becomes the start of a resolution or a deeper complication.

(The above story first appeared on LatestLY on Sep 05, 2026 03:11 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).