8th Pay Commission Update: DA Merger, Salary Hike And 5 Key Demands Of Employee Unions
The 8th Pay Commission is currently taking feedback to revise salaries and allowances for government employees and pensioners.
Central Government Employees
The 8th Central Pay Commission (CPC) is currently holding consultations. The panel is gathering feedback from central government employees, pensioners, and unions before submitting the final report in May next year.
Government Employees Salary
The committee will review the salary structure, pay matrix, fitment factor, increments, promotions, and allowances like DA, DR, and HRA for government employees. Experts expect them to recommend necessary and practical changes.
Pensioners Union
The commission's decisions will impact over 1 crore people. This number includes 50 lakh central government employees and 65 lakh pensioners. Defence and railway staff also fall under this group.
The panel is visiting Mumbai on October 22 and 23 to hold talks with employee unions and pensioner associations.
DA Merger with Basic Pay
Let us look at the key demands:
Several employee unions have asked the central government to merge Dearness Allowance (DA) with the basic pay. The 7th Pay Commission recommended merging DA with basic pay once it crosses the 50 percent mark. The DA has already touched 60 percent right now.
PF Contribution
The government has not officially announced the DA merger with basic pay yet. However, basic pay decides the PF, pension, and gratuity amounts. The gross salary and other allowances will increase significantly if the DA merges and boosts the basic pay.
Minimum Basic Pay Demand
Major unions like NC-JCM, Maharashtra Old Pension Scheme Association, and AIDEF have demanded a hike in the minimum basic pay. NC-JCM and AIDEF want the government to fix the minimum salary at Rs 69,000, while the Maharashtra association has requested Rs 65,000.
Minimum Salary Revision
The IRTSA union has asked the government to revise the minimum salary to Rs 52,600 to match the current economic situation. Similarly, the RSCWS association stated that the government must decide the minimum salary based on the price index as of January 1, 2026.
Dearness Allowance (DA) Hike Demand
Many unions have also demanded a hike in Dearness Allowance (DA). NC-JCM stated that the salary structure must align with inflation. The Maharashtra association has asked for at least a 4 percent DA hike and a 50 percent DA merger with basic pay. AIDEF has insisted on proper compensation to tackle inflation.
Fitment Factor Hike Demand
The IRTSA union has stated that safety-related posts in the railway department need a higher fitment factor. They have suggested fixing the fitment factor at 2.92, 3.50, and 3.80 levels.
Change in DA Calculation Method
AIDEF has requested a change in the DA calculation method in their second petition to the 8th Pay Commission. Low-wage earners spend most of their income on food, education, healthcare, and house rent. The union has asked the panel to calculate DA in a more practical way to help them.
When will the 8th Pay Commission recommend?
The 8th Pay Commission must announce its recommendations within 18 months of its formation (by November 3, 2025) as per the Terms of Reference (ToR). Going by this calculation, the panel has time until May 2027 to submit the final report.
Salary Hike Announcement
The government might take another two to three years to fully implement the pay commission's recommendations. If the salary hike announcement comes in 2027, it will only come into full effect by 2029 or 2030.
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