There is good news for more than one crore government employees and pensioners. The work related to the 8th Pay Commission is now gaining momentum. The matter is being discussed vigorously in Delhi, as the Commission has started talks with employee unions and organizations. New information is coming out every day. According to the latest reports, talks with government employee unions are scheduled to begin between April 28 and April 30. Read further to understand the importance of these meetings: What demands have the organizations made regarding ‘fitment factor’? And if these demands are accepted, what impact will it have on wages?
purpose of meetings
The objective of the 8th Pay Commission is to encourage more and more employee unions to present their ideas and suggestions. However, due to time constraints, negotiations with some unions will be held later. The meetings currently underway are focusing on three main areas, including:
Fitment Factor: A Big Change
Fitment factor is the most important part of an employee’s total salary package. This can be thought of as a ‘multiplier’—a number that is multiplied by the current basic pay to arrive at the new pay. Under the 7th Pay Commission, the fitment factor was fixed at 2.57. Due to this factor, the minimum basic pay increased from ₹7,000 to ₹18,000. Now, for the 8th Pay Commission, the employee unions are demanding a fitment factor of 3.83. What would this mean? If the government adopts a fitment factor of 3.83, the current minimum basic pay could rise from ₹18,000 to about ₹69,000—an increase of almost three times.
Why the demand of ₹69,000?
The unions’ argument is simple: They say inflation has increased significantly since 2016. As a result, expenses related to house rent, children’s education and healthcare have become more expensive than before. With Dearness Allowance (DA) having already crossed the 50% mark, the reality of rising cost of living cannot be denied. In these circumstances, it is becoming increasingly difficult to meet daily needs and meet daily expenses with the current salary structure. Therefore, employees want that their salary should be increased not according to the old rules, but keeping in view the current times and today’s inflation.
What will your new salary look like?
First, a ‘fitment factor’ will be decided based on your current basic salary. Then, this factor will be multiplied by your basic salary to arrive at your new basic salary. After this, Dearness Allowance (DA), House Rent Allowance (HRA) and Traveling Allowance (TA) will be added to this new basic salary. This is why even a slight change in the fitment factor can result in a difference of thousands of rupees in your monthly salary.