8th Pay Commission: What is the fitment factor; how it may impact salary hike of central government employees
As the central government has begun consultations with key stakeholders, including the Ministry of Defence, Ministry of Home Affairs, Department of Personnel and Training, and state governments, as part of the process to constitute the 8th Central Pay Commission (CPC) to revise pay structures for nearly 50 lakh central government employees and 62 lakh pensioners, attention is now focused on a key component of the salary calculation — the fitment factor.
According to an ET report, the fitment factor plays a pivotal role in determining how much a government employee's basic pay will rise under a new pay commission structure.
What is the fitment factor?
The fitment factor is a numerical multiplier used to calculate revised salaries. It is applied to the existing basic pay to arrive at the new basic salary under the Pay Commission. A higher fitment factor results in a proportionally higher salary.
For example, under the 7th Pay Commission, the fitment factor was 2.57 — meaning the basic pay was increased by 2.57 times to arrive at the new structure. If the 8th Pay Commission recommends a higher figure, the salary hike could range between 30% and 34%, as per initial estimates cited in reports. However there's no official word yet on the new multiplier, any upward revision will significantly impact take-home pay and pension calculations.
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Why it matters for take-home pay
A higher basic salary also boosts allowances that are linked to it, such as dearness allowance (DA), house rent allowance (HRA), and travel allowances. This means a higher fitment factor not only increases base pay but also enhances total take-home earnings.
When will the 8th Pay Commission be implemented?
While there is no official notification yet, in a written reply to the Lok Sabha, Minister of State for Finance Pankaj Chaudhary said, 'Inputs have been sought from major stakeholders, including Ministry of Defence, Ministry of Home Affairs, Department of Personnel & Training and from states.'
He added that the chairperson and members of the 8th CPC will be appointed once the commission is formally notified.
The Union Cabinet had approved the setting up of the 8th Pay Commission in January 2025, aiming to revise the pay structure of nearly 50 lakh central government employees and the allowances of about 65 lakh pensioners, according to a PTI report.
Responding to a query on when the revised pay scales would be implemented, Chaudhary clarified: 'The implementation would be taken up once the recommendations are made by the 8th CPC and are accepted by the government.'
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