8th Pay Commission latest news: Big proposal for merger of level-1 to level-6 in 8th Pay Commission! Know how your salary structure will change, how much will the basic pay increase and how many promotion opportunities will be available. Likely to be implemented from January 1, 2026.
8th Pay Commission latest news: Another big and explosive news is coming out regarding the 8th Pay Commission for central employees. Not only increase in salary and pension, but this time a revolutionary change can be seen in the entire structure of your pay level. Yes, a suggestion has been given to the government which, if implemented, can prove to be a ‘game changer’ for employees from level-1 to level-6. The proposal is to merge these 6 levels and make only 3 levels. This simply means that there can be a tremendous jump in your basic salary and opportunities for career advancement (promotion) can also be found fast. So let’s know the whole concept of level merger and explain how it will happen and what effect it will have on your pocket.
8th Pay Commission: Why is it so special and when will it be implemented?
The Pay Commission constituted every 10 years for central government employees and pensioners recommends revision of their salary, allowances and pension. The formation of the 8th Pay Commission was approved by the Union Cabinet on 16 January 2025, and it is expected that its recommendations will be implemented from 1 January 2026. More than 50 lakh central government employees and about 65 lakh pensioners are expected to benefit directly from this pay commission. Usually the Pay Commission focuses on issues like fitment factor (which decides the basic salary) and minimum wage. For example, in the 7th Pay Commission, the minimum basic salary increased from ₹7,000 to ₹18,000 with a fitment factor of 2.57. In the 8th Pay Commission too, a good increase in salary is expected based on the fitment factor (potentially 1.92 or more), due to which the basic salary of a level-1 employee can increase from ₹18,000 to about ₹34,560. But this time another big change is in discussion – merger of pay levels.
8th Pay Commission: What is the revolutionary proposal of level merger?
This time an important suggestion has been given to the government by the representatives of the employees and some experts – Merger of Pay Levels. This proposal has been given especially with the aim of improving the pay scale and career growth prospects of the lower and middle level employees.
8th Pay Commission: How will 6 levels be merged into 3?
According to the proposal, the initial 6 levels of the existing pay matrix can be reduced to 3 levels. This merger can happen in this way.
New Level A (Proposed):
It will be created by merging the existing Level-1 and Level-2.
New Level B (Proposed):
It will be created by merging the existing Level-3 and Level-4.
New Level C (Proposed):
It will be created by merging the existing Level-5 and Level-6.
8th Pay Commission: How will the employees benefit from the level merger?
If the proposal of level merger is approved, then many positive effects can be seen, especially for those employees who are currently on the lower pay scale.
1. Big jump in basic salary
When two levels are merged, the starting basic pay of the new merged level can usually be set at par or slightly higher than the higher of the two levels.
Example: Currently, the monthly basic salary of a level-1 employee is ₹18,000, and that of a level-2 employee is ₹19,900. If a ‘new level A’ is created by merging level-1 and level-2, the starting basic pay of this ‘new level A’ can be ₹19,900 or even higher (e.g. ₹21,700 which was the starting pay of level-3 in 7th CPC, or a new figure). This simply means that the basic pay of the existing level-1 employee will get a one-time hike.
Similarly, the ‘new Level B’ created by the merger of Level-3 (₹21,700) and Level-4 (₹25,500) will also have a higher starting pay, which will benefit Level-3 employees.
And the ‘new Level C’ created by the merger of Level-5 (₹29,200) and Level-6 (₹35,400) will also see a jump in the basic pay of Level-5 employees.
2. Faster promotion and better career growth
With the reduction in the number of levels, the process of reaching the next level can be faster for employees. Currently, where an employee has to cross many small levels, after the merger there will be fewer but bigger levels.
The wait for promotion will be less:
The distance between two levels can be covered by a single promotion.
More responsibilities and higher positions:
The employee can get more responsibilities at the merged level, which will improve his career profile.
The pace of salary hikes will be faster:
The salary hike with each promotion may also become more significant.
Reduction in pay anomalies
Sometimes there are some anomalies in salaries between different but close levels. Mergers can help eliminate these anomalies and create a more logical and streamlined salary structure.
Simplification of administration
Having fewer levels can also lead to some simplicity in payroll management and administrative tasks.
Which employees will benefit the most?
The existing level-1, level-3 and level-5 employees are likely to benefit the most from this merger, as when their level is merged with the higher level, their basic salary and status will improve immediately. Level-2, level-4 and level-6 employees may also get better growth prospects in the new structure, but the initial financial benefits may not be as direct as those at lower levels.
What are the challenges of this proposal and the way forward?
Although this proposal seems very attractive for the employees, there may be some challenges in implementing it.
1. Financial burden:
A large-scale increase in basic salary will increase the financial burden on the government.
2. How will seniority be decided?:
How the seniority of employees will be decided in the merged levels will be an important aspect.
3. Allocation of new responsibilities:
Will the employees of the merged level be given new and increased responsibilities immediately?
The government and the 8th Pay Commission will hold in-depth discussions on all these aspects. Right now this is just a proposal. Only after the 8th Pay Commission issues its official recommendations, it will be clear in what form the level merger is accepted, or whether it is even done or not.
8th Pay Commission: Waiting full of hope
The central employees are not only expecting an increase in the fitment factor and minimum salary from the 8th Pay Commission, but a revolutionary proposal like level merger has also brought a great hope for them. If this proposal becomes a reality, it can bring a positive change in the career and financial condition of lakhs of employees. At present, all eyes are on the official recommendations of the 8th Pay Commission, the wait for which has now become even more exciting. It will be interesting to see how the government plays this “masterstroke”.
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