8th Pay Commission: Discussion and speculation about the fitment factor of the 8th Pay Commission is quite intense. But, it is also an important question that how did the 7th Pay Commission decide the fitment factor of 2.57? Let’s know the answer to this. Also, we will also understand how much fitment factor experts are estimating in the 8th Pay Commission.
8th Pay Commission: Before the implementation of the 8th Pay Commission (8th CPC), curiosity has increased among the central government employees and pensioners about the fitment factor. This factor will decide how much their current salary will increase. Although the final report of the 8th Pay Commission will take time to come, but before that it is important to understand on what basis the 7th Pay Commission (7th CPC) had decided the fitment factor of 2.57. Why did it not fix it at 2.5 or 2.8?
How did the fitment factor of 2.57 come?
The 7th Pay Commission recommended that the minimum wage of ₹7000 applicable under the 6th Pay Commission be multiplied by 2.57. This resulted in a new minimum wage of ₹18,000. This calculation was not just a simple increase but had a comprehensive analysis and cost structure behind it.
Calculation based on 1957 recommendations
The 7th Pay Commission fixed the minimum wage based on the recommendations of the 15th Indian Labour Conference (ILC) of 1957. Under this, the cost of basic necessities of a family (of three members) such as cereals, pulses, vegetables, fruits, milk, sugar, meat etc. was fixed at ₹9217.99. Other expenses added to this were as follows:
- Fuel, electricity, water: ₹2304.50
- Marriage, entertainment, festivals: ₹2033.38
- Education and skill development: ₹3388.97
- Housing expenses: ₹524.07
All these together came to a total of ₹17,468.91. To this, an additional 3% of ₹524.07 was added as per the estimate of dearness allowance (125%). Thus, the total amount came to ₹17,992.98, which was rounded to ₹18,000.
How was the fitment factor decided?
The 7th Pay Commission clarified that the salary (pay band + grade pay) of an employee at any level on 1 January 2016 will be decided in the new salary structure by multiplying it by 2.57. Out of this 2.57, 2.25 part was shown as the merger of dearness allowance and basic salary. At the same time, the rest of the part was considered to be the actual salary increase.
What is the fitment factor?
The fitment factor is a multiplier, which is multiplied by the existing basic salary to decide the revised salary under the new pay commission. It is a kind of indicator of how much the total salary of the employees will be increased.
In this, the new salary is calculated in a combined form by combining dearness allowance (DA), basic salary and some additional allowances. For example, if the current basic salary of an employee is ₹ 10,000 and the fitment factor is 2.57, then the new salary will be ₹ 25,700.
Now the focus is on the 8th Pay Commission
The central government has approved the 8th Pay Commission in January 2025. Now all eyes are on the formation of the members of the Pay Commission, which is expected to be announced this month. Central employees and pensioners are keeping an eye on what fitment can be prepared in the 8th Pay Commission. According to experts, this time the fitment factor is expected to be at least 1.92 to 2.86.
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