8th Pay Commission: How much will be the salary hike for government employees? Know the formula here.

The central government has proposed the 8th Pay Commission, which is expected to increase the salaries and pensions of over 1 crore government employees and pensioners. With this announcement, many are curious to know how much their monthly income will increase under the new pay structure. Reports suggested that a formula similar to the 7th Pay Commission will be used to determine salary hikes for employees from Level 1 to Level 10.

What is the Aykroyd Formula?

The Aykroyd Formula, developed by Dr. Wallace Aykroyd, was designed to determine the minimum cost of living. It suggests that wages should be calculated based on the nutrition, clothing, and housing needs of the average employee. The formula was officially adopted by the 15th Indian Labour Conference (ILC) in 1957 to determine the minimum wage for an employee, their spouse, and two children.

How did the 7th Pay Commission apply the Aykroyd formula?

According to a report by Financial Express, the 7th Pay Commission applied the Aykroyd formula to increase the minimum basic pay from Rs 7,000 to Rs 18,000. It also introduced a fitment factor of 2.57, which helped revise the pay matrix for government employees and pensioners. This formula has been in place since 2016.

How much will be the salary hike under the 8th Pay Commission?

Experts believe that the 8th Pay Commission may follow the Aykroyd formula to align the salaries of government employees with rising inflation. Reports suggested that the government is considering a fitment factor between 1.92 and 2.86.

If the upper limit of 2.86 is implemented, the minimum basic salary may increase from Rs 18,000 to Rs 51,480. Similarly, the pension amount may increase from Rs 9,000 to Rs 25,740.

How will the salary and pension hike be calculated?

The fitment factor plays an important role in determining salary and pension hike. It is applied by multiplying the existing minimum salary or pension amount by the chosen fitment factor. Although the exact percentage of salary hike under the 8th Pay Commission is not yet decided, an official announcement about its structure, chairman and members is expected soon.