8th Pay Commission: Proposal to Merge Pay Scales for Central Employees in Levels 1-6

On January 16, 2025, the Union Cabinet, chaired by Prime Minister Narendra Modi, approved the creation of the 8th Pay Commission to review the salaries of nearly 50 lakh central government employees and allowances for 65 lakh pensioners.

Recommendation by National Council

The National Council of Joint Consultative Machinery (JCM) Staff Side has submitted its recommendations for the Terms of Reference (ToR) for the 8th Central Pay Commission (CPC), advocating significant changes in pay structures, allowances, and benefits for government employees and pensioners.

One of the key proposals in the ToR is the merging of certain pay scales to simplify the salary structure and address issues in career progression.

The Department of Personnel and Training (DoPT) recently requested input from the JCM Staff Side to finalize the Terms of Reference (ToR) for the 8th CPC, following government approval for its establishment last month.

Shiv Gopal Mishra, Secretary of the NC-JCM Staff Side, has submitted a detailed proposal, emphasizing key areas that require attention. One of the major recommendations is the consolidation of pay scales for government employees in levels 1-6.

The current pay scale structure consists of 18 levels, from level 1 to level 18. Under the 7th Pay Commission, the minimum monthly pay at level 1 is ₹18,000, while the maximum pay at level 18 is ₹2,50,000 per month.

Proposals by Staff Side

1. The Staff Side recommends consolidating lower pay scales to ensure fair remuneration and improved career progression. The suggestion is to merge the following levels: Level 1 with Level 2, Level 3 with Level 4, and Level 5 with Level 6.
2. This merger aims to address pay progression discrepancies and establish a clearer salary structure. It is expected that this consolidation will enhance employee growth by reducing stagnation and promoting better long-term financial development.
3. Currently, Level 1 employees earn ₹18,000 per month, while Level 2 employees receive ₹19,900. Merging these levels would result in a more favorable pay structure for Level 1 employees. With a proposed fitment factor of up to 2.86, the revised basic pay could increase to ₹51,480. Similarly, merging Level 3 and Level 4 would result in a revised salary of ₹72,930, and for Level 5 and Level 6 employees, the salary could reach ₹1,01,244 based on the same fitment factor.
4. In addition to the pay scale merger, the Staff Side strongly advocates for the immediate integration of Dearness Allowance (DA) and Dearness Relief (DR) into both basic pay and pensions.
5. The proposal suggests including a specific percentage of DA/DR in the pay structure, which would increase take-home salaries and pensions while also alleviating the impact of inflation on government employees and pensioners.

What Ways Ahead?

The Staff Side has requested the government to convene a Standing Committee Meeting to review the recommendations before finalizing the Terms of Reference for the 8th Central Pay Commission (CPC). If approved, these proposed changes could offer significant financial relief and introduce structural reforms for government employees and pensioners in various sectors.

It is expected that the government will form an 8th pay panel, consisting of three members with a chairman, later this month. The commission is expected to deliver its findings to the government within about 12 months. Following that, the government will decide on the revision of pensions and salaries for more than 1.2 crore central government employees and pensioners, based on the recommendations of the commission.

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