8th Pay Commission: Salary hike, fitment factor, what to expect
What's the story
The 8th Pay Commission is set to revise salaries, pensions, and allowances for some 55 lakh central government employees and around 69 lakh pensioners. The commission has been formed by the government, and its Terms of Reference (ToR) have been finalized. However, key elements such as the fitment factor, salary hike percentage, and other benefits are still being deliberated.
Factor explained
What is fitment factor?
The fitment factor is a multiplier that revises the basic pay of central government employees and pensioners. It plays a crucial role in determining the new salary structure. For instance, under the 7th Pay Commission's fitment factor of 2.57, an employee or pensioner's basic pay of ₹15,000 was revised to ₹38,550 (₹15,000 x 2.57).
Union demands
Employee unions' demands on fitment factor
For the 8th CPC, employee unions have largely focused their submissions on a higher fitment factor and a significant hike in minimum basic pay. While some have demanded fitment factors between 3 to 5 or more, pension experts think these demands may not be feasible fiscally. The commission could consider a fitment factor of 2.64 with changes in minimum wage calculation methodology by increasing family consumption units from three to five.
Hike expectations
How salary hike is calculated
The final salary hike will depend on the fitment factor recommended by the commission and accepted by the government. An example shows that an employee with a basic pay of ₹100 currently earning ₹160 after including 60% dearness allowance would see their basic pay doubled to ₹200 through a revised fitment factor. In this case, the effective increase over the existing ₹160 would be around 25%.
Timeline details
ToR approved in October last year
The government approved the ToR for the 8th Pay Commission in October 2025, giving it 18 months to submit its recommendations. Even though the commission was implemented from January 1, 2026, replacing the previous one, it is expected to take around that time to complete its work. The deadline for submission of memoranda has also been extended to June 15, 2026.