Employee organizations argue that if the scope of family calculation is increased, the basis for determining the basic salary will shift upward.
Background: How far has the process reached?
NC-JCM has intensified the exercise of drafting the joint memorandum for the 8th Pay Commission. Suggestions were sought from various employee organizations after the government announced the formation of the commission in January 2025. In which many groups have already submitted their recommendations. However, after the release of the Terms of Reference, some organizations lodged objections saying that their major demands were not included.
Why the discussion of “66%”?
This figure comes directly from mathematics. The 7th Pay Commission, while fixing the minimum wage, had adopted the model of 3 consumption units in which the employee, spouse and two children were included as standard. There is now a demand that the definition of family be expanded to 5 units, so that dependent parents can also be included in the calculation.
If the minimum wage is based on 5 units instead of 3 units, the ratio becomes 5/3 i.e. approximately 1.66 times. This is the basis on which the possibility of technological increase up to 66% is being talked about. Note that this is not an “immediate 66% increase”, but rather an indication of the potential impact from the change in calculation structure.
Fitment Factor: The Real Game-Changer?
Fitment factor is the coefficient by which the existing basic pay is converted into the new pay structure. In the 7th Pay Commission it was 2.57. Employees’ unions are demanding it to be raised to 3.25 or more, saying inflation and cost of living have increased significantly. If the expansion of the family unit is approved, the demand for increasing the fitment factor may become stronger, as the new calculation will stand on a higher base than before.
What will be its impact on pensioners?
The pension norm is generally 50% of the last basic pay. In such a situation, if the new salary matrix shifts upward, the pension will also increase in the same proportion. This is why pensioner organizations are keeping a close eye on this issue.
Other major demands
increase fitment factor
Proposal to increase the rate of annual salary increase
Reconsideration of restoration of Old Pension Scheme (OPS)
However, the final decision on all these demands will depend on the recommendations of the government and the commission.