There is a continuous discussion between the central government employees and pensioners regarding the 8th Pay Commission. The thing that most attention is focused on is the fitment factor. This will be the basis through which the new basic salary of the employees and its related allowances will be decided.
The higher the fitment factor, the more the basic salary of the employees and the House Rent Allowance (HRA) related to it will also increase. However, the government has not yet taken any final decision on the fitment factor.
What is fitment factor?
Fitment factor is a multiplier by which the new basic salary is determined by multiplying the existing basic salary. For example, if the existing basic salary of an employee is Rs 20,000 and the fitment factor is fixed at 2.5, then the new basic salary will be Rs 50,000. This new basic salary further becomes the basis for calculating Dearness Allowance (DA), HRA and other allowances.
How much will be the benefit from 2, 2.5 and 3 fitment factor?
According to the report, if the fitment factor is fixed at 2, then the basic salary of the employees will increase twice as compared to the current level. If the fitment factor is 2.5 then there will be more increase in salary. Whereas if the fitment factor of 3 is applied then the basic salary and HRA of the employees will increase the most.
The increase in salary of employees from Level-1 to Level-13 will vary according to their existing pay scale, but in all cases the direct effect of fitment factor will be visible.
HRA will also be directly affected
The benefit of increasing fitment factor will not be limited to basic salary only. HRA will also be decided on the basis of new basic salary. That means, for those employees who get HRA at the rate of 27%, 18% or 9%, their amount will also increase according to the new basic salary.
This is the reason why employee organizations are demanding more fitment factor, so that there is a good increase in not only the salary but also the total monthly income.
Waiting for the government’s decision
At present, the Central Government has announced the formation of the 8th Pay Commission, but the final decision is yet to be taken regarding the members, scope of work and fitment factor of the Commission. Employee organizations demand that the fitment factor should be kept between 2.5 to 3, while the final decision will be taken only after the recommendations of the commission and the approval of the government.
In such a situation, lakhs of central government employees and pensioners are now waiting for the recommendations of the Commission, because on the basis of these, the increase in their salary, HRA and other allowances will be decided.
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