8th Pay Commission update: The Union government approved the Terms of Reference (ToR) of the 8th Pay Commission last month ending the long wait of over 50 lakh central government employees and more than 69 lakh pensioners who are now calculating how much salary and pension hike they can expect when 8th CPC recommendations are implemented. Similar to previous Pay commissions the salary hike and pension revision will depend on the fitment factor which is used to determine salary structure for employees and pensioners. What will be the minimum basic salary of central govt employees? Similar to previous Pay commissions the salary hike and pension revision will depend on the fitment factor which is used to determine salary structure for employees and pensioners. The fitment factor in the 7th Pay Commission was 2.57 and based on various estimates is expected to be between the range of 1.83 and 2.46 in the 8th Central Pay Commission. Thus even at the lower limit of 1.83 the minimum basic salary of central government employees will witness a significant jump from the current Rs 18000 to Rs 32940. If we take the upper limit of the expected fitment factor the minimum basic salary will be hiked to Rs 44280 providing a much needed shot in the arm for millions of employees amid rising prices. According to experts the minimum wages are expected to increased by 14% to 54% under the 8th Pay Commission. How fitment factor determines salary hike? Fitment factor which is used to restructure the salary structure of employees in every Pay commission is arrived upon after taking into to account various factors such as inflation cost of living index and Dr. Wallace R. Aykroyd’s formula which was originally designed to calculate a need-based minimum wage. The formula accounts for essentials like food clothing and housing for an employees plus family often a spouse and two children based on consumption units. The fitment factor for the 7th Pay Commission was fixed at 2.57 and is expected to be between the range of 1.83-2.57 for the 8th Pay Commission. When will 8th Pay Commission be implemented? Last month on November 3 Prime Minister Narendra Modi-led Union Cabinet approved the terms of reference (ToR) of the 8th Pay Commission which will benefit 50 lakh central government employees and 69 lakh pensioners and will have implications on the emoluments of the staff of state governments. If we go by the implementation of previous pay commissions the government usually takes about 18 to 24 months to implement the recommendations of the commission. Thus its unlikely that 8th Pay Commission would be implemented before mid-2027 while reports suggest that the next CPC implementation might be pushed back to early 2028.