After a certain period, the Central Government engages the Pay Commission to revise the salary structure of around 5.5 million Central Government employees. Since Independence, the Central Government has set up 7 Pay Commissions (latest one) that review and recommend changes in the emolument structure of defence and civil personnel of the Government of India.

Want to know more about Pay Commission and, more importantly, the latest 7th Pay Commission? Read along!

A Pay Commission is an administrative system and mechanism of the Central Government that reviews and examines existing salary structure and recommends changes (in pay, allowances, benefits, bonuses and other facilities) for civil employees and military forces. 

Additionally, a Pay Commission reviews rules regarding bonuses after assessing employees' performances and productivity. The Pay Commission also examines existing pension schemes and other retirement benefits.

The Pay Commission recommends only after evaluating our country's economic condition and accessible resources. This Commission primarily focuses on Central Government employees. 

As stated, around 7 Pay commissions have been set up since 1947. The latest, i.e., the Seventh Pay Commission, was set up on 8th February 2014. The Central Government forms a Pay Commission every ten years to revise the pay structure of Central Government employees. 

The government provides an 18-month window (from the date of its constitution) for submitting a recommendation via a report. This Commission may send interim reports on any matter after the finalisation of recommendations. Since this is not a constitutional body, the Central Government may accept or reject recommendations. However, the State Government usually implements recommendations after certain modifications.

The 7th Pay Commission in India introduced several significant reforms to revise government employees' salary structure. Here are the key highlights of it:

• The Government set up 7th Pay Commission during the rule of the UPA government under the chairmanship of Justice Ashok Kumar Mathur.
• There were 7 other members from different fields who collectively submitted a report on 19th November 2015.
• Their recommendations came into effect from 1st January 2016. This report focuses on the emoluments structure, allowances and conditions of services of individuals engaged in Armed Forces.
• The Ministry of Finance, under the Union Cabinet chaired by PM Narendra Modi, approved revised recommendations on allowances further on 28th June, 2017 which shall come into effect from 1st of July. 2017.

The 7th Pay Commission in India introduced notable features. These features addressed salary disparities and improved overall compensation while considering economic factors and government fiscal constraints.

Here is a list of features of the 7th Pay Commission:

New Pay Matrix

The 7th Pay Commission has recommended dissolving existing Pay Bands and Grade Pay instead of introducing a new Pay Matrix. The Central Government approved this recommendation.  Previously, authorities determined the status of an employee by grade pay, which the level will evaluate in the Pay Matrix from now on. They designed several Pay Matrixes for different groups such as Defense Personnel, Civilians, Military Nursing Services. The objective of organizing various Pay Matrixes is the same.

Minimum Pay

Instead of earning ₹7,000 per month, a newly employed entry-level government employee would suddenly be paid a minimum salary of ₹18,000. A newly engaged Class I Officer would now receive a monthly minimum wage of ₹56,100.  

Rate of Increment

The 7th Pay Commission revamped the increment rate for government employees, introducing a uniform % annual increment of 3% for all employees. This adjustment aimed to simplify the increment process and ensure consistent salary growth across various pay levels.

New Structure

Previously there were several levels at pay structure; a new structure subsumed all of these. The Central Government has approved the Index of Rationalization and collectively decided to offer a minimum pay in each level of Pay Matrix based on responsibility, accountability and increasing role as per hierarchy.

House Building Advance

Cabinet has approved the recommendation of 7th Pay Commission to raise the ceiling of House Building Advance from ₹7.50 lakh to ₹25 lakh. Further, to reduce the burden, the Cabinet has retained four interest-free advances such as TA on transfer or tour, TA for the deceased employee's family, and advances for medical treatment. However, all other interest-free advances are not functional anymore.

Monthly Contribution

The 7th Pay Commission recommended raising the amount of monthly contribution towards the Central Government Employees Group Insurance Scheme (CGEGIS). However, the Cabinet did not accept this recommendation and decided to keep the rate at the existing amount. Thus, the net salary of employees will increase by ₹1470. Additionally, the Cabinet has proposed to the Finance Ministry to introduce a customized group insurance scheme for personnel engaged with the Central Government with high-risk cover and low premium.

Fitment Factor

Fitment factor is one of the main features of 7th Pay Commission. Here, a fitment factor of 2.57 will be applicable in all levels of Pay Matrices. After considering DA, the salary or pension of Government employees or pensioners will increase at least 14.29% from 1st January 2016.

Subsuming of Allowances

The Commission has suggested completely doing away with 52 allowances. An additional thirty-six allowances were eliminated as distinct entities and replaced with either newly proposed allowances or an existing allowance. Given the rise in basic pay and the potential for future increases based on changes in DA, it was advised that the House Rent Allowance (HRA) be increased.

When an officer becomes invalidated due to disability attributed to or aggravated by Military Service, that officer will receive a grant of Disability Pension. 

This pension consists of two elements, namely Disability element and Service element. This service element is equal to the retiring pension as determined. Disability element for 100% disability is set at 30% of the last drawn salary or ₹3510 per month. If the disability is less than 100%, the amount will reduce accordingly.

This Disability Pension (including disability element and service element) of Armed Forces are exempted from income tax (as per the circular on 24th June 2019).

The above discussion covers every detail on the 7th Pay Commission. Read the information and enjoy the benefits offered through the 7th Pay Commission.

The pay scales for employees across various government departments in India are structured to reflect their roles, responsibilities, and expertise, ensuring fair compensation and attracting skilled individuals to public service.

The pay scale for assistant professors in India varies depending on the institution, location, and academic qualifications. 

The associate professor received a monthly grade pay of  ₹8,900, with a compensation range of  ₹37,400 to  ₹67,000. According to the 7th Pay Commission, assistant professors will make between  ₹1 lakh and  ₹2 lakh monthly, with a grade pay of  ₹ 27,000. According to reports, this idea is projected to benefit approximately 47 lakh assistant professors and 52 lakh pensioners.

Each employee has a different pay scale based on their position and title. Bank managers receive a monthly salary of  ₹45,000, but regular bank clerks receive a base pay of  ₹11,765.

The 7th Pay Commission's reforms have satisfied many government employees, but the CISF is not thrilled with the outcome. Day or night, the Central Industrial Security Force works in a challenging environment. The 7th Pay Commission's decision to maintain the CISF's pay scale at the same level as civil pay was disappointing. An Apex amount of  ₹80,000 has been offered to paramilitary soldiers.

The Gramme Dak Sevak GDS pay scale BMP Workers GDS are primarily found in rural areas and are currently considered a distinct agent within the postal service. They work about four or five hours daily and are compensated with a time-related continuity allowance. 

They also need to work a second job to make ends meet. However, per the 7th Pay Commission, certain modifications have been made to the BMP staff wage scale.

Like many other divisions, IAS officers will receive three times their current pay if the Seventh Pay Commission is implemented. The 6th Pay Commission's adjustments are being applied to IAS officer compensation. Pay for IAS Officers will start in 2017 per the 7th Pay Commission's recommendations. The wage scale will increase from  ₹15,600 to  ₹39,100 to  ₹29,900 to  ₹1,04,400 monthly. The monthly grade pay would also increase from  ₹5,400 to  ₹16,200.

Their role influences an IPS officer's salary. The band system determines their pay. Band-III junior time scale employees make between  ₹ 15,600 to  ₹ 39,000 monthly, with a grade salary of  ₹ 5,400. 

On the other hand, senior time scale employees have a grade pay of  ₹ 6,600 and are paid between  ₹ 15,600 and  ₹ 39,100 every month. Junior administrative staff members receive a monthly salary ranging from  ₹ 15,600 to  ₹ 39,100, with a base pay of  ₹ 6,600.