8th Pay Commission: Fitment Factor Might Be Fixed Between 1.83 And 2.46, Says Report
On fitment factor between 1.83 and 2.46, the minimum salary of central government employees may be fixed between Rs 32,940 and Rs 44,280, against the current Rs 18,000 a month.
8th Pay Commission Salary Hike: Even as the 8th Central Pay Commission is yet to be constituted, a report suggests that the fitment factor is expected to be fixed in the range of 1.83 to 2.46. Fitment factor is the multiplier used to revise basic pay in a new pay commission.
'As per back-of-the-envelope calculations, depending on the salary growth seen over different Pay Commissions, the range of fitment factors that the government could be looking at lies between 1.83 and 2.46," financial services firm Ambit Capital said in a report.
What Is A Fitment Factor?
The fitment factor is a multiplier used by the government to revise the basic salary of employees when a new Pay Commission is implemented. It helps determine the new pay by applying the factor to the existing basic salary.
For example, if an employee's current basic salary is Rs 18,000 and the fitment factor is 2.0 (just for example), the revised basic salary would be Rs 36,000 (Rs 18,000 × 2.0). This does not include allowances like HRA or DA, which are calculated separately and increase overall take-home pay further.
8th Pay Commission: How Much Salary Hike Expected?
Going by Ambit Capital's expectation of a fitment factor between 1.83 and 2.46, the minimum salary of central government employees may be fixed between Rs 32,940 and Rs 44,280, compared with the current Rs 18,000 a month.
A fitment factor of 1.83 would raise the basic salary from Rs 18,000 to around Rs 32,940, while a factor of 2.46 would raise it to Rs 44,280.
Ambit Capital in the report estimates that the 8th Pay Commission may result in a minimum 14% real hike in pay (including Basic Pay+DA) and a maximum of 54%. However, the maximum 54% hike in real pay is highly unlikely as the government could face significant financial challenges in implementing the same.
'While the government might consider a higher increase, potentially using it as a consumption stimulus, expecting a substantial 54% jump (as seen during the 6th Pay Commission) seems unlikely, since it could face significant financing challenges," the report said.
For fitment factor calculations, the report has assumed real income growth of 14.3% (worst case) and 54% (best case). The middle case fitment factor is just the average of the 2 fitment factors.
Historically, pay commissions have enabled real salary hikes of 14% to 54%.
8th Pay Commission Salary Hike: Best, Worst, & Middle Case Scenarios
Sharing middle and worst case scenarios, the report pegs salary hike of central government employees at 34% and 14%, respectively.
'Our estimates suggest hikes around 30-34% could be under consideration in the 8th Pay," the report said.
'Assuming a current basic pay of Rs 50,000 and with Dearness Allowance (DA) projected to reach 60% by the end of 2025 (up from the current ~55% with one more likely increment), salaries are expected to increase by at least 14% under the 8th Pay Commission. This growth at about 14% represents the lowest threshold seen across the last four Pay Commissions (including the current one)," the report said.
8th Pay Commission: When Will It Be Implemented?
The 8th Pay Commission was announced in January 2025. However, it has not been constituted yet. The central government will announce the terms or reference (ToR), members and chairman of the 8th CPC soon.
The Department of Expenditure (DEA), under the Ministry of Finance, has put forward a proposal to fill 35 positions in the 8th Pay Commission through deputation.
According to reports, the implementation of the 8th CPC is likely to be delayed as against the earlier expectation of January 1, 2026. The recommendations of the latest pay panel could be implemented in late 2026 or 2027.
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July 10, 2025, 13:07 IST
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