Overview

• The Terms of Reference (ToR) for the 8th Central Pay Commission are likely to be approved shortly, marking a significant step toward its implementation.
• The commission, expected to revise salaries, pensions, and allowances, was approved in January 2024 but has faced delays in setting up the panel and finalizing its framework.
• Employee unions are pushing for demands such as a revised fitment factor, interim relief of 20%, and recalculation of minimum wages to account for larger family units.
• Level 1 government employees may see a potential 40% net salary hike, though the proposed fitment factor of 1.92 is lower than the previous 2.57.
• While implementation is slated for January 1, 2026, administrative delays could push the timeline into early 2027.