8th Pay Commission: A simple guide to calculate your new salary

The 8th Pay Commission is set to bring substantial changes to the salary structure of government employees. A key highlight is the Fitment Factor, which will be used to calculate the revised pay scales, significantly increasing salaries. Let’s break down how this works in simple terms.

Step-by-Step Salary Calculation Process

Step 1: Understanding the Fitment Factor

The Fitment Factor is a multiplier applied to the current basic salary (under the 7th Pay Commission) to determine the new basic salary. For the 8th Pay Commission, the proposed Fitment Factor is 2.28.

Example:

A Level 1 employee with a current salary of ₹18,000 will have their salary calculated as:

₹18,000 × 2.28 = ₹40,944.

This means their new basic salary will round up to ₹41,000.

Step 2: Adding the Dearness Allowance (DA)

The Dearness Allowance (DA) helps counter inflation and will also apply to the new basic salary. By 2026, the DA is projected to reach 70%.

Example:

A Level 1 employee with a new basic salary of ₹40,944 will receive a DA of 70%:

70% of ₹40,944 = ₹28,661.

Total Salary = ₹40,944 + ₹28,661 = ₹69,605 (rounded to ₹69,600).

Step 3: Using the Pay Matrix

The Pay Matrix simplifies salary calculations by pre-calculating the revised salaries for each level.

Level 1: Salary increases from ₹18,000 to ₹41,000.

Level 13: Salary rises from ₹1,23,100 to ₹1,47,720.

Summary of the 8th Pay Commission Salary Calculation

Multiply your current salary by 2.28 to calculate your new basic salary.

Add the Dearness Allowance (DA), which is expected to reach 70%.

Use the Pay Matrix for pre-calculated figures for each level.

Significant Benefits for Employees

Starting January 1, 2026, government employees will enjoy substantial pay hikes. The minimum wage will increase from ₹18,000 to ₹41,000, ensuring improved financial security amid rising inflation.

By understanding how the Fitment Factor and DA work, employees can calculate their salaries effortlessly under the 8th Pay Commission, paving the way for greater financial stability and well-being.