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8th Pay Commission Update: The work of the 8th Pay Commission has now reached a very important juncture. After taking suggestions from employees, pensioners and other stakeholders across the country, the Commission is now engaged in discussions and meetings that will decide the future of salaries, pensions and allowances of approximately one crore people.

The recommendations of this commission are going to have a direct impact on about 50 lakh central employees and about 65 lakh pensioners including retired defense forces personnel. Although there is still some time for the final report to come, but the employee unions have already put forward some of their big and important demands before the Commission. The biggest demand among these is to completely change the existing pay matrix.

A look at the formation of the commission

The 8th Central Pay Commission was constituted on 3 November 2025 under the chairmanship of former Supreme Court judge, Justice Ranjana Prakash Desai. It also includes former IAS officer Pankaj Jain as member-secretary and Professor Pulak Ghosh, member of the Prime Minister’s Economic Advisory Council.

Why is the demand for merging pay scales gaining momentum?

The biggest and attention-grabbing proposal that has come from the employee organizations is to merge some of the existing pay levels.

The union suggests that Levels 2 and 3, Levels 4 and 5, Levels 7 and 8, and Levels 9 and 10 be merged into one. Their argument is that the employees working in these grades often do similar work and there is not much difference in their salaries, yet they have been placed in different levels. Over time, this difference creates dissatisfaction among employees and affects their morale.

Additionally, the union has advocated a one-time upgrade to existing Level 5 employees by directly merging them into Level 6. He says that thousands of Group C employees in departments like Central Secretariat, Defence, Railways and Postal Services are stuck at Level 5 for years, due to which their career is not able to progress.

Big demands of employee unions

The National Council-Joint Consultative Machinery (NC-JCM), one of the largest organizations of central employees, has presented its views very strongly before the Commission.

• The union has demanded that the minimum basic salary should be increased to Rs 69,000.
• At present the annual increment is 3%, which has been demanded to be increased to 6%.
• Along with simplifying the salary structure, it has been said to add allowances to house and utility (electricity, water etc.), so that amidst rising inflation, there is not much burden on the pockets of the employees and their purchasing power remains intact.
• NC-JCM has also appealed to the government to simplify promotion policies, so that employees are promoted on time and they do not remain stuck on the same post for a long time.

Some more important facilities which are worth keeping an eye on

Apart from salaries and pensions, employee organizations have also recommended addressing day-to-day service issues, such as:

• The process of withdrawing money from Provident Fund (PF) should be easy.
• Medical reimbursement claims (refund of treatment expenses) should be settled expeditiously.
• Better life insurance coverage for employees and pensioners.
• Paper work and processes to income tax should be simplified.

Round of meetings continue across the country

The Commission had closed the first round of taking suggestions from the public and employees on June 15. However, the work of collecting data from different ministries and departments will continue till July 31. Since the month of March, members of the Commission have been visiting different states and meeting employee organizations and pensioners’ groups directly.

Representatives of big departments like Railways and Defense are also participating in these discussions, and these discussions will later become the basis for deciding the new salary structure and pension formula.

So when will these recommendations be implemented?

Generally, the Pay Commission takes about 18 months to submit its report after its formation. If everything goes according to schedule, the commission can prepare its recommendations between February and April 2027.

But, past experience shows that it takes a lot of time to submit the recommendations and implement them on the ground. Even during the previous pay commissions, it took 2 to 3 years for the new salary structure to be fully implemented after the recommendations were made. From this perspective, even if the report comes in 2027, it may take time till 2029 or 2030 for its full benefits to reach the pockets of the employees.

At present, the Commission is listening to all the parties. Now it remains to be seen what decision will be taken in favor of one crore employees and elderly pensioners for the coming decade.

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