8th Pay Commission: Employee Bodies Propose Higher Annual Increment Rates

The 8th Pay Commission’s two-day consultations begin in Chennai today (Monday, September 7, 2026). In its two meetings, central government employee and pensioner bodies and other stakeholders based in Tamil Nadu will discuss issues related to pay, pension, employees’ working conditions, etc, with 8th Pay Commission officials. The Chennai meetings will be followed by Puducherry discussions on September 9, 2026.

Among all such 8th Pay Commission discussions that have taken place at various cities across India, one of the key demands that has been raised by employee and pensioner bodies is to increase the current annual increment rate of 3% for central government employees.

Employee and pensioner bodies in their memorandums submitted to the 8th Pay Commission have suggested annual increment rates in the range of 5%-7%. For example, the All India New Pension Scheme Employees’ Federation (AINPSEF) has recommended a 7% annual increment.

Others like the National Council of the Joint Consultative Machinery (NC-JCM), the main central government employee body, the All India Defence Employees' Federation (AIDEF) and the Federation of National Postal Organisations (FNPO) have suggested a 6% annual increment rate each. The Indian Railways' Technical Supervisors' Association (IRTSA) has suggested a 5% increment rate, but it also wants a fitment factor of up to 4.0.

Manjeet Singh Patel, president, AINPSEF, told ET Wealth Online that under the present conditions, when a fitment factor is applied to the salary of an employee in a new commission, the total salary barely doubles in 10 years even after applying the annual increment rate of 3% and dearness allowance (DA).

“We are recommending a 7% increment rate as it can double the salary in just 6-7 years. For low-level employees residing in Tier I cities, such a high increment will help them meet rising expenses,” says Patel.

Employee associations also believe that if the annual increment rate is high, employees don’t have to wait for 10 years to see a substantial raise in their payouts in a new pay commission.

But here, the big question is: can a system exist where employees can depend on a high increment rate, doing away with the fitment factor?

Or is a strong salary push in the form of the fitment factor necessary for all employees?

Let’s compare scenarios where employees get a fitment factor of 2.15 and the annual increment rate of 3% is retained, and when they don’t get the fitment factor benefit and depend on a 5%, 7% or 10% annual increment rate.

Assumptions for 8th Pay Commission salary estimates:

·Basic salary- Rs 30,000-Rs 40,000 (As per 7th Pay Commission)

·8th Pay Commission’s estimated fitment factor- 2.15

·Increment rates- 3%, 5%, 7% and 10%

However, these are just estimates. Revised salaries of central government employees will be known only after the 8th Pay Commission decides on the fitment factor and the annual increment rate.