8th Pay Commission 2026: Complete Guide to Salary Hike & Implementation

The 8th Pay Commission (8th CPC) is a pay revision commission constituted by the Government of India to review and recommend salary structures, allowances, and pension benefits for central government employees, defence personnel, and pensioners.

The Union Government officially approved the formation of the 8th Pay Commission on January 16, 2025. The commission replaces the 7th Pay Commission which concludes its tenure on December 31, 2025, with the new pay structure effective from January 1, 2026.

Pay Commissions are typically constituted every 10 years to ensure fair compensation that keeps pace with inflation and economic growth. The 7th CPC was implemented in 2016, making the 8th CPC expected around 2025-2026.

The 8th Pay Commission is anticipated to result in substantial salary increases for central government employees, with estimated hikes ranging from 30% to 34%.

Fitment Factor Projections

The fitment factor is a multiplier applied to existing basic pay to arrive at the revised basic pay. Various projections for the 8th CPC fitment factor include:

• Conservative estimate: Fitment factor of 2.28, leading to ~34.1% increase in minimum wage
• Moderate range: Fitment factor between 1.83 and 2.46
• Optimistic projection: Fitment factor of 2.28 to 2.86, potentially raising minimum basic pay from ₹18,000 to between ₹41,000 and ₹51,480

Historical Fitment Factor Comparison

Upon implementation of the 8th Pay Commission, both Dearness Allowance (DA) for employees and Dearness Relief (DR) for pensioners will reset to zero.

Key Points About DA in 8th CPC:

• DA is projected to reach 70% by January 2026
• This accumulated DA will be incorporated into the base salary for new calculations
• Post-implementation, DA/DR restarts from 0% and grows biannually based on inflation indices
• No DA Merger: It has been clarified that there are no plans to directly merge DA with basic pay

The recommendations of the 8th Pay Commission are expected to benefit:

• ~4.5 million central government employees, including Defence Services Personnel
• ~6.8 million pensioners across the country

Important Clarifications:

• Bank employees: Not covered. Their pay is revised under Indian Banks' Association (IBA) agreements
• State government employees: Not directly covered. However, states may introduce their own pay commissions (Assam has already established its own 8th Pay Commission)
• Private sector: Not applicable. Pay Commissions only cover government employees