8th Pay Commission Explained: Who Will Get the Hike and When Revised Salaries Are Likely to Be Paid

The formation of the 8th Central Pay Commission has ended months of speculation for lakhs of central government employees and pensioners, but key questions around eligibility, pay hikes, and timelines remain unanswered.

The Union government has formally constituted the commission and approved its Terms of Reference, tasking it with reviewing pay, allowances, and pensions of central government employees. The panel has been given 18 months to submit its report, after which the Cabinet will decide on implementation.

Who will benefit from the 8th Pay Commission?

The commission applies strictly to central government employees and pensioners, including family pensioners. All serving employees whose salaries are calculated under the Central Civil Services pay matrix fall within its scope. Importantly, retirees have been explicitly included, ensuring that pension revisions form a core part of the exercise.

However, state government employees are not automatically covered. While states may choose to adopt the recommendations later, either partially or fully, the decision rests solely with individual state governments.

Employees of public sector undertakings (PSUs), autonomous bodies, and statutory organisations will benefit only if their respective governing authorities decide to implement the revised pay structure.

Current status and timeline

With the commission now operational, the process has officially begun. The Finance Ministry has informed Parliament that funds will be arranged once the recommendations are accepted. At this stage, there has been no announcement on interim relief or merger of dearness allowance (DA) or dearness relief (DR) with basic pay.

When will revised salaries and pensions be paid?

Officially, the revised pay structure is expected to come into effect from January 1, 2026. However, based on previous pay commissions, actual salary credits typically happen several months after Cabinet approval, with arrears paid retrospectively. As a result, employees and pensioners are likely to see revised salaries and pensions reflected during FY 2026–27.

How much hike can employees expect?

While no official numbers have been released, early estimates suggest a 20–35 per cent increase, depending on pay level, allowances, and the final fitment factor. For context, the 6th Pay Commission resulted in a nearly 40 per cent hike, while the 7th Pay Commission led to a 23–25 per cent increase with a fitment factor of 2.57. Current projections for the 8th Pay Commission place the fitment factor between 2.4 and 3.0, subject to inflation and fiscal conditions.

What should employees do now?

For now, experts advise patience. With the commission operating within a fixed timeline, more clarity is expected through Cabinet decisions and upcoming Union Budgets. While the exact impact and implementation schedule remain uncertain, the government’s move confirms that pay and pension revisions are firmly on the policy roadmap.