Seventh Pay Commission hike notified: 10 things to know

THE Finance Ministry has notified the salary hike based on Seventh Pay Commission recommendations. This means lakhs of government employees will receive higher salaries likely from next month. The notification is dated July 25, 2016. About 1 crore employees and pensioners will benefit from the pay hike, effective from January 1, 2016. The recommendations cover 47 lakh Central government employees and 53 lakh pensioners. This includes 14 lakh serving employees and 18 lakh pensioners in defence forces.
The entry level pay has been raised to Rs 18,000 per month from current Rs 7,000 with effect from January 1, 2016, while the maximum pay, drawn by the Cabinet Secretary, has been fixed at Rs 2.5 lakh per month from current Rs 90,000. The notification provided for a consolidated monthly pay package of Rs 4.5 lakh for chairpersons of sector regulators and Rs 4 lakh for their members. These included Telecom Regulatory Authority of India, Central Electricity Regulatory Commission, Insurance Regulatory and Development Authority, Securities and Exchange Board of India, Competition Commission of India, Pension Fund Regulatory and Development Authority, Petroleum and Natural Gas Regulatory Board, Warehousing Development and Regulatory Authority, and Airports Economic Regulatory Authority of India.
The Pay Commission had recommended abolition of 53 out of 196 allowances that the government employees currently get and moderation in several others.
Here are the key highlights...
of the notification:
1) According to the pay new structure, the existing basic pay as on December 31, 2015, shall be multiplied by a factor of 2.57.
2) The arrears shall be paid during the financial year 2016-2017.
3) Entry-level pay will be raised to Rs 18,000 a month from the current Rs 7,000. The maximum pay has been fixed at Rs 2.5 lakh.
4) The  Seventh Pay Commission's recommendations  on  allowances  (except  DA) has been referred to  a committee, which will submit  its  report  within  four  months. All allowances will continue to be paid at existing rates in existing pay structure.
5) There shall be two dates for grant of increment namely, 1st January and 1st July of every year, instead of existing date of 1st July provided that an employee shall be entitled to only one annual increment either on 1st January or 1st July depending on the date of his appointment, promotion or grant of financial upgradation.
6) The increment in respect of an employee appointed or promoted or granted financial upgradation including upgradation under Modified Assured Career Progression Scheme (MACPS) during the period between the 2nd day of January and 1st day of July (both inclusive) shall be granted on 1st day of January and the increment in respect of an employee appointed or promoted or granted financial upgradation including upgradation under MACPS during the period between the 2nd day of July and 1st day of January (both inclusive) shall be granted on 1st day of July.
7) Mode of payment of arrears of pay: The arrears shall be paid during the Financial Year 2016-2017.
8) Recommendations  of  the  Commission  for  hike in  rates  of  monthly  contribution towards Central Government Employees Group Insurance Scheme (CGEGIS) for various categories of employees  has  not  been  accepted.  The existing rates of monthly contribution shall continue.
9) The  recommendations  of  the  seventh pay commission  relating  to  interest  bearing  advances  as  well  as interest free advances have been accepted with some exceptions.
10) Committees  will  be  set  up  by  Department  of  Personnel   to  examine individual,   post-specific and cadre-specific anomalies  arising   out   of   implementation   of   the recommendations of the Commission.