7th Pay Commission: Calculate what you will get from July 1

Central government employees will be getting revised salaries under 7th Pay Commission from this month. 

On June 28, Union Cabinet meeting chaired by Prime Minister Narendra Modi approved the recommendations of the 7th Pay Commission with 34 modifications. The government said that the revised allowance will come into effect from July 1, 2017. This revision will affect more than 48 lakh central government employees. 

With new salary structure coming into play, it is important to understand the calculation part. 

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According to Cabinet Committee on Economic Affairs, as the House Rent Allowance (HRA) at the reduced rates was not be sufficient for employees falling in lower pay bracket, the cabinet decided that HRA will not be less than Rs 5400, Rs 3600 and Rs 1800 for X, Y and Z category of cities respectively.

However, HRA is subjected to change in two phases – when DA crosses 50%, HRA will be revised to 27%, 18% and 9% and when DA reaches 100%, HRA will be revised back to 30%, 20% and 10% respectively.

This will benefit more than 7.5 lakh employees belonging to Levels 1 to 3.

For most of the allowances that were retained, the 7th CPC recommended a raise commensurate with inflation as reflected in the rates of Dearness Allowance (DA). 

Accordingly, fully DA-indexed allowances such as Transport Allowance were not given any raise. Allowances not indexed to DA were raised by a factor of 2.25 and the partially indexed ones by a factor of 1.5. The quantum of allowances paid as a percentage of pay was rationalised by a factor of 0.8.

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As per the revised pay, the government has increased the minimum wage of the central government employees from Rs 7000 per month to Rs 18000 per month. 

The revised income of the employees under 9,300 to 34,800 pay band was increased. The pay band under which central government employees will be paid has been divided into four categories - from 4200, 4600, 4800 and 5400, which is further divided into 40 levels, a s reported by OneIndia.

Moreover, under the 5,200-20,200 pay band have been divided into five categories from Grade 1800 to 2800. This has further been divided into 40 levels.

The simplest way to calculate is here:

1. Take your basic salary as on january 1, 2016.
2. Considering the fitment factor is 2.57, multiply it with basic pay
3. Add all your allowances (HRA, TA, medical allowance according to the revised salary structure)
4. All of the above. 

Example: