7th Pay Commission: How central government employees' monthly salary is calculated? How 7th CPC fitment factor will change DA, PF, Gratuity from July 2021

7th Pay Commission latest news: It's around five years since the Seventh Pay Commission or 7th CPC got cleared for the central government employees. However, after around five years of the 7th CPC inception, a central government employee's monthly salary has risen a lot, especially after the Dearness Allowance (DA) announcement after every six months, Travel Allowance (TA) rising in sync with the DA and other allowances too rising with the passage of time. Since, DA has been frozen from July 2020 to June 2021, the central government employees are wondering and calculating how much their salary will rise once the DA is restored.

7th CPC: Monthly salary calculation
The monthly salary of a central government employee under Seventh Pay Commission is calculated by multiplying one's basic salary by the 7th Pay Commission fitment factor, which is 2.57. If a central government employee's basic salary is Rs 18,000 per month, in that case, the central government servants monthly salary will be Rs 46,260 plus Dearness Allowance (DA), Travel Allowance (TA), House Rent Allowance and other allowance.

7th Pay Commission: Provident Fund, Gratuity
As per the 7th CPC rule, one's monthly contribution in one's PF account and gratuity contribution is also decided by the basic salary of the central government employee and the percentage of DA applied. For example, currently central government employees' DA is 17 per cent. In that case, if a central government servant's basic salary is Rs 18,000 then its monthly PF contribution will be 12 per cent of 117 per cent of Rs 18,000 i.e. Rs 2,527.20. Similarly, Gratuity will be calculated.

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How salary will change from July 2021
The center has announced that central government employees' DA will be restored from July 2021. That means, from 1st July 2021, central government employees' applicable DA will be 28 per cent (3 per cent for January to June 2020, 4 per cent for July to December 2020 and expected 4 per cent from Jan to June 2021). So, the DA will rise from 17 per cent to 28 per cent and one can easily calculate their monthly salary by calculating the new DA, PF and Gratuity contribution as done above.