7th Pay Commission Latest News – Minimum wage and Fitment formula

7th Pay Commission Latest News – Minimum wage and Fitment formula

The Staff side had demand of minimum wage of Rs 26000/- & fitment formula of 3.71 against 7th CPC recommendation of Rs 18000/- & fitment formula of 2.57.

7th Pay Commission Latest News – Confederation of Central Government Employees, Karnataka Branch analyses how 7th CPC minimum wage is fixed and why employees are on the losing side.

7th Pay Commission has adopted a formula for fixing the minimum wage and fitment formula in its recommendations. As per this recommendations Basic Pay in Central Government Service has been fixed as Rs. 18000 while highest pay has been fixed as Rs. 2,50,000. As far as existing employees are concerned, the a uniform multiplication factor of 2.57 has been arrived at which has to be multiplied with the existing basic pay of an employee to get the revised basic pay. However, Confederation of Central Government Employees reports that the prices for various essential commodities taken by the 7th Commission for arriving at minimum wage and fitment formula are on the lower side and consequently actual economic inflation in the past 10 years has not been factored in to the recommended 7th CPC pay and allowances.

The following is the analysis of Confederation of Central Government Employees and Workers, Karnataka Branch with regard to Minimum Wage and Fitment formula adopted by 7th Pay Commission.


Minimum wage and Fitment formula
Comrades,
The Staff side had demand of minimum wage of Rs 26000/- & fitment formula of 3.71. Against this the 7th CPC had recommended minimum wage of Rs 18000/- & fitment formula of 2.57. The 7th CPC recommendations has provided only at 14% wage hike at Group “C” level it is only ranging from Rs 2240/- to Rs 3500/- increase per month, and at Group “B” level ranging from Rs 4000/- to Rs 6500/- increase per month. After deductions & income tax the net increase will be just from Rs 500/- to Rs 3000/- only .
This increase is lowest by any pay commission, hence vast changes are required as the prices of essential commodities have gone up and also the inflation rate has gone up.

There are various reports on 7th Central Pay commission on the media reports on minimum wage of Rs 21000/- & fitment formula of 3.00, (which is at 34% wage hike against the 14% wage hike recommended by the 7thCPC).

The Empowered committee of Secretaries have not finalised any such minimum wage and fitment formula, the meeting is scheduled on 11th June 2016.

Please go through minimum wage as on 1/1/2016 using the prices as on 1/7/2015 of the Director of Economic & statics , Ministry of Agriculture and Farmers Welfare, Government of India, New Delhi.
Sources website : http://rpms.dacnet.nic.in/QueryReport.aspx

Minimum Wage as per Government  Prices  as on 1/7/2015
Rice  fine/Wheat	42.75	32.45	1387.2375
Dal / Pulses	7.2	112.96	813.20
Raw Vegetables	9	112.96	1016.64
Green Vegetables*	11.25	26.78	301.275
Other Vegetables*	6.75	50	337.5
Fruits	10.8	45	486
Milk Dairy	18	97.92	1762.56
Sugar	5	41.85	209.25
Edible Oil	3.6	142.42	512.712
Fish	2.5	231.67	579.175
Meat Mutton	5	401.95	2009.75
Egg	90	4.68	421.2
Detergents*	1	250	250
Clothes	5.5	279.34	1536.37
Total			10809.6695
Housing @ 7.5%			810.65
Miscellaneous @ 20%			2161.93
Total			13782.2495
Additional @ 25%			3445
			17227.2495
Grand Total –
Minimum pay for unskilled worker in the erstwhile Group D			17227
Additional @ 25% for Group “C”			4306.75
Minimum pay for skilled worker in the erstwhile Group “C”			21533.75
Rounded off to Rs 22000/-
Add 6%  for DA = 125%  difference			646
Actual Minimum wage as on 1/1/2016			22179.75

We should add 10% for difference between retail price and Government rates.  It is clear that we should get minimum wage of Rs 24500 and fitment formula is 24500/ 7000 is 3.40 that is 50% wage hike .
The 7th CPC had provided wrong prices for example

Rice/Wheat Rs 25.93 per kg Dal (Toor/Urad/Moong) Rs 97.84 per kg.

If correct prices were adopted by the 7th CPC and correct methodology is adopted we would have got better minimum wage and fitment formula,

Comrades it is the time to struggle, we should educate the members and prepare for struggle, so that we should get at least 50 % wage hike without allowances, as allowances are not taken into pension benefit.
Only struggle will get us benefit. Please don’t believe on rumours. Now it is now or never.  Serve strike notice on 9th June 2016.

Comradely yours

(P.S.Prasad)

General Secretary

Source : http://karnatakacoc.blogspot.in/

7th Pay Commission Rumours – Discarding Grade Pay system – Will it be beneficial ?

7th Pay Commission Rumours – Discarding Grade Pay system – Will it be beneficial ?

A study on difference in Fitment benefit for 7th Pay Commission Pay Fixation in the case of principles of 5th CPC Pay fixation is adopted in lieu of Fitment Benefit in the form of Grade Pay System evolved by 6th CPC

Fitment benefit in the form of Grade Pay provided by 6th CPC was computed based on highest pre-revised pay in each of the pre-revised Pay Scale – Fitment benefit advocated by previous pay commisions were reckoned with Pre-revised basic Pay drawn on the effective date of CPC

While Central Government Employees keep their fingers crossed after 7th Pay Commission finished all the interaction sessions with the Employees Federations and started finalising its report to be submitted to Govt, many surmises and speculations have already started filling the air through Internet and through word of mouth about possible 7th CPC pay fixation methods.

Some of those 7th Pay Commission rumours are as follows

• There will be no running Pay band and Grade Pay System
• The Minimum Pay will be Rs. 21000
• The uniform multiplication factor for arriving revised pay will be 2.86
• The Criteria for retirement age will be either completion of 33 Years of service or at the age of 60 Years whichever is earlier.

Interestingly, these rumours are spread out this time carry the tags as “inside information provided by Employees federations which participated in the 7th Pay Commission meetings”. The very character of a rumour is, it may be true or false. God only knows.

Among these, the unconfirmed news that 7th Pay Commission is to discard Pay Band – Grade Pay System may be affecting the Pay Structure of Central Government Employees very much if it is true.
In fact this is an off-shoot of proposal moot out by Confederation of Central Government Employees and
Workers in its reply to 7th Pay Commission Questionnaire

In this background, we made an analysis as to whether discarding of Grade Pay System would be beneficial to Central Government Employees.

As per the proposal of Confederation, the Pay Band and Grade Pay system evolved by the 6th CPC brought about innumerable anomalies and the same has to be replaced by the Pay scale structure, which was in vogue prior to the implementation of the 6th CPC.

What was Pay Scale Structure prior to 6th CPC ?  How fixation pay was made in that pay scale ?

Obviously, Pay Scale Structure contemplated by Confederation is 5th Pay Commission Pay Structure which is the Pay Structure prior to 6th CPC pay Structure.
Now, let us have a look at the 5th CPC Pay Structure and how pre-revised 4th CPC Pay was revised and fit into the same.

5th Pay Commission Pay fixation Method :

As per Central Civil Services (Revised Pay) Rules 1997 which was notified by Ministry of Finance for implementation of 5th Pay Commission Report, Revised Pay Scales against 4th CPC pay scales are as follows

4th CPC Pay scales	5th CPC pay scales
750-12-870-14-940	S-1	2550-55-2660-60-3200
775-12-871-12-1025	S-2	2610-60-3150-65-3540
775-12871-14-955-15-1030-20-1150	S-2A	2610-60-2910-65-3300-70-4000
800-15-1010-20-1150	S-3	2650-65-3300-70-4000
825-15-900-20-1200	S-4	2750-70-3800-75-4400
950-20-1150-25-1400/950-20-1150-25-1500/1150-25-1500	S-5	3050-75-3950-80-4590
975-25-1150-30-1540/975-25-1150-30-1660	S-6	3200-85-4900
1200-30-1440-30-1800/1200-30-1560-40-2040/1320-30-1560-40-2040	S-7	4000-100-6000
1350-30-1440-40-1800-50-2200/1400-40-1800-50-2300	S-8	4500-125-7000
1400-40-1600-50-2300-60-2600/1600-50-2300-60-2660	S-9	5000-150-8000
1640-60-2600-75-2900	S-10	5500-175-9000
2000-60-2120	S-11	6500-200-6900
2000-60-2300-75-3200/2000-60-2300-75-3200-3500	S-12	6500-200-10500
2375-75-3200-100-3500 / 2375-75-3200-100-3500-125-3750	S-13	7450-225-11500
2500-4000	S-14	7500-250-12000
2200-75-2800-100-4000/2300-100-2800	S-15	8000-275-13500
2200-75-2800-100-4000	NEW SCALE	8000-275-13500(Group A Entry)
2630/- FIXED	S-16	9000
2630-75-2780	S-17	9000-275-9550
3150-100-3350	S-18	10325-325-10975
3000-125-3625/3000-100-3500-125-4500/ 3000-100-3500-125-5000	S-19	10000-325-15200
3200-100-3700-125-4700	S-20	10650-325-15850
3700-150-4450/3700-125-4700-150-5000	S-21	12000-375-16500
3950-125-4700-150-5000	S-22	12750-375-16500
3700-125-4950-150-5700	S-23	12000-375-18000
4100-125-4850-150-5300/4500-150-5700	S-24	14300-400-18300
4800-150-5700	S-25	15100-400-18300
5100-150-5700/5100-150-6150/5100-150-5700-200-6300	S-26	16400-450-20000
5100-150-6300-200-6700	S-27	16400-450-20900
4500-150-5700-200-7300	S-28	14300-450-22400
5900-200-6700/5900-200-7300	S-29	18400-500-22400
7300-100-7600	S-30	22400-525-24500
7300-200-7500-250-8000	S-31	22400-600-26000
7600/-FIXED /7600-100-8000	S-32	24050-650-26000
8000/- FIXED	S-33	26000(FIXED)
9000/- FIXED	S-34	30000(FIXED)

Further, 5th CPC revised pay of Central Government Employees was worked out by adding DA as on 01.01.1996, two installments of Interim Relief (IR-1 and IR-2) and 40% of pre-revised basic pay with Pre-Revised Basic pay drawn as on 01.01.1996. Then resultant revised basic pay was stepped up to nearest incremented pay in the revised 5th CPC pay scale against the existing 4th CPC pay scale in which the pay was drawn. The following illustration would provide clear cut idea about 5th Pay Commission Pay fixation method

Illustration for 5th Pay Commission Pay fixation

Existing 4th CPC pay scale	Rs. 1640-60-2600-75-2900
Revised 5th CPC pay scale	Rs. 5500-175-9000
Pre-Revised Basic Pay	Rs. 2360
D.A as on 01.01.1996 @ 148%	Rs. 3493
IR-1	Rs. 100
IR-2	Rs. 236
Add 40% of pre-revised B.P	Rs. 944
Total	Rs. 7133
Nearest incremented pay in revised 5th CPC pay scale —-A	Rs, 7250
If one increment is ensured in the revised pay scale for every three increments in the pre-revised pay scale, the revised basic will be —- B	Rs. 6250
5th CPC revised Basic Pay as on 01.01.1996 (A or B whichever is higher)	Rs. 7250

From the above it could be found that fitment benefit of 40% is calculated using the pre-revised basic pay received by an employee as on 01.01.1997. On the contrary, in the case of fitment benefit allowed by 6th Pay Commission in the form of Grade Pay, it has been calculated at 40% of highest Pay in each of 5th CPC Pre-Revised pay scale.

6th Pay Commission Pay Band and Grade Pay hierarchy

5th CPC Pay Scales		6th CPC Pay Band and Grade Pay
GRADE	SCALE	Pay Band		Grade Pay
S-1	2550-55-2660-60-3200	-1S	4440-7440	1300
S-2	2610-60-3150-65-3540	-1S	4440-7440	1400
S-2A	2610-60-2910-65-3300-70-4000	-1S	4440-7440	1600
S-3	2650-65-3300-70-4000	-1S	4440-7440	1650
S-4	2750-70-3800-75-4400	PB-1	5200-20200	1800
S-5	3050-75-3950-80-4590	PB-1	5200-20200	1900
S-6	3200-85-4900	PB-1	5200-20200	2000
S-7	4000-100-6000	PB-1	5200-20200	2400
S-8	4500-125-7000	PB-1	5200-20200	2800
S-9	5000-150-8000	PB-2	9300-34800	4200
S-10	5500-175-9000	PB-2	9300-34800	4200
S-11	6500-200-6900	PB-2	9300-34800	4200
S-12	6500-200-10500	PB-2	9300-34800	4200
S-13	7450-225-11500	PB-2	9300-34800	4600
S-14	7500-250-12000	PB-2	9300-34800	4800
S-15	8000-275-13500	PB-2	9300-34800	5400
NEW SCALE	8000-275-13500(Group A Entry)	PB-3	15600-39100	5400
S-16	9000	PB-3	15600-39100	5400
S-17	9000-275-9550	PB-3	15600-39100	5400
S-18	10325-325-10975	PB-3	15600-39100	6600
S-19	10000-325-15200	PB-3	15600-39100	6600
S-20	10650-325-15850	PB-3	15600-39100	6600
S-21	12000-375-16500	PB-3	15600-39100	7600
S-22	12750-375-16500	PB-3	15600-39100	7600
S-23	12000-375-18000	PB-3	15600-39100	7600
S-24	14300-400-18300	PB-4	37400-67000	8700
S-25	15100-400-18300	PB-4	37400-67000	8700
S-26	16400-450-20000	PB-4	37400-67000	8900
S-27	16400-450-20900	PB-4	37400-67000	8900
S-28	14300-450-22400	PB-4	37400-67000	10000
S-29	18400-500-22400	PB-4	37400-67000	10000
S-30	22400-525-24500	PB-4	37400-67000	12000
S-31	22400-600-26000	HAG+SCALE	75500-80000	NIL
S-32	24050-650-26000	HAG+SCALE	75500-80000	NIL
S-33	26000(FIXED)	APEX SCALE	80000(FIXED)	NIL
S-34	30000(FIXED)	CAB. SEC.	90000(FIXED)	NIL

We are of the view that if the 7th CPC fitment benefit is calculated on the basis of existing pre-revised pay as in the case of 5th CPC then revised 7th CPC pay would be lesser than the revised 7th CPC Pay calculated by adopting the methods 6th CPC, in which grade pay (fitment benefit) has been arrived at on the basis of highest pay in the pre-revised pay Scale.

At the same time it may not be viable to arrive 7th CPC fitment benefit on the basis of highest Pay in each of Pay Band as 6th CPC Pay Band Structure has been designed in such a way that each of the Pay band accommodates many 5th CPC Pre-Revised Pay Scales

However, even after discarding Grade pay System, if the fitment benefit for 7th Pay Commission Pay revision is provided on the basis of highest pay in the fitment table provided vide O.M 1/1/2008-IC dated 30.08.2008 for the each of the 5th CPC Pre-Revised Pay Scale, then it would be Pay wise beneficial to Central Government Employees.

We invite valuable opinion of readers in the form of comments to this article so that pay fixation method beneficial to CG Employees community can be highlighted

Source: gconnect