The 7th Pay Commission report recommendations have been cleared today by the Cabinet. Earlier in its report, in November last year, the commission itself had recommended 14.27 per cent hike in basic pay at junior levels, the lowest in 70 years.

Here are the 7th Pay Commission report highlights:

1. Recommended Date of implementation: 01.01.2016

2. Minimum Pay – Calculator: Based on the Aykroyd formula, the minimum pay in government is recommended to be set at Rs 18,000 per month.

3. Maximum Pay: Rs 2,25,000 per month for Apex Scale and Rs 2,50,000 per month for Cabinet Secretary and others presently at the same pay level.

4. Financial Implications:

a) The total financial impact in the FY 2016-17 is likely to be Rs 1,02,100 crore, over the expenditure as per the ‘Business As Usual’ scenario. Of this, the increase in pay would be Rs 39,100 crore, increase in allowances would be Rs 29,300 crore and increase in pension would be Rs 33,700 crore.

b) Out of the total financial impact of Rs 1,02,100 crore, Rs 73,650 crore will be borne by the General Budget and Rs 28,450 crore by the Railway Budget.

c) In percentage terms the overall increase in pay & allowances and pensions over the „Business As Usual‟ scenario will be 23.55 percent. Within this, the increase in pay will be 16 percent, increase in allowances will be 63 percent, and increase in pension would be 24 percent.

d) The total impact of the Commission‟s recommendations are expected to entail an increase of 0.65 percentage points in the ratio of expenditure on (Pay+Allowances+ Pension) to GDP compared to 0.77 percent in case of VI CPC.

5. New Pay Structure: Considering the issues raised regarding the Grade Pay structure and with a view to bring in greater transparency, the present system of pay bands and grade pay has been dispensed with and a new pay matrix has been designed. Grade Pay has been subsumed in the pay matrix. The status of the employee, hitherto determined by grade pay, will now be determined by the level in the pay matrix.

6. Fitment: A fitment factor of 2.57 is being proposed to be applied uniformly for all employees.

7. Annual Increment: The rate of annual increment is being retained at 3 percent.

8. Modified Assured Career Progression (MACP):

a. Performance benchmarks for MACP have been made more stringent from “Good” to “Very Good”.
b. The Commission has also proposed that annual increments not be granted in the case of those employees who are not able to meet the benchmark either for MACP or for a regular promotion in the first 20 years of their service.
c. No other changes in MACP recommended.

9. Military Service Pay (MSP): The Military Service Pay, which is a compensation for the various aspects of military service, will be admissible to the Defence forces personnel only. As before, Military Service Pay will be payable to all ranks up to and inclusive of Brigadiers and their equivalents. The current MSP per month and the revised rates recommended are as follows:

7th Pay Commission Report

10. Short Service Commissioned Officers: Short Service Commissioned Officers will be allowed to exit the Armed Forces at any point in time between 7 and 10 years of service, with a terminal gratuity equivalent of 10.5 months of reckonable emoluments. They will further be entitled to a fully funded one year Executive Programme or a M.Tech. programme at a premier Institute.

11. Lateral Entry/Settlement: The Commission is recommending a revised formulation for lateral entry/resettlement of defence forces personnel which keeps in view the specific requirements of organization to which such personnel will be absorbed. For lateral entry into CAPFs an attractive severance package has been recommended.

12. Headquarters/Field Parity: Parity between field and headquarters staff recommended for similar functionaries e.g Assistants and Stenos.

13. Cadre Review: Systemic change in the process of Cadre Review for Group A officers recommended.

14. Allowances: The 7th Pay Commission has recommended abolishing 52 allowances altogether. Another 36 allowances have been abolished as separate identities, but subsumed either in an existing allowance or in newly proposed allowances. Allowances relating to Risk and Hardship will be governed by the proposed Risk and Hardship Matrix.

a. Risk and Hardship Allowance: Allowances relating to Risk and Hardship will be governed by the newly proposed nine-cell Risk and Hardship Matrix, with one extra cell at the top, viz., RH-Max to include Siachen Allowance.

The current Siachen Allowance per month and the revised rates recommended are as follows:

7th Pay Commission Table

Present		Proposed
i.	Service Officers	Rs 21,000	Rs 31,500
iii.	JCO/ORs	Rs 14,000	Rs 21,000

This would be the ceiling for risk/hardship allowances and there would be no individual RHA with an amount higher than this allowance.

b. House Rent Allowance: Since the Basic Pay has been revised upwards, the Commission recommends that HRA be paid at the rate of 24 percent, 16 percent and 8 percent of the new Basic Pay for Class X, Y and Z cities respectively. The Commission also recommends that the rate of HRA will be revised to 27 percent, 18 percent and 9 percent respectively when DA crosses 50 percent, and further revised to 30 percent, 20 percent and 10 percent when DA crosses 100 percent.

c. In the case of PBORs of Defence, CAPFs and Indian Coast Guard compensation for housing is presently limited to the authorised married establishment hence many users are being deprived. The HRA coverage has now been expanded to cover all.

d. Any allowance not mentioned in the report shall cease to exist.

e. Emphasis has been placed on simplifying the process of claiming allowances.

15. Advances:

a. All non-interest bearing Advances have been abolished.

b. Regarding interest-bearing Advances, only Personal Computer Advance and House Building Advance (HBA) have been retained. HBA ceiling has been increased to Rs 25 lakhs from the present Rs 7.5 lakhs.

16. Central Government Employees Group Insurance Scheme (CGEGIS):  The Rates of contribution as also the insurance coverage under the CGEGIS have remained unchanged for long. They have now been enhanced suitably. The following rates of CGEGIS are recommended:

7th Pay Commission Table

17. Medical Facilities:

a. Introduction of a Health Insurance Scheme for Central Government employees and pensioners has been recommended.

b. Meanwhile, for the benefit of pensioners residing outside the CGHS areas, CGHS should empanel those hospitals which are already empanelled under CS (MA)/ECHS for catering to the medical requirement of these pensioners on a cashless basis.

c. All postal pensioners should be covered under CGHS. All postal dispensaries should be merged with CGHS.

18. Pension: The Commission recommends a revised pension formulation for civil employees including CAPF personnel as well as for Defence personnel, who have retired before 01.01.2016. This formulation will bring about parity between past pensioners and current retirees for the same length of service in the pay scale at the time of retirement.

The past pensioners shall first be fixed in the Pay Matrix being recommended by the Commission on the basis of Pay Band and Grade Pay at which they retired, at the minimum of the corresponding level in the pay matrix.
This amount shall be raised to arrive at the notional pay of retirees, by adding number of increments he/she had earned in that level while in service at the rate of 3 percent.
In the case of defence forces personnel this amount will include Military Service Pay as admissible.

Fifty percent of the total amount so arrived at shall be the new pension.

An alternative calculation will be carried out, which will be a multiple of 2.57 times of the current basic pension.
The pensioner will get the higher of the two.

The financial impact of the recommendations of this Commission will be reflected through increases in expenditure on Pay, Allowances and on Pension. The likely quantum of increase on account of each of these is summarised below:

The total financial impact in the FY 2016-17 is likely to be Rs 1,02,100 crore, an increase of nearly 23.55 percent over the Business As Usual scenario. Based on the current trend, the total expenditure on Pay (including DA, but excluding other allowances), during the year 2016-17, without factoring in the recommendations being made by this Commission, is expected to be Rs 2,44,300 crore. After implementation of the recommendations of the VII CPC, this is likely to rise to Rs 2,83,400 crore, reflecting an increase of Rs 39,100 crore (16.00%).

19. Gratuity: Enhancement in the ceiling of gratuity from the existing Rs 10 lakh to Rs 20 lakh. The ceiling on gratuity may be raised by 25 percent whenever DA rises by 50 percent.

20. Disability Pension for Armed Forces: The Commission is recommending reverting to a slab based system for disability element, instead of existing percentile based disability pension regime.

21. Ex-gratia Lump sum Compensation to Next of Kin: The Commission is recommending the revision of rates of lump sum compensation for next of kin (NOK) in case of death arising in various circumstances relating to performance of duties, to be applied uniformly for the defence forces personnel and civilians including CAPF personnel.

22. Martyr Status for CAPF Personnel: The Commission is of the view that in case of death in the line of duty, the force personnel of CAPFs should be accorded martyr status, at par with the defence forces personnel.

23. New Pension System: The Commission received many grievances relating to NPS. It has recommended a number of steps to improve the functioning of NPS. It has also recommended establishment of a strong grievance redressal mechanism.

24. Regulatory Bodies: The Commission has recommended a consolidated pay package of Rs 4,50,000 and Rs 4,00,000 per month for Chairpersons and Members respectively of select Regulatory bodies. In case of retired government servants, their pension will not be deducted from their consolidated pay. The consolidated pay package will be raised by 25 percent as and when Dearness Allowance goes up by 50 percent. For Members of the remaining Regulatory bodies normal replacement pay has been recommended.

25. Performance Related Pay: The Commission has recommended introduction of the Performance Related Pay (PRP) for all categories of Central Government employees, based on quality Results Framework Documents, reformed Annual Performance Appraisal Reports and some other broad Guidelines. The Commission has also recommended that the PRP should subsume the existing Bonus schemes.
26. There are few recommendations of the Commission where there was no unanimity of view and these are as follows:

i. The Edge: An edge is presently accordeded to the Indian Administrative Service (IAS) and the Indian Foreign Service (IFS) at three promotion stages from Senior Time Scale (STS), to the Junior Administrative Grade (JAG) and the NFSG. is recommended by the Chairman, to be extended to the Indian Police Service (IPS) and Indian Forest Service (IFoS).
Vivek Rae, Member is of the view that financial edge is justified only for the IAS and IFS. Dr. Rathin Roy, Member is of the view that the financial edge accorded to the IAS and IFS should be removed.

ii. Empanelment: The Chairman and Dr. Rathin Roy, Member, recommend that All India Service officers and Central Services Group A officers who have completed 17 years of service should be eligible for empanelment under the Central Staffing Scheme and there should not be “two year edge”, vis-à-vis the IAS. Shri Vivek Rae, Member, has not agreed with this view and has recommended review of the Central Staffing Scheme guidelines.

iii. Non Functional Upgradation for Organised Group ‘A’ Services: The Chairman is of the view that NFU availed by all the organised Group `A‟ Services should be allowed to continue and be extended to all officers in the CAPFs, Indian Coast Guard and the Defence forces. NFU should henceforth be based on the respective residency periods in the preceding substantive grade. Shri Vivek Rae, Member and Dr. Rathin Roy, Member, have favoured abolition of NFU at SAG and HAG level.

iv. Superannuation: Chairman and Dr. Rathin Roy, Member, recommend the age of superannuation for all CAPF personnel should be 60 years uniformly. Shri Vivek Rae, Member, has not agreed with this recommendation and has endorsed the stand of the Ministry of Home Affairs.

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9.2.1 Presently Central Government offices observe a five-day week which results in 104 holidays every year on account of weekends. In addition, there are three National Holidays, fourteen Gazetted Holidays and two Restricted Holidays. Further, civilian government employees are entitled to 8 days’ Casual Leave, 20 days’ Half Pay Leave (commutable to Medical Leave) and 30 days’ Earned Leave. Besides the above, quite a few other types of leave are admissible.

 9.2.2 The following paragraphs bring out, in alphabetical order, the different kinds of holidays and leave admissible, demands received (if any) and views of the Commission on each one of them. Unless otherwise stated, the existing terms and conditions regulating these holidays and leave shall remain unchanged.

Casual Leave (CL)

9.2.3 Casual Leave is granted to enable a government servant to attend to sudden/unforeseen needs/tasks. Presently 8 days CL is normally granted to a Central Government employee per calendar year. The number goes up to 10 days for Industrial Workers, 20 days for Defence Officers and 30 days for Defence PBORs. Certain other categories of staff, particularly in the Railways, are granted CL ranging from 11 to 13 days in a year. Demands have been made to increase the number of CL to 15 days for Industrial Workers and 12 days for other employees. CAPFs have also sought parity with defence forces in matters of Casual Leave.

 Analysis and Recommendations

9.2.4 Regarding the number of Casual Leave, the Commission is of the view that the present system is working well and need not be altered. As far as the case of CAPFs for parity with defence forces is concerned, the Commission notes that CAPFs are essentially civilian forces and their service conditions are different from defence forces. Hence parity in terms of number of casual leave cannot be considered. To sum up, status quo is recommended.

Child Adoption Leave

9.2.5 This leave is granted to female employees, with fewer than two surviving children on valid adoption of a child below the age of one year, for a period of 135 days immediately after the date of valid adoption.

 Analysis and Recommendations

9.2.6 No demands have been received regarding this leave. Accordingly, status quo may be maintained.

Child Care Leave (CCL)

9.2.7 Child Care Leave (CCL) is granted to women employees for a maximum period of two years (i.e., 730 days) during their entire service for taking care of their minor children (up to eighteen years of age). There are several demands relating to CCL which include converting the same into “family care” leave, extending the facility to male parents and many representations stressing that it should be extended at least to single male parents. Suggestions have also been received that in cases where the child is differently abled, the clause stipulating that the child should be minor, should be done away with. Single mothers have highlighted their unique problems and requested the Commission for liberalising the grant of CCL. Interestingly, representations have also been made for discontinuance of the CCL, primarily on the grounds that it disrupts office working and also because it promotes gender discrimination.

 Analysis and Recommendations

9.2.8 When CCL was first introduced by the VI CPC it generated considerable interest as it represented a positive measure benefiting women employees. It also took a while to stabilise and it is seen that as many as five amendments/clarifications were issued within a short period of time. As it stands, it is meant for women employees “for taking care of up to two children whether for rearing the children or looking after their needs like examination, sickness etc.” It is treated akin to Earned Leave and is sanctioned as such. It may not, however, be granted in more than three spells in a calendar year.

9.2.9 In the first two years of its implementation the experience was that women employees tended to treat this as Casual Leave or an extension of the same, and the resultant frequent absences caused disruptions at work. To address this, in September 2010, a clarification was issued stipulating that CCL may not be granted in more than three spells in a calendar year and also that it may not be granted for less than 15 days at a time. However, the latter stipulation was subsequently withdrawn and as per the latest clarification issued on 5 June, 2014 the government has decided to remove the requirement of minimum period of 15 days CCL. It has been brought to the notice of the Commission that the capping of maximum three spells in a calendar year has, to some extent, addressed the problems relating to disruption of work. Notwithstanding that, in the course of discussions with various stakeholders, the sense that has come across is that what was introduced as a welfare measure to help employees in times of need, is seen as a benefit that has to be availed simply because it exists. There is, therefore, a palpable need to bring in some inhibiting feature so as to ensure that only genuinely affected employees avail of this scheme. Towards this end the Commission recommends that CCL should be granted at 100 percent of the salary for the first 365 days, but at 80 percent of the salary for the next 365 days. In making this recommendation the Commission has also kept in mind the fact the concept of a paid (whether 100% or 80%) leave solely for child care for a period of two years, is a liberal measure unmatched anywhere else.

9.2.10 The Commission notes that in the event a male employee is single, the onus of rearing and nurturing the children falls squarely on his shoulders. Hence extension of CCL to single male parents is recommended. Moreover, the Commission recognizes the additional responsibility on the shoulders of employees who are single mothers. Accordingly, it is recommended that for such employees, the conditionality of three spells in a calendar year should be relaxed to six spells in a calendar year.

Commuted Leave

9.2.11 Presently, Commuted Leave not exceeding half the amount of half-pay leave due can be taken on medical certificate. A demands have been made to do away with the need for medical certificate.

 Analysis and Recommendations

9.2.12 The Commission does not find merit in the demand. Status Quo is recommended.

Earned Leave (EL) or Leave on Average Pay (LAP)

9.2.13 Presently 30 days EL per annum is granted to Civilian employees and 60 days to Defence personnel. EL can be accumulated up to 300 days in addition to the number of days for which encashment has been allowed along with LTC. Suggestions have been made to increase the accumulation to 450 days, allow encashment of 50 percent of the accumulated EL after 20 years of service and delink encashment of leave from LTC. A novel concept of “gifting” has been put forward, wherein employee should be allowed to ‘gift’ certain number of days of leave to one’s spouse or one’s colleague. “Vacational” staff like teachers, principals, etc. have demanded restoration of 10 days EL, which was changed to 20 days Half Pay Leave by VI CPC.

 Analysis and Recommendations

9.2.14 In many organizations, employees are encouraged to take leave on the premise that it revitalizes them and is beneficial for the organization in the long run. Such a system is not prevalent in the government sector in India, but substituting leave with cash is also not desirable. Hence, no change in encashment guidelines is recommended.

9.2.15 The Commission recognizes that Earned Leave is, as the name suggests, earned by an employee through the services rendered. Hence, it is personal to the employee and the concept of “gifting” cannot be considered.

9.2.16 The demand of “Vacational” staff can, however, be agreed to. Hence, it is recommended that “Vacational” staff be granted 10 days EL in place of 20 days Half Pay Leave. Other than this no other change is recommended.

Extra Ordinary Leave (EOL)

9.2.17 EOL is granted to a government servant when no other leave is admissible or when other leave is admissible, but the government servant applies in writing for extraordinary leave. This leave is neither debited to leave account nor is any leave salary paid. No demands have been received regarding this leave. Accordingly, status quo may be maintained

Furlough Leave

9.2.18 This leave is admissible only to defence officers for up to 60 days. It can be availed at half pay, once in a cycle of three calendar years. No demands have been received regarding this leave. However, the Commission is of the view that Furlough Leave is a legacy of the pre- Independence era. Since defence officers are already entitled to double the Earned Leave and more than double the Casual Leave available to civilian employees, there is no justification for continuation of Furlough Leave. Hence, it is recommended that Furlough Leave be abolished.

Gazetted and Restricted Holidays

9.2.19 Besides the three National Holidays, employees are presently entitled to 14 Gazetted and 2 Restricted holidays every year. Out of the 14 Gazetted holidays, 11 are observed throughout India, while 3 are decided locally. For Restricted holidays, a list is drawn up at the local level taking local factors into consideration; employee is entitled to choose anytwoin a year out of that list. There are demands to include May Day and 14th April as compulsory holidays throughout India. Suggestions have also been received to increase the number of locally decided Gazetted Holidays from 3 to 6.

 Analysis and Recommendations

9.2.20 The Commission is of the view that the present system is working well. Accordingly, status quo is recommended.

Half Pay Leave (HPL) or Leave on Half Average Pay (LHAP)

9.2.21 Presently, government employees are entitled to 20 days of Half Pay Leave for each completed year of service, credited @10 days on the 1st of January and 1st of July every year. There are representations that encashment of HPL should be allowed at the time of superannuation.

 Analysis and Recommendations

9.2.22 The demands lack merit. Elsewhere in the report it has been recommended that 20 days HPL granted to “Vacational” staff be converted into 10 days EL. Hence, HPL will henceforth not be available to them. No change other than this is recommended.

 Hospital Leave

9.2.23 This leave is granted to Group `C’ Railway employees if they are suffering from illness or injuries directly due to risks incurred in the course of official duties, on production of medical certificate. Full pay is admissible for first 120 days and half pay thereafter. The leave may be combined with any other kind of leave due and admissible, provided total period of leave does not exceed 28 months. Demands have been received to increase this leave to an unlimited period of time as applicable to PBORs of defence forces.

 Analysis and Recommendations

9.2.24 This has been discussed under Special Disability Leave.

Leave Not Due (LND)

9.2.25 LND is granted when the employee has no half-pay leave at credit and he/she requests for the grant of Leave Not Due. It is granted only on medical certification, if the leave sanctioning authority is satisfied that there is a reasonable prospect of the employee returning to duty on its expiry. LND during the entire service is limited to a maximum of 360 days and will be debited against the half-pay leave that the employee may earn subsequently. No demands have been received regarding this leave. Accordingly, status quo may be maintained.

 Maternity Leave

9.2.26 Maternity leave is granted to women government employees–up to 180 days for pregnancy and 45 days in the entire service for miscarriage/abortion. Maternity leave can be combined with any other leave upto two years without medical certificate. The Commission has received representations for enhancement of Maternity leave to 240 days with full pay and further 120 days with half pay.

 Analysis and Recommendations

9.2.27 It is noted that Maternity Leave was raised from 135 days to 180 days and ‘period in continuation’ raised from 1 year to 2 years by the VI CPC. No further increase is warranted. Status quo is recommended.

Paternity Leave

9.2.28 Presently, a male employee with less than two surviving children may be granted Paternity Leave for a period of 15 days during the confinement of his wife, up to 15 days before or six months from the date of delivery of child. Paternity leave may also be granted to a government servant with less than two surviving children on valid adoption of a child below the age of one year, within a period of 6 months from the date of valid adoption. There are demands to increase the period to 30 days.

 Analysis and Recommendations

9.2.29 Present dispensation of 15 days is adequate. Status quo may be maintained.

Sick Leave

9.2.30 This leave is admissible to defence personnel only on account of sickness attributable/ aggravated due to service conditions. Full pay is granted for the entire duration of hospitalization. Beyond that, defence officers are allowed Sick Leave with full pay and allowances for first six months and fully pay only for next 18-24 months, while there is no such limit for PBORs. There are demands from CAPFs for complete parity with defence forces in respect of provisions of Sick Leave.

 Analysis and Recommendations

9.2.31 Discussed under Special Disability Leave.

Special Casual Leave (SCL)

9.2.32 SCL is granted to employees to cover their absence from duty for various occasions like sports events, cultural activities, participation in Republic Day Parade, voluntary blood donation, Trade Union meetings, etc. Full pay is granted during SCL and it can be sanctioned with retrospective effect also. There are demands to extend SCL to organ donors till the time they are fit to resume duty.

Analysis and Recommendations

9.2.33 The Commission would like to express its concern at the widespread use of SCL as a means of getting away from duty. However, because of the extensive scope and case specific nature of this leave, no concrete recommendations can be made. The government may, however, consider the following suggestions:

1. Review the purposes for which SCL is presently granted.
2. Limit the number of purposes for which an employee can be granted SCL in a year.
3. Limit the total number of days that an employee can be granted SCL in a year.

Special Disability Leave

9.2.34 It is admissible to civilian employees when disabled by injury intentionally or accidentally inflicted or caused by or in consequence of the due performance of official duties or in consequence of official position held. Full pay is admissible for the first 120 days and half pay thereafter. The leave may be combined with any other kind of leave due and admissible, provided the total period of leave does not exceed 24 months.

9.2.35 There are demands to remove the ceiling limit of 24 months–the duration of leave may be left to the discretion of doctor and full pay paid for the entire period.

 Analysis and Recommendations

9.2.36 There are three different kinds of leave admissible to civilian/defence employees which are granted for work related illness/injuries–Hospital Leave, Special Disability Leave and Sick Leave. It is an established worldwide practice that employees who suffer illness/injuries that are attributable to/aggravated in the course of their duty need to be adequately compensated. However, due to the inherent difference between the nature of duties of civilians and uniformed forces, a distinction needs be made in the level of compensation provided. Having said that, there is some similarity in the risks faced by different uniformed forces, and consequently parity amongst them may be considered as far as this leave is concerned

 9.2.37 The following is, therefore, recommended:

1. Hospital Leave, Special Disability Leave and Sick Leave should be subsumed in a new Leave named Work Related Illness and Injury Leave (WRIIL).

2. Full pay and allowances will be granted to all employees during the entire period of hospitalization on account of WRIIL.

3. Beyond hospitalization, WRIIL will be governed as follows:

• For Civilian employees, RPF employees and personnel of Police Forces of Union Territories: Full pay and allowances for the 6 months immediately following hospitalization and Half Pay only for 12 months beyond that. The Half Pay period may be commuted to full pay with corresponding number of days of Half Pay Leave debited from the employee’s leave account.
•  For Officers of Defence, CAPFs, Indian Coast Guard: Full pay and allowances for the 6 months immediately following hospitalization, for the next 24 months, full pay only.
•  For PBORs of Defence, CAPFs, Indian Coast Guard: Full pay and allowances, with no limit regarding period.

4. In the case of persons to whom the Workmen’s Compensation Act, 1923 applies, the amount of leave salary payable under WRIIL shall be reduced by the amount of compensation payable under the Act.

5. No Earned Leave or Half Pay Leave will be credited during the period that employee is on WRIIL.

Study Leave

9.2.38 Presently, Study Leave may be granted to all government employees with not less than five years’ service for undergoing a special course consisting of higher studies or specialized training in a professional or technical subject having a direct and close connection with the sphere of his duties as a civil servant. It is limited to 24 months, except for CHS officers who are allowed 36 months.

9.2.39 No demands have been received regarding this leave. Accordingly, status quo may be maintained.

Download the 7th Pay Commission Report

Source: Geod.in

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