Employee unions have made several demands regarding the 8th Pay Commission. One of these demands is to increase the size of the "family unit" from 3 to 5 members. The aim is to expand the base for calculating salaries. Consequently, it is expected that both the minimum basic pay and various allowances will increase. What difference will this make? Will this increase achieve its intended purpose? Let's explore the details.

Lakhs of central government employees are still getting their salaries calculated based on a single formula.

In fact, millions of central government employees are still getting their salaries calculated based on a formula that was originally designed to address a time when Indian family sizes were much smaller. Now, employee unions are demanding that the 8th Pay Commission redesign this formula. They say that today's families are unable to make ends meet based on the thinking developed just a few decades ago.

Need to change the formula

Since independence, India has used a specific formula to determine the minimum wage. This formula is based on the idea that an employee's family consists of three parts: the employee himself, his spouse, and two children. Previously, the government set the minimum wage based on the living expenses of these three members. However, employees now say that they are also responsible for caring for their elderly parents; therefore, the formula needs to be changed to include five parts.

The structure is as follows: Employee + Spouse = 1 share.
Parents = 2 shares (1 + 1).

Total = 5

Their main argument is that since they have to bear the expenses of five people, the salary should also be calculated on the basis of five people.

How will this affect your pocket?

If the government adopts a formula based on 5 units instead of the current 3 units, salaries could increase significantly. The minimum wage is likely to increase from the current ₹18,000 to approximately ₹50,000 to ₹70,000. Pensions and Allowances Of course, if the basic salary increases, dearness allowance, house rent allowance, and pension benefits are also likely to increase accordingly.

Simply put, increasing the number of units means that the government will now recognize that one employee is responsible for the expenses of five people instead of just three and, as a result, should receive higher wages. Therefore, if these demands are met, salaries will likely increase significantly.

PC: English Punjab Kesari