7th Pay Commission Annual Increment Rates and Calculation

7th Pay Commission Annual Increment Rates and Calculation

7th Central Pay Commission Annual Increment Rates and Calculation Methods

Generally increment for Central Government employees are granted in two situations, one is Annually (called as “Annual Increment“) and another will be on promotion or financial upgradation (Promotional Increment).

Before 7th Pay Commission, all regular employees were granted annual increment  on 1st July of every year. In 7th CPC, the increment date has been divided into two segments such as, 1st January and 1st July of every year.

Date of next increment in revised pay structure

There shall be two dates for grant of increment namely, 1st January and 1st July of every year, instead of existing date of 1st July: Provided that an employee shall be entitled to only one annual increment either on 1st January or 1st July depending on the date of his appointment, promotion or grant of financial upgradation.

The increment in respect of an employee appointed or promoted or granted financial upgradation including upgradation under Modified Assured Career Progression Scheme (MACPS) during the period between the 2nd day of January and 1st day of July (both inclusive) shall be granted on 1st day of January and the increment in respect of an employee appointed or promoted or granted financial upgradation including upgradation under MACPS during the period between the 2nd day of July and 1st day of January (both inclusive) shall be granted on 1st day of July.

Click to View Clarifications on Bunching Increment

Annual Increment Calculation Method Prescribed by 7th Central Pay Commission

Increments in Pay Matrix: The increment shall be as specified in the vertical Cells of the applicable Level in the Pay Matrix.

Illustration: An employee in the Basic Pay of 32300 in Level 4 will move vertically down the same Level in the cells and on grant of increment, his basic pay will be 33300.

Withholding Annual Increments of Non-performers after 20 Years : There is a widespread perception that increments as well as upward movement in the hierarchy happen as a matter of course.

The perception is that grant of MACP, although subject to the employee attaining the laid down threshold of performance, is taken for granted.

This Commission believes that employees who do not meet the laid down performance criterion should not be allowed to earn future annual increments.

The Commission is therefore proposing withholding of annual increments in the case of those employees who are not able to meet the benchmark either for MACP or a regular promotion within the first 20 years of their service.

This will act as a deterrent for complacent and inefficient employees. However, since this is not a penalty, the norms for penal action in disciplinary cases involving withholding increments will not be applicable in such cases.

This will be treated as an “efficiency bar”. Additionally, for such employees there could be an option to leave service on similar terms and conditions as prescribed for voluntary retirement.

Grant of First Annual Increment in Recruits Pay : The main demand of the Services in this connection is that the existing stipulation that next increment will be granted from the date of attestation or mustering be done away with.

They have pointed out that trades whose skill requirements are low and whose entry level qualifications are lower invariably get attested or mustered earlier and thus are entitled to the next annual increment earlier than trades whose training period is longer.

Analysis and Recommendations

The Commission is of the view that grant of next increment in the case of recruits should not place those with higher entry level qualifications at a disadvantage.

The Commission, accordingly recommends that the date of enrolment should be reckoned for the purposes of first increment for all recruits who are finally successfully attested/mustered.

Needless to say that the most powerful keyword among the Central government employees, because a pay hike once in a year consolidated according to their basic pay. It is also a consolation even they are not getting promotion for years.

In 6th CPC tremendously modified in increment rules that the date of increment and rate of increment had been revised as first July of every year and 3% of basic pay.

In the same way in 7th CPC, employees are seeking modifications in the rules of getting increment…

NC JCM Staff Side suggested to 7th Pay Commission on Increment.

Increment

Whether the present system of annual increment on 1st July of every year uniformly in case of all employees has served its purpose or not? Whether any changes are required?

No. In fact the single date increment system has brought in anomalies, which were discussed at length at the National Anomaly Committee, without reaching an agreement.

In our Opinion, the commission must recommend, for administrative expediency, two specific dates as increment dates. Viz. 1st January and 1st July.

Those recruited/appointed/promoted during the period between 1st Jan and 30th June, will have their increment date on 1st January and those recruited/appointed/promoted between Ist July and 31st December will have it on Ist July next.

This apart the Commission is required to specifically recommend that those who retire on 30th June or 31st December are granted one increment on the last day of their service.

What should be the reasonable quantum of annual increment?

The reasonable quantum of increment should not be less than 5% of the basic pay or the rate of increment agreed upon through bilateral discussion in the Banking industry, whichever is higher.

Whether there should be a provision of variable increments at a rate higher than the normal annual increment in case of high achievers?

If so, what should be transparent and objective parameters to assess high achievement, which could be uniformly applied across Central Government?

Without defining the term “high achiever” and prescribing transparent and objective parameters to assess high achievement the system of variable increments at a rate higher than normal annual increments will be misused on subjective assessment of high achievements. For these reasons and for what we have stated in reply to question No. 2.3 the scheme of variable increment is not desirable.

Annual rate of increment @ 5% of the pay.

Fixation of pay on promotion = 2 increments and difference of pay between present and promotional posts (minimum Rs.3000).

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7th CPC Pay Matrix : Increment Anomaly Indicator