7th Pay Commission Increment: Increment Day for Central Government Employees on 1.7.2019

After implementation of 7th Pay Commission, all group of Central Government employees are getting an annual increment on 1st January or 1st July of every year. Most of the employees are getting an annual increment 1st July of every year. So, today Increment Day for Central Government Employees.

The Central Govt has decided to implement the two date option with effect from 1.1.2016 as per 7th CPC recommendations. Before that, only one date (1st July of every year) for annual increment in the regime of 6th Pay Commission.

Calculation of Annual Increment

The rate of Annual Increment is 3% of Basic Pay (Matrix Pay). However, there is no calculation of 3% of basic pay. All we know the 7th Pay Commission designed and recommended the Pay Matrix Table for all group of CG Employees. From the table itself, we could see the next basic pay with annual increment. Let’s explain with an illustration…

In case of an employee is in the basic pay of Rs.33,300 in Level 4. When he gets an annual increment on 1st July 2019, he will just move one stage down (next cell of the same pay matrix level) in the same level. Hence after increment, his pay will be Rs.34,300

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Increments in Pay Matrix: The increment shall be effected by moving vertically down along the applicable Level by one cell from the existing cell of pay in the pay matrix .

The Pay Matrix shall comprise of two dimensions viz. horizontal range and vertical range:

(i) In the ‘Horizontal Range’, level corresponds to a functional role in the hierarchy and has been assigned level numbers 1, 2, 3 and so on, till 32. The level numbers correspond to Grade Pays in the existing system. Movement from one level to a higher level would take place due to movement to a higher functional role, including that due to promotion.

(ii) In the ‘Vertical Range’, each step denotes ‘pay progression’ within that level, and indicates the steps of annual financial progression of three percent in each level, corresponding to one increment. Movement along vertical range arises due to sanction of annual increment or grant of Selection Grade/Special Grade / stagnation / bonus increment.

Illustration :

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There is no explanation in the report of 7th CPC about the suggestion regarding the 2 Increment Days in respect of Central Government employees given by the NC JCM Staff Side.

Prior to the 6th Pay Commission, there was separate increment date for each central government employees. Sixth Pay Commission recommended uniform increment date for all the central government employees and the new conditions for granting of increment. As per the sixth CPC recommendations, Government servants completing six months and above in the same Grade Pay as on 1st of July are eligible to be granted the Increment. One who joins duty on or after 2nd January 2015, will get his annual increment on 1st July of next year i.e after rendering 17 months of service. In such a way, those who are retiring on 30th June are denied annual increment even after completing 12 months’ service in same Grade pay.

The NC JCM had highlighted such anomalies in detail to the 7th Pay Commission(Click to view the Demands). To remove these anomalies NCJCM Staff Side has proposed to recommend two increment dates at the interval of six months i.e 1st January and 1st July of every year. It is expected that, if it is accepted by 7th CPC, it will address the above issues. But unfortunately 7th CPC didn’t accept this proposal and said nothing about that.

Further, it followed same recommendation of sixth cpc that granting 3% increment on 1st July of every year . But nothing has been said about the criteria for annual increment to be granted. Hence in the context of no recommendation has been made on conditions for granting annual increment, it can be assumed that the prevailing conditions for granting annual increment to be followed.

So consequent upon implementation of 7th pay commission, there will be no relevance in respect of attendance on 1st January for granting annual increment for serving employees. Finally, the method implemented by the 6th Pay Commission, regarding the qualifications of employees to receive the annual increments, is very likely to continue after 01.01.2016. But the commission is 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.

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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.

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7th CPC Increment : The 7th Pay Commission has recommended on the rate of annual increment is being retained at 3 percent.

Illustrative Examples in Respect of annual increment…

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.

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