8th Pay Commission: Will central government employees get salary hike in 2026?

With the tenure of the 7th Pay Commission ending on December 31, 2025, attention has now shifted to the upcoming 8th Pay Commission. Central government employees and pensioners are closely tracking developments amid expectations of a significant revision in pay and allowances from 2026.

While speculation around a 20–35% salary hike has gained momentum, clarity on timelines and actual payouts is still evolving.

Terms of Reference approved, process underway

A key procedural milestone was achieved in October 2025 when the Union Cabinet approved the Terms of Reference for the 8th Pay Commission. The commission has been given approximately 18 months from November 2025 to examine pay structures, allowances and pension-related matters before submitting its recommendations.

This indicates that while the process has formally begun, the final outcomes will take time.

When will the new pay structure come into effect?

Officially, the 8th Pay Commission is expected to take effect from January 1, 2026. However, actual salary disbursement under the revised structure may not begin immediately.

According to CA Manish Mishra, Founder of GenZCFO, the implementation delay is likely. He explains that although the effective date may be January 2026, revised salaries could reach employees only towards the latter half of 2026 or during the 2026–27 financial year. Such delays, he notes, are consistent with the experience of previous pay commissions.

What about arrears?

Despite the possible delay in payouts, employees are unlikely to lose their arrears. Experts suggest that arrears will most likely be calculated from January 1, 2026, marking the conclusion of the 7th Pay Commission period.

Once the government approves and implements the recommendations, eligible employees should receive back pay for the interim period.

Expected salary hike: What are the estimates?

Although official figures are yet to be announced, estimates suggest a salary increase in the range of 20–35% for central government employees.

The final hike will depend on several factors, including:

• Changes to the pay matrix

• Revision of allowances

• The fitment factor adopted by the commission

The overall increase could be comparable to, or slightly higher than, revisions seen under previous pay commissions.

What employees should prepare for

While expectations are high, employees should be prepared for a phased and time-consuming rollout. Historical trends show that pay commission announcements and actual salary credits often have a gap of several months.

That said, with arrears expected to be safeguarded and a meaningful revision anticipated, the 8th Pay Commission is shaping up to be a major financial event for millions of government employees and pensioners.