8th Pay Commission: Higher fitment factor may hinge on family unit revision. Explained

Employee's unions have demanded to increase the number of family unit from 3 to 5 to calculate fitment factor for 8th CPC.

This issue also came up in the Rajya Sabha on July 28, 2025 through an unstarred question by member, Javed Ali Khan. He had asked, "whether Employees' Unions have demanded to increase the number of family units from 3 to 5 including parents of the employees to calculate fitment factor for 8th CPC.".

Need for change

Pay Commissions in the past have calculated minimum pay of employees based on the 15th Indian Labour Conference (ILC) norms of 1957, which recommended that a need-based minimum wage for a single worker should cover all the needs of his/her family. Under these norms, a family is taken to consist of a spouse and two children below the age of 14. The 7th Pay Commission continued with this norm and calculated a fitment factor of 2.57 while taking into account a family unit of 3 members.

Employees are now expecting that the 8th Pay Commission would consider a family unit of 5 for fitment calculation. Doing so would eventually result in a higher fitment factor.

"The Present system of treating a family as 3 Units should be dispensed with and the Family should be treated as 5 Units (employee 1 Unit, Spouse 1 Unit (No Gender Discrimination), 2 Children, 0.8 Units each of the parents 0.8 Units. This works out to a total of 5.2 Units (Rounded off to 5 Units)," the Staff Side of NC-JCM suggested in its memorandum to the 8th CPC.

Arguing for the need for this change, the Staff Side shared the following points with the 8th CPC:

• This is in conformity with the legal obligations under the Maintenance and Welfare of Parents and Senior Citizens Act.

• Under Social Security Code 2020, definition of "family" includes dependent parents while female employees are allowed to add their parent-in-laws.

• Supreme Court in Bhupendra Nath Hazarika Vs State of Assam highlight that the legitimate aspirations of employees should not be frustrated and that the government must act as a model employer by ensuring fairness, trust, and transparency in its treatment of employees.

• The current Minimum Pay is inadequate and must ensure a decent standard of living and not subsistence.

As per Staff Side's calculation, taking a family unit of five at current expenses would result in a fitment factor of 3.833, which is significantly higher than the 2.57 factor recommended by the 7th CPC.

The following table shows the calculation of the fitment factor by the staff side:

The staff side also said that the minimum pay for a family unit of five should be ₹69,000. "Pay Revision is an investment in human capital and economic growth, not merely expenditure. Therefore, considering the average retail prices of the Food items, Clothing expenditure, 7.5% for Housing, 20% for Fuel, Electricity, Water Charges, 25% for Skill Development, 25% for Additional Expenditure towards marriage, recreation, festival etc., as per Supreme Court Judgment of 1991 and Technology Charges at the rate of 5%, the minimum pay computed by the Staff Side National Council (JCM) is ₹69,000/- for 5 Unit Family."