The new year brings good news for government employees of Maharashtra, as the state government has decided to implement the recommendations of the seventh pay commission. The state government had formed a “State pay revision committee 2017” to work out new salary structure for the state government employees based on the seventh commission, the committee submitted its report on 5 December 2018.

The Maharashtra state government has decided to adopt the salary matrix structure adopted by the Central Government as per the recommendations of the 7th Central Pay Commission. The revised salary matrix will be applicable to state government and other eligible employees with effect from January 1, 2016. This means the employees will get arrears for 36 months.

The government has decided to reduce the number of pay grades from existing 38 to 31, by merging 7 pay grades. The base salary as on 1st January 2016 will be multiplied with a factor of 2.57 to arrive at the revised salary. The special allowance for police constable, naik and hawaldar have been increased by 50% from the current amount of ₹500.

The regular/collective salary of part-employees has been increased 2.5 times, with a minimum increase of ₹1500 and maximum ₹3500.

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The state government employees will get same dearness allowance paid to central government employees on 1 January 2016, and as revised time to time. The total arrear for 36 months on account of increase in salary from 1st January 2016 is ₹38,655 crore. The state government will pay this money in five instalments in the next five years starting from the financial year 2019-20, and the amount will be deposited it provident fund and applicable pension funds of the employees. The means the employees will not get the arear amount in their bank accounts, that will be deposited in their PF and pension accounts in 5 instalments in the next 5 years. The circular says that this amount cannot be withdrawn for 2 years after it is deposited.

The monthly pension paid to retired employees also has been increased. Those who have retired after 31 December 2015, their monthly pension will be multiplied by 2.57. For others, the pension will go up depending on their age bracket, instead of current flat 10% hike. The hike will be 10%, 15%, 20% and 25% for employees aged between 80-85, 85-90, 90-95 and 95-100 years. For pensioners aged above 100 years, the hike will be 50%.

Around 20.5 lakh employees in the state will be benefited by the increase in their salaries and allowances. The increase in salaries, allowances and pensions will cost the state the government around ₹52,000 crore. Out of this around ₹14,000 crore will be needed to pay revised salaries and ₹38,655 crore for arrears.

The seventh pay commission was constituted in February 2014, and the commission submitted its report in November 2015. The NDA government had implemented the recommendations in September 2016 for the central government employees, with some minor modifications. Since then, several states have increased salaries of their employees as per the recommendations of the commission.