A renewed discussion around employee compensation has emerged after claims that a Central Government Group C Level 1 employee lost nearly ₹25,000 during the COVID-19 period due to the 18-month Dearness Allowance (DA) freeze. The issue is now being highlighted as a key consideration for the upcoming 8th Pay Commission’s fitment factor decisions.
During the pandemic, the government had frozen DA hikes from January 2020 to June 2021 as a fiscal measure to manage economic stress. While DA revisions resumed later, arrears for the frozen period were not paid—leading to cumulative financial losses for lakhs of employees.
According to a detailed breakup circulating online, even an entry-level Group C employee with a basic pay starting at ₹18,000 experienced a gradual increase in DA entitlement that was never disbursed during the freeze period. When calculated across 18 months, the total loss amounts to over ₹25,000 per employee.
Experts and employee representatives argue that, when multiplied across the workforce, this “silent contribution” significantly supported government finances during a crisis and should now be acknowledged in future pay revisions.
DA Break-up for Group C, Level 1 Employees (Frozen Period)
| Year | Basic Pay (₹) | Dearness Allowance (DA) (₹) | Transport Allowance (TPTA) (₹) | DA on TPTA (₹) |
| 2020 Jan | 18,000 | 720 | 900 | 27 |
| 18,000 | 720 | 900 | 27 | |
| 18,000 | 720 | 900 | 27 | |
| 18,000 | 720 | 900 | 27 | |
| 18,000 | 720 | 900 | 27 | |
| 18,000 | 720 | 900 | 27 | |
| 2020 July | 18,000 | 1,260 | 900 | 63 |
| 18,000 | 1,260 | 900 | 63 | |
| 18,000 | 1,260 | 900 | 63 | |
| 18,000 | 1,260 | 900 | 63 | |
| 18,000 | 1,260 | 900 | 63 | |
| 18,000 | 1,260 | 900 | 63 | |
| 2021 Jan | 18,500 | 2,035 | 900 | 99 |
| 18,500 | 2,035 | 900 | 99 | |
| 18,500 | 2,035 | 900 | 99 | |
| 18,500 | 2,035 | 900 | 99 | |
| 18,500 | 2,035 | 900 | 99 | |
| 18,500 | 2,035 | 900 | 99 | |
| Total | — | 24,090 | — | 1,134 |
| Grand Total Loss | — | — | — | ₹25,224 |
Growing Demand for Compensation Consideration
Employee unions and observers are now urging policymakers to factor in these losses while determining the fitment factor under the 8th Pay Commission. Many argue that although the DA freeze was justified during an unprecedented crisis, the financial burden was disproportionately borne by salaried government staff.
With discussions around the 8th Pay Commission expected to gain momentum, this issue is likely to remain a focal point in negotiations between employee bodies and the government.
