7th Pay Commission Latest Update – In a big win for thousands of central government employees, the Department of Personnel and Training (DoPT) has announced a policy change that allows those retiring on June 30 or December 31 to receive a notional increment, boosting their pension payouts.
This long-pending issue had affected employees who retired just a day before the annual increment date—July 1 or January 1—and missed out on increased pension benefits. Now, such retirees will be considered eligible for that increment purely for pension calculation purposes.
The DoPT’s move follows several court rulings, including a landmark Supreme Court verdict, which stated that an employee who served with integrity till the last working day deserves to receive the increment—even if they retire one day before the scheduled hike.
It’s important to note: this notional increment won’t impact gratuity or other retirement benefits—it’s only meant to boost monthly pension. The government clarified that this benefit will apply only if the employee’s service was satisfactory and complete.
The increment policy, originally fixed post-2006 reforms, was rigid on retirement dates, causing many to lose out on a full year’s financial benefit. Now, with this update, the system becomes more fair and employee-friendly.
This is expected to benefit thousands each year in departments like Railways, Defense, Income Tax, and other central services. Retiring soon? If your superannuation falls on June 30 or December 31, contact your pension department right away.