7th Pay Commission: Good News for Retired Central Government Employees of This Period, DA Rate Revised for Gratuity and Leave Encashment
In a major relief for central government employees, who retired between January 1, 2020 and June 30, 2021, the Centre has revised the rates of dearness allowance (DA), under the 7th Pay Commission.
New Delhi, September 10: In a major relief for central government employees, who retired between January 1, 2020 and June 30, 2021, the Centre has revised the rates of dearness allowance (DA), under the 7th Pay Commission. The revised DA rates will impact gratuity and leave encashment calculation of the central government employees, who retired during the period from January 2020 to June 2021. 7th Pay Commission: Latest News and Updates on Expected 3% Hike in DA Rate.
The rate of DA, under the 7th Pay Commission, was increased thrice between January 1, 2020 and January 1, 2021 (4% for January 2020 to June 2020, 3% for July 2020 to December 2020 and 4% for January 2021 to June 2021). Following the hikes, central government employees were to get 28 percent of their basic pay as DA. However, the increments came into effect from July 1, 2021. 7th Pay Commission: Hike Up To Rs 81,000 Likely in Salary of Central Govt Employees, Here's How.
The Centre had said the rate of DA shall remain at 17 percent for the period between January 2020 and June 2021. This could have negatively impacted the central government employees who retired during the period. It is because, as per the existing rules, the DA on the date of retirement or death is reckoned as emoluments for the purpose of calculation of gratuity.
In addition, the pay applicable on the retirement date plus DA on that are counted for calculation of cash payment instead of leave. Dur to this, gratuity and cash payment against leave of central government employees, who retired between January 1, 2020 and June 30, 2021, would have been counted based on the DA rate of 17 percent. They would not have got benefits of the hikes in DA rate made during the same period.
Addressing the issue, the Centre has now said that the rate of DA for all employees who retired between January 1, 2020 and June 30, 2020 will be 21 percent. For employees, who retired between July 1, 2020 and December 31, 2020, the rate of DA is 24 percent. For employees retired between January 1, 2021 and June 30, 20201, the rate of DA is 28 percent. Now, the calculation of gratuity and amount of leave encashment for such employees will be based on the revised rates.
(The above story first appeared on LatestLY on Sep 10, 2021 10:26 AM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).