Press "Enter" to skip to content

Pay Scale-What is Pay Scale? How to Calculate Pay Scale?

The Main Question is What is Pay Scale? How to Calculate Pay Scale?

Government employees’ gross salary is sum of different components.

1. Basic Pay
2. Grade Pay
3. Dearness Allowance
4. House Rent Allowance
5. Other miscellaneous allowances

-Basic pay is written in format:

  • Number1 – percent – number2 (Rs 5200-3%-20200/-)
  • Number1 – It is the basic pay at which your salary is calculated when you are appointed.
  • Number2 – It is the maximum basic pay a person can receive in a designated post.
  • Percent (3%) – To compensate for inflation, an increment is added to your basic pay after a fixed period. This increment is in percent of your current basic pay and the fixed period is usually a year.
  • Grade Pay(Rs 1800/- or whatever it is) : Apart from basic pay, government employees receive grade pay which depends on the category/class of employee.

Pay Scale-What is Pay Scale? How to Calculate Pay Scale?

The sum of basic pay and grade pay is used to calculate dearness allowance and other allowances.

The Dearness Allowance(DA) is a cost of living adjustment to allowance. It is calculated as a percentage of (Basic pay + grade pay). Dearness allowance is updated every quarter of calendar year to compensate for inflation in consumer price index. It may increase or decrease depending on inflation rate. (Decrease in DA is rare).

House rental allowance(HRA) is allowance paid for house rent. It depends city to city. Cities are classified as X, Y and Z, on the basis of their population, as recommended by Sixth Central Pay Commission in 2008. HRA is also used by the Indian Revenue Service(IRS) to provide income tax exemptions.

Miscellaneous allowance(MA) includes phone allowance, shift allowance, travel allowance etc.

Like DA all allowances are calculated on (Basic pay + Grade pay).

Now coming to the main question,
Basic pay = 5200-3%-20200
Grade pay =1800

It means your salary will be calculated as
(Basic + grade pay)+DA+HRA+MA

Presently, DA is around 110%, HRA may vary from 10% to 30% and MA can vary widely.
Here I’m assuming DA=110% HRA=20% MA=40%

Gross monthly salary
= (5200+1800)+(7000*1.10)+(7000*0.2)+(7000*0.4)
= 18900

pay scale

Your net salary (that is your in hand salary) will be a little less due to PPF and other deductions. It is about 15-20% roughly. So net salary will be around Rs.16000 per month.

This salary will change after every three months due to change in DA.

After 1year service, your basic pay will be 5200*1.03 = Rs.5356. This increase in basic pay will continue every year till it reaches 20200 limit. But most likely you will be promoted to higher designation within first 4 years of service. And this cycle will continue with different basic pay limits.

Though Basic pay changes after every promotion, Grade pay may or may not change with change in designation.

This Post is Only for Basic Information .For the Purpose of Clear the concept of Pay Scale in Government Sector. 

Reference :- Quora.com and Yahoo Answer

Be First to Comment

    Leave a Reply