8th Pay Commission: Employee Groups Seek OROP for Civilian Pensioners

Employee and pensioner organisations have raised a demand before the 8th Pay Commission for extending the One Rank, One Pension (OROP) principle to central government civilian employees from Level 1 to Level 18. The proposal seeks to reduce differences in pension among employees who held the same post or level and completed comparable service but retired under different Pay Commission regimes.

The demand is being put forward as part of the submissions being made to the 8th Pay Commission. It remains a proposal from employee organisations and has not been adopted as government policy.

What Does One Rank, One Pension Mean?

OROP is intended to provide comparable pension benefits to people who held the same rank or level and completed similar qualifying service, irrespective of when they retired.

Pension differences can arise because employees retiring at different points may have their pensions calculated under different Pay Commission arrangements.

Employee organisations seeking OROP for civilian staff argue that the retirement date should not by itself create a permanent difference in pension for people from the same post or level.

The government introduced OROP for Armed Forces personnel in 2015, with financial benefits taking effect from July 1, 2014. Official records also show continuing revisions of defence pensions under OROP.

What Have Earlier Pay Commissions Said About Pension Parity?

According to C. Srikumar of the All India Defence Employees’ Federation (AIDEF), the issue of reducing differences between older and newer pensioners has been considered by earlier Pay Commissions.

The 5th Pay Commission recommended updating pensions of pre-1986 retirees through notional fixation linked to the pay applicable from January 1, 1986. It also recommended that consolidated pension should not be lower than 50% of the minimum pay of the revised scale applicable to the post held at retirement.

The 7th Pay Commission also recognised the issue of pension parity and referred to progressively reducing the gap between pensioners from different periods.

What Is AIDEF Proposing to the 8th Pay Commission?

AIDEF has proposed using notional pay fixation as a mechanism to connect the pensions of earlier retirees with subsequent Pay Commission revisions. Under the proposal, pension calculations would consider the post or level held at retirement, applicable pay, increments earned, promotions and career progression, as well as later revisions or upgrades to the corresponding post or level.

The organisation has also said that if a post is subsequently upgraded, reclassified or moved to a higher level, employees who retired from the same post earlier should also be considered for the corresponding benefit.

AIDEF has proposed that pension should ordinarily be fixed at 50% of the resulting notional pensionable pay, subject to the applicable minimum pension for the relevant post or level and other statutory provisions.

What Could OROP Mean for Older Pensioners?

If the 8th Pay Commission recommends an OROP-style pension equalisation mechanism for civilian employees and the government accepts it, pension differences between employees in similar posts who retired under different Pay Commission regimes could be reduced.

However, no such extension has been approved for central government civilian employees at present. The final position will depend on the 8th Pay Commission’s recommendations and the subsequent decision of the Central Government.

Disclaimer

This article discusses proposals submitted by employee and pensioner organisations to the 8th Pay Commission. The OROP extension described here is a demand and not an approved policy for central government civilian employees. Pension rules and government decisions may change, so readers should refer to official government notifications and the 8th Pay Commission’s recommendations for the latest information.