7th Pay Commission; DA increased by 33%, pay will increase in May

Despite the rise in dearness allowance (DA Hike) for Central Government workers under the 7th Pay Commission, the Indian Banks Association has made a major statement about bank employees’ dearness allowance. In fact, the bank’s dearness allowance for employees and officers has been enhanced. This has also resulted in orders being issued. Following that, employees will get a 33 percent dearness allowance in addition to their income.

The Union Cabinet, chaired by Prime Minister Narendra Modi, approved on March 30, 2022, the release of an additional instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners, effective January 1, 2022, representing a 3 percent increase over the existing rate of 31 percent of Basic Pay/Pension.

The All India Consumer Price Index for Industrial Workers (base 1960=100) for the quarter ended March 2022 has been certified, according to the order. which is similar to:-

8223.90 in January 2022

8217.32 in February 2022

8283.06 in March 2022

The average CPI for the above is 8241.42, resulting in 472 DA slabs (8241 – 6352 = 1889/4 = 472 slabs). The most recent DA payment was at the 471 slab. As a result, the DA slab of ‘1’, i.e. the 472 slab, has been raised for the quarters of May, June, and July 2022.

The rate of Dearness Allowance due to workers and officer employees for the months of May, June, and July 2022 will be 33.04 percent of the wage, according to Clause 7 of the 11th Bilateral Agreement dated 11.11.2020 and Clause 3 of the Joint Note dated 11.11.2020. At the same time, the directive stated that the decimal in the third place should be discarded for computing the dearness allowance due.

After that, starting in April, bank workers would be given a wage with a 33 percent DA. This money will be deposited into the same bank workers’ accounts in May. The compensation of staff officers, including bank employees, will thereafter be increased dramatically.

Four other allowances that are determined depending on the DA level may also increase. Here’s a list of them:

1. The DA is calculated in relation to the base wage. As a result, an increase in DA will also result in an increase in central government employees’ monthly provident fund (PF)

2. Employee gratuity payments will be enhanced as a result of the DA increase.

3. The increase in dearness allowance has also cleared the way for an increase in employees’ Travel/Transport Allowance and City Allowance.

4. There have also been media reports that the administration is considering raising the HRA in the same way that the DA has been raised.