3rd PRC Pay Scales and proposed fitment benefit for Executives of PSUs
The Government of India Constituted the 3rd Pay Revision Committee for the revision of pay scales, perks, allowances and other benefits available to Public Sector Undertaking Employees. The committee has to submit the report to Government within a period of six months from the date of formation.
Read Latest: 3rd PRC Recommendation accepted by the Government
Here are the details of Chairman & Members
Chairman: Justice Satish Chandra (Retd).
- Shri Jugal Mohapatra, Ex–‐IAS Officer,
- Prof. Manoj Panda, Director, Institute for Economic Growth, Delhi
- Shri Shailendra Pal Singh, Ex–‐Director (HR), NTPC Ltd.
- Ex–‐Officio Member: Secretary, DPE, Government of India
- Member Secretary: Jt. Secretary/Additional Secretary, DPE, Government of India
The government has already implemented the 7th pay commission recommendation for the central Govt Employees. The Central Public sector Employees are covered under pay commission. Hence a separate pay commission The 3rd PRC report has already been submitted to Government of India. As last PRC term has ended on 01.01.2016. The recommendation of 3rd PRC will be applicable from 01.01.2017.
Final Recommendation of 3rd PRC Committee
Pay revision will be applicable for those PSUs which can afford to pay the fitment & revised scales to their Employees. Here are the affordability criteria for the CPSEs
|Additional financial impact of the full revised pay|
package as a % of average PBT of last 3 FYs
(% of BP+DA)
|Financial impact will be within 20% of average PBT of last 3 years||15%|
|More than 20% but upto 30% of average PBT of last 3 FYs||10%|
|More than 30% but upto 40% of average PBT of last 3 FYs||5%|
|More than 40% of average PBT of last 3 FYs||Nil|
The Fitment Benefit 15% of Basic pay plus DA is proposed by 3rd PRC.The Committee has recommended the refollowing formula for the benefit of fitment to the executives of the Government Companies.
|A||B||C||D (Revised Basic Pay w.e.f. 01.01.2017)|
|Basic Pay +|
(Personal Pay /
Special Pay not
to be included)
Allowance (IDA) as
applicable on 1.1.2017
[under the IDA pattern
linked to All India
Cumulative Price Index
(AICPI) 2001=100 series]
to the next
It means if someone has a basic of 30k as on 01.01.2017 then his or her new basic would be 30k X 2.195 X 1.15 = 75730. Hence the multiplication factor for calculating new basic is 2.524.
3rd PRC recommended Pay Scales for Schedule A, B, C & D type PSUs
|Grade||Existing Pay Scale||Recommended Pay Scale||Applicable Schedule of CPSE|
|E0||12600-32500||30000-120000||A, B, C, D|
|E1||16400-40500||40000-140000||A, B, C, D|
|E2||20600-46500||50000-160000||A, B, C, D|
|E3||24900-50500||60000-180000||A, B, C, D|
|E4||29100-54500||70000-200000||A, B, C, D|
|E5||32900-58000||80000-220000||A, B, C, D|
|E6||36600-62000||90000-240000||A, B, C, D|
|E7||43200-66000||100000-260000||A, B, C|
The new proposed cap for perks & allowances is 35%.
As per committee, the CPSEs can provide to their executives / non-unionized supervisors the perks & allowances, preferably to choose from the set of the perks & allowances under the concept of ‘cafeteria approach’, the value of which can be up to the ceiling of 35% of Basic Pay. The ceiling is further recommended to be partially linked to the Industrial Dearness Allowance (IDA) in future, and thereby the CPSEs will be allowed to enhance the ceiling by 25% [of 35% of BP (i.e. by 8.75% of BP)] whenever IDA rises by 50%.
Superannuation benefits remain same as 30% of basic pay plus DA and the recommended Gratuity ceiling is 20Lakhs.
The Committee recommended that funding/payment towards the additional amount beyond the gratuity of Rs.10 lakhs shall be allowed to be outside the limit of 30% of BP+DA. In other words, the funding of Gratuity (up to Rs.10 lakhs), alongside Provident Fund, Pension and Post superannuation medical benefits, shall be allowed within the limit of 30% of BP + DA; and the funding of additional / balance Gratuity amount beyond Rs.10 lakhs shall be allowed to be borne by the CPSEs outside the limit of 30% of BP + DA. The said funding should be based on the principle of actuarial valuation by certified Actuaries as per the accounting standards.
The Committee has recommended reducing the HRA ceilings for all class of cities. Proposed HRA for the CPSEs employees
|Class of City||HRA % of Basic pay|
|X-class (50 lakh & above|
|Y-class (5 to 50 Lakh|
|Z-class (Less than 5 Lakh|
No change in annual & promotion increment percentage, it will remain 3% of basic pay.
The Committee recommends no change in the IDA pattern and the 100% DA neutralization shall continue to be applicable. Revised IDA from 1.1.2017 shall be linked to All India Consumer Price Index (AICPI) 2001=100 series with the base of AICPI as on 1.1.2017 as per the quarterly average of AICPI of September, October and November 2016.
Location based Compensatory Allowances
|Location||% of Basic Pay|
|Areas around capital towns (Port Blair in A&N islands,|
Kavaratti and Agatti in Lakshadweep)
|Difficult Areas (North and Middle Adaman, South|
Andaman excluding Port Blair, entire Lakshadweep except
Kavaratti, Agatti and Minicoy)
|More Difficult Areas (Little Andaman, Nicobar group of|
Islands, Narcondum Islands, East Islands and Minicoy)
states (viz. Assam, Meghalaya, Manipur, Nagaland, Tripura,
Arunachal Pradesh and Mizoram), Sikkim and Ladakh Region shall
Performance Related Pay
The 3rd PRC has devised the new criteria for the calculation of PRP in the CPSEs. The weightage components are shown in below table
|Weightage Component||% of PRP Payout|
On the basis of above components, the new recommended ceiling for the extending the PRP benefit is shown here
|Executive Grade||Current ceiling (% of Basic Pay)||Proposed ceiling (% of Basic Pay)|
|E0 to E3||40||40|
|E4 to E5||50||50|
|CMD / MD (C&D)||150||125|
|CMD / MD (C&D)||200||150|