The federal government has raised the minimum monthly salary for its employees to Rs40,700. The new minimum increases the previous salary floor by Rs3,700.
Under the revised arrangement, federal employees earning below Rs40,700 per month will receive a special allowance. The allowance will bring their total monthly earnings up to the newly fixed minimum.
The increase will take effect retrospectively from July 1, 2026. Employees covered by the decision will therefore receive the benefit from the start of the new financial year.
The government said the decision aims to ensure that no federal government employee receives a monthly salary below Rs40,700.
The revised minimum applies alongside other pay-related measures announced for federal employees under the FY2026-27 financial arrangements.
As part of the broader pay revisions, federal civil employees received a 7 percent ad hoc relief allowance on basic pay. The allowance also took effect from July 1, 2026.
The latest decision provides additional support to employees whose salaries remain below the new minimum threshold. Such employees will receive the special allowance required to reach the fixed amount.
The previous minimum salary was Rs37,000 per month. The new floor of Rs40,700 represents an increase of Rs3,700.
The revised minimum is also around 10 percent higher than the previous salary floor. The increase is expected to provide additional financial support to lower-paid federal government employees.
The special allowance will ensure that employees falling below the threshold receive the required adjustment. Employees whose existing monthly earnings are already above Rs40,700 will not need the allowance to reach the minimum.
The move comes amid broader changes to government employees’ salaries for the new financial year. Authorities have introduced several pay-related measures to provide relief to federal civil servants.
The retrospective implementation from July means eligible employees can receive the financial benefit from the beginning of the fiscal year.
The decision is particularly significant for employees in lower salary brackets. The additional amount could help offset rising household expenses and provide some relief amid higher living costs.
The government’s revised salary structure is part of its wider effort to adjust public-sector pay during FY2026-27.
With the new minimum now fixed at Rs40,700, federal employees earning below the threshold will receive the special allowance required to bring their total monthly salary to the new floor.
