If you've ever looked at an older government salary slip or job notification, you've likely seen the term "grade pay." Many people still use it today, even though the system has changed.
So what is grade pay, and why does it still matter?
What is grade pay?
Grade pay was a fixed component of salary introduced under the 6th Central Pay Commission for central government employees. It was added to the "pay in pay band" to arrive at basic pay.
Basic pay = Pay in pay band + Grade pay
Grade pay indicated an employee's position, seniority, and level in the hierarchy. The higher the post, the higher the grade pay.
How pay bands worked
Under the 6th CPC, posts were placed in pay bands, such as:
- PB-1
- PB-2
- PB-3
- PB-4
Within each band, grade pay distinguished different levels of posts.
Common grade pay examples
- Grade pay 1800: entry-level posts
- Grade pay 2400 and 2800: junior clerical and technical posts
- Grade pay 4200: many supervisory and mid-level posts
- Grade pay 4600 and 4800: senior supervisory posts
- Grade pay 5400 and above: officer-level posts
Why was grade pay replaced?
The pay band and grade pay system was often complex and difficult to compare across departments. The 7th Central Pay Commission, effective from 1 January 2016, replaced it with a simpler pay matrix.
Each old grade pay was mapped to a new pay level. For example:
- Grade pay 1800 became Level 1
- Grade pay 4200 became Level 6
- Grade pay 4600 became Level 7
- Grade pay 4800 became Level 8
- Grade pay 5400 in PB-3 became Level 10
Why grade pay still matters today
- Many people describe posts by their old grade pay
- Some state governments and institutions referenced similar structures
- Older service records and pension calculations involve grade pay
- Job notifications sometimes mention equivalent grade pay for clarity
Grade pay and private companies
Private companies don't follow grade pay, but many use their own grade or band systems to structure roles and salaries. The principle is similar: clear levels make pay fairer and career paths clearer.
How QkrHR helps
Whether your organisation follows government-style pay levels or its own grading system, QkrHR's unlimited salary structures let you define pay components exactly the way you need. Payroll handles arrears processing automatically, which is especially useful when DA revisions or pay changes apply retrospectively. Trusted by institutions including IIT Roorkee and IIT (BHU) Varanasi, QkrHR adapts to complex pay structures.
The bottom line
Grade pay is part of India's salary history, but it still shapes how many people understand government positions. Knowing how it maps to the 7th CPC pay matrix makes salary structures much easier to follow.
Read the full explanation:
https://www.qkrbiz.com/hrms-software/hr-glossary/grade-pay
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QkrbizWhat is Grade Pay in Salary? | Pay Scale & CalculationLearn what Grade Pay means and how it's different from a Pay Scale. This simple guide defines Grade Pay's role in salary and explains how to calculate it.