Rs 248-cr Monthly Burden on Exchequer; Enhanced DA to Reflect in Oct 1 Salary; OPS, Pay Scales, and Other Demands Remain on Table
 
Chandigarh
 
A month-long standoff between the Punjab Government and its employees finally ended on Friday with the state agreeing to raise dearness allowance (DA) by eight percent in two four percent instalments, taking DA for government employees and pensioners to 50 percent. The decision, reached after a 90-minute meeting between Chief Minister Bhagwant Mann and representatives of 12 employee and pensioner organisations, will put an additional Rs 248 crore a month burden on the state exchequer and cost another Rs 1,750 crore during the remaining seven months of the current financial year.
 
The enhanced DA will be reflected in the September salary payable on October 1, giving around eight lakh employees and pensioners relief ahead of the festive season. More significantly, the agreement has opened a dialogue between the two sides after weeks of protests, mass casual leave, a failed meeting in Jalandhar, and a legal battle over pending DA instalments and arrears.
 
From Confrontation to Negotiation
Announcing the agreement after the meeting, Cabinet Minister and AAP’s Punjab unit president Aman Arora said the talks were held in a “congenial environment” and that both sides had agreed to resolve outstanding issues through dialogue. “Employees are part of the government and only together can we take Punjab forward,” Arora said.
 
The government and employee representatives also discussed the court cases arising from the DA dispute. Arora said both sides did not want to prolong the confrontation through litigation and would attempt to resolve the issues amicably.
 
The breakthrough followed an earlier failed attempt at talks in Jalandhar. Mann had refused to meet the employees there unless they first withdrew their agitation. When the unions declined, the Chief Minister left without holding the proposed meeting. The government subsequently invoked the ‘no work, no pay’ principle over employees’ absence from duty, although it later decided against punitive action.
 
The deadlock eased after employee representatives met Chief Secretary KAP Sinha, paving the way for Friday’s meeting with Mann.
 
Finance Minister Harpal Singh Cheema, Arora, Cabinet Minister Dr Baljeet Kaur, Chief Secretary Sinha and other senior officials attended the meeting along with 12 representatives of employee and pensioner organisations.
 
Court Order was the Immediate Backdrop
The agitation had intensified after the August 3 Punjab and Haryana High Court judgment, which directed the government to release updated pending DA/DR instalments according to the central pattern. The court had ordered payment within 15 days and stipulated six percent annual simple interest on the outstanding amount for the period of delay beyond the deadline.
 
The government challenged the order in the Supreme Court, arguing that payment of such a large amount within 15 days was financially and constitutionally difficult. It also maintained that the state had the power to determine DA rates under its rules.
 
The government had told the court that around Rs 6,000 crore had already been paid under liquidation and that arrears of pensioners and other beneficiaries were being cleared in phases. The Supreme Court had not stayed the High Court order.
 
DA Settled, Bigger Demands Remain
Friday’s agreement settles the immediate DA issue, but the employees’ larger charter of demands remains unresolved. These include restoration of the Old Pension Scheme (OPS), Punjab pay scales for employees recruited on central scales after July 17, 2020, full salary during probation, restoration of allowances, implementation of Assured Career Progression (ACP), revision of Mid-Day Meal workers’ honorarium, payment to incentive-based workers, and abolition of the Rs 200 monthly professional tax.
 
The unions have also sought basic pay plus applicable allowances for contractual employees and departmental absorption of computer teachers after their regularisation.
 
Union leader Satish Rana said Mann had assured the employees that the demands concerning OPS, the pay structure of post-July 2020 recruits, and full salaries during probation would be examined on priority.
 
OPS Remains a Political Flashpoint
Leader of Opposition Partap Singh Bajwa, meanwhile, accused the government of moving away from its 2022 election promise to restore the non-contributory OPS. He questioned the repeated extension of the committee examining the pension system and alleged that the government was considering a contributory “guaranteed pension” model instead.
 
Bajwa said if employees were required to contribute 10 percent of their salary under the proposed system, the government should explain how it differed from OPS. He sought a clear response from Mann and Cheema on whether the old scheme would actually be restored.
 
The government has said the OPS demand, along with the 2.59 pension multiplication factor, allowances, ACP, probation-related issues and generalisation of court decisions, will be examined keeping in view rules, financial implications and the legal position.
 
Monthly Talks, Women’s Postings Promised
Seeking to prevent future employee-government confrontations, Mann announced compulsory monthly meetings with employee representatives. The next round is expected in the first week of October or within about a fortnight.
 
The Chief Minister also announced that women government employees would be given postings within 40 km of their homes, citing the need to help them balance professional and family responsibilities.
 
Mann highlighted the government’s recruitment record, saying around 70,000 government jobs had been provided through a transparent and merit-based process.
 
Calling employees the “backbone” of the state’s administrative machinery, Mann said, “A happy employee is a productive employee.”
 
He said employee welfare had to be balanced with the state’s financial health and assured that genuine grievances would be addressed through regular dialogue. “Employees are an important part of our family,” Mann said, signalling a shift from confrontation to sustained engagement after weeks of agitation.