Government rolls out new rules for Dress Allowance: Employees to receive payments based on service period

New Delhi (The Uttam Hindu): The central government has made a significant change to the dress allowance rules, affecting millions of employees. According to a new order issued by the Postal Department, employees joining or retiring mid-year will now be paid dress allowance on a pro-rata basis. This decision has ended confusion among employees regarding payment.

The order, issued on September 24, 2025, clarifies that employees who join or retire mid-year will be paid an allowance proportionate to their service period, rather than for the entire year. This new rule will also apply to employees joining after July 1, 2025. It should be noted that dress allowance is given to employees who must wear uniforms on duty. This allowance combines several previous allowances, including clothing, shoes, and uniform maintenance.

The order also clarifies that dress allowance is typically paid with the July salary. Many employees retiring this year have already been paid their full or half allowance. Under the new rules, any excess payments will be recovered from employees retiring after October 1, 2025. However, the government has provided relief by stating that no recovery will be made from employees retiring on or before September 30, 2025.

The department has also clarified that employees who joined their jobs before July 2025 will receive their allowances according to the old rules. Furthermore, offices that did not include last year's allowances in their July 2025 salaries have been instructed to correct this immediately.