During the course of your career in the federal public service, you may decide to take an unpaid absence (leave without pay) from work for personal or other reasons. You can find more information about leave without pay and how it can affect your pension entitlements in the Leave Without Pay Information Package.
In addition, the following information is intended to help you understand how your pension and insurance benefits will be affected.
Do you continue to contribute to the public service pension plan during periods of leave without pay?
Yes. You continue to contribute to the pension plan for the first three months of your leave without pay. After that period, you may choose to count or not to count the balance of your leave without pay as pensionable. For more information, refer to the Leave Without Pay Information Package.
How much do you contribute to the pension plan for periods of leave without pay?
The amount that you contribute to the pension plan depends on the duration of your leave and type of leave you are taking.
Can you choose not to count your period of leave without pay for pension purposes?
Yes. While still employed, you may choose not to count periods of leave without pay in excess of the first three months. Further information and deadlines to proceed with this option are available in the Leave Without Pay Information Package.
Can you choose not to count your period of leave without pay for pension purposes and then change your mind?
Yes. Even after you have chosen not to count your leave without pay, you can, at a later date, decide to count the service through a service buyback. The cost, however, will be higher since interest will be charged. You may refer to the Service Buyback Package for more information.
Are there limits on how much leave without pay may be counted for pension purposes?
Yes. The Income Tax Act places restrictions on the total periods of leave without pay that can be treated as pensionable during an individual's career. The maximum permitted is 5 years, excluding sick leave without pay. However, you may also be credited with an additional three years of leave without pay for parenting purposes. The 5-year maximum may also be exceeded for "on-loan" situations where the services of a public service employee are loaned out to another employer.
More information on the tax implications of taking a period of leave without pay is available in the Leave Without Pay Information Package.
Are you still covered under the Supplementary Death Benefit (SDB) Plan while you are away on leave without pay?
Yes. You remain covered under the Supplementary Death Benefit (SDB) Plan and contributions for the full period of leave without pay are owed upon your return to work.
When do you have to pay your pension and Supplementary Death Benefit (SDB) contributions for your period of leave without pay?
You are not required to pay your pension and supplementary death benefit contributions until you return to work following your period of leave without pay. At that time, the Pension Centre will advise you of the amounts owing and payment methods. If, however, you are approved on a period of leave without pay for “On loan” purposes, you will be required to pay your contributions in advance.
What payment options are available to you for your contributions?
You can make payments for your pension contributions at any time in a lump sum by personal cheques, postal or bank money order. Otherwise, your pension contributions will be recovered by salary deductions upon your return to work. In certain situations it may also be possible to use your RRSPs to pay your pension contributions. Payment options are discussed further in the Leave Without Pay Information Package.
Are you still covered under your other insurance benefit plans during a leave of absence?
Yes. Coverage under your various insurance benefit plans may be extended during a leave of absence. You may contact your compensation advisor for details on these other insurance benefits and available premium or contribution payment options. The following plans provide a summary of the conditions and reasons for which your coverage may be extended:
Do you continue to pay your service buyback payments while on leave without pay?
Yes. Service buyback payments must be made on an on-going basis during the period of your leave without pay. The use of the Payment Transmittal Form is recommended when forwarding your payment(s) to the Government of Canada Pension Centre.
Can you accept a term position while you are on LWOP from your permanent job?
Yes and if you do you are considered to be in a dual employment situation. You must advise both your employers that you are working elsewhere as your benefits may be affected. Dual employment may also impact your requirement to contribute, timing of payment of deficiencies and your option to count periods of LWOP as pensionable. Further information on dual employment is available in the Leave Without Pay Information package.