If you are absent from work, your pension could be affected. This all depends on the reason you are absent. If your pension is affected then, in some cases, your employer can help you buy back the lost pension.
Sickness absence
During periods of sickness absence, you don’t lose any pension benefits.
- Whilst receiving pay: If you are receiving full or reduced pay, you will pay contributions based on the amount you are being paid. Your employer will continue to pay full pension contributions.
- If you’re not receiving pay: If you are on unpaid sick leave, you will not pay any pension contributions. Your employer will continue to make contributions.
In either situation, you will continue to build up full pension benefits, even if you leave your job without returning to work. Your pension will be based on your average pay, which is normally the amount of pay you would have received had you not been absent.
50/50 section
If you are in the 50/50 section and on unpaid sick leave, you will be moved into the main scheme from the next pay period to ensure that you build up full pension benefits from that time.
Child related leave – maternity, paternity, adoption or shared parental leave
Paid child related leave
During paid periods of child related leave, you do not lose any pension benefits. You will continue to build up full pension benefits as your pension will be based on your average pay, which is normally the amount of pay you would have received had you not been absent. Your employer continues to pay full contributions.
Unpaid child related leave
During periods of unpaid additional child related leave, you will not build up pension benefits.
The lost pension can be bought by paying for a shared cost additional pension contribution (SCAPC), your employer then pays for two-thirds of the cost providing the election is made within 30 days of returning to work.
50/50 section
If you are in the 50/50 section and you are not being paid, you will be moved into the main scheme from the next pay period to ensure that you build up full pension benefits from that time.
Authorised and unauthorised unpaid leave
Authorised unpaid leave
During periods of authorised leave of absence, you will not receive any pay and will not pay any pension contributions.
The lost pension can be bought by paying for a shared cost additional pension contribution (SCAPC), your employer then pays for two-thirds of the cost providing the election is made within 30 days of returning to work.
Unauthorised unpaid leave
During periods of unauthorised leave, you will not receive pay and will not pay any pension contributions.
Strike break
If you are off work due to industrial action, you will not build up any pension benefits.
When you return to work, you can choose to buy the lost pension by paying for an additional pension contribution (APC). This is entirely at your cost.
Reserve forces leave
A reservist can be called upon to take part in military operations up to a maximum of 12 months. During this period, you should not lose any pension benefits.
You will normally stop being paid by your employer and get paid by the Ministry of Defence (MOD) instead. The MOD should carry on deducting your pension contributions so there is no effect on your pension. If your regular employer also pays you anything, it will not count towards your pension.
Your pension will be based on the average pay you would have received had you not been on reserve forces service leave.
Jury service
If you are paid by your employer during your jury service, you will build up your normal pension benefits.
If you are not paid by your employer during your jury service, it is treated like any type of authorised unpaid leave. This means you lose pension during this time.
The lost pension can be bought by paying for a shared cost additional pension contribution (SCAPC), your employer then pays for two-thirds of the cost providing the election is made within 30 days of returning to work.
How do I buy back lost pension – shared cost additional pension contributions (SCAPC)
If you choose to buy back lost pension due to time off work, it is calculated as 1/49 of the lost pensionable pay during the period of absence (1/98 if you are in the 50/50 section during the period of absence).
Your employer will pay two-thirds towards the SCAPC cost, providing you have applied to them within 30 days of returning to work (unless you are off work because of strike action or any other type of unauthorised unpaid leave). If you miss this deadline, your employer may choose not to pay towards the SCAPC. You will be given a quote for the cost of buying back your lost pension before you make your decision.
You can use this additional pension calculator on the Local Government Pension Scheme website to get an estimate. Please do not use the ‘Buy Lost Pension – Apply’ section within the calculator, as you need to apply directly through your employer and Greater Manchester Pension Fund.
For more information or to go ahead with a SCAPC, you will need to contact your employer’s pension or HR department.