Overview: How Does a Leave of Absence Impact Your Pension?

(Background music: Welcome page with a logo of the Government of Canada Pension Centre.)

At the Government of Canada Pension Centre, we're here to help.

My name is Louise.

We all know how unpredictable our lives can be.

Balancing work, family and other priorities can be challenging. During the course of your career, you may need to take an unpaid period of leave, whether planned or unplanned.

As an active member of the Public Service Pension Plan, your employer could authorize pensionable leave without pay for reasons such as illness, maternity, parental, education, relocation of spouse, personal leave and so on.

(When the narrator says “… pensionable leave without pay for reasons such as,” a grey text box with white letters appears on the top-right corner of the screen, with the words ILLNESS/MATERNITY/PARENTAL/EDUCATION/RELOCATION OF SPOUSE/PERSONAL LEAVE. The text box disappears by the right side of the screen.)

Under the Public Service Pension Plan, you can continue to accumulate pension credits during periods of approved leave.

This allows you to maintain the full value of your pension.

Keep in mind that certain types of leave cannot be considered pensionable, such as suspensions, strikes, seasonal layoffs and unauthorized leave.

(When the narrator says “… cannot be considered pensionable, such as,” a grey text box with white letters appears on the top-right corner of the screen, with the words SUSPENSIONS/STRIKES/SEASONAL LAYOFFS/UNAUTHORIZED LEAVE. The text box disappears by the right side of the screen.)

It's important to know there is a limit on the amount of leave without pay you can count as pensionable service. Under the Income Tax Act, as a plan member, you can accumulate up to five years.

You can add another three years for child care for a total of eight years of pensionable leave without pay. When you reach this limit you cannot count any additional leave without pay as pensionable service.

Note that there are no pensionable limits for sick leave without pay and on loan situations where a public service employee is loaned out to another employer.

(The narrator is still sitting, now facing the camera. When she says “… you can accumulate up to five years,” the words 5 YEARS appear in a text box, at the top-right corner of the screen. When the narrator says “You can add another three years …,” the words 3 YEARS [underlined] appear in the same box. When the narrator says “… for a total of eight years …,” the words 8 YEARS appear in the same box. The text box disappears by the right side of the screen.)

If you have not already reached the limits, the first three months of any leave approved by your employer is always pensionable.

You must therefore pay the contributions for that period.

If you are on leave for more than three months, you can choose to count or not to count pensionable service that occurs after the first three months.

(The image is blurry and a black chart fills the screen, showing a horizontal timeline. At the very left of the timeline is written START OF LEAVE. A mark, close to the middle of the timeline indicates the words 3 MONTHS. Under that space, the words PENSIONABLE SERVICE are written. At the very end of the horizontal timeline, the words END OF LEAVE are written. Under the space that separates 3 MONTHS and END OF LEAVE, the words SERVICE WITH OPTIONS are written. The chart disappears and the narrator is sitting, at an angle.)

If you choose to count your leave of absence as pensionable service, it will automatically be included in the calculation of your pension. In this case, you would need to pay contributions for the full period of leave.

Generally, you do not need to pay those contributions prior to or during your period of leave.

However, upon returning to work, payments will be required.

You can repay the amount owing with a lump sum payment or through payroll deductions.

If you retire before your period of leave has been repaid in full, deductions would continue from your pension. And don't worry, we'll take care of the calculations.

(When the narrator says “If you choose to count your leave of absence …,” the words COUNT YOUR LEAVE OF ABSENCE appear on the top-right corner of the screen. The text box disappears upward. When the narrator says “… payments will be required …,” the words YOU ONLY START TO PAY ONCE YOU’VE RETURNED TO WORK appear on the top-right corner of the screen. The text box disappears by the right side of the screen.)

If you decide not to count your leave of absence after the first three months, you must complete the Election not to Count Leave Without Pay as Pensionable Service, PWGSC-TPSGC 2480 form.

When you sign this form, you are choosing not to count your leave without pay as pensionable service under the pension plan.

The service will not be included in the calculation of your pension.

You must sign and mail your form to the Government of Canada Pension Centre no later than three months after your return to work.

You must also still be an active plan member.

(When the narrator says “… you must complete …,” the words ELECTION NOT TO COUNT LEAVE WITHOUT PAY AS PENSIONABLE SERVICE PWGSC-TPSGC 2480 appear in a text box, at the top-right corner. The text box disappears upward.)

You should also note during any leave of absence, you retain coverage under plans such as the Supplementary Death Benefit Plan and the Disability Insurance Plan.

(The narrator is still sitting, facing the camera. When she says “… under plans, such as …,” the words SUPPLEMENTARY DEATH BENEFIT/DISABILITY INSURANCE appear in a text box, at the top-right corner. The text box disappears upward.)

For that reason, you would owe those plan contributions and premiums for the entire period of leave.

This is the case even if you opted not to count your leave without pay as pensionable service and if you are making monthly payments for a service buyback, you would still be required to make these payments while you are on leave without pay.

(The narrator picks up her coffee mug. She stands up.)

I hope this was helpful to you.

For more information about leave without pay, please visit our website at canada.ca/pension-benefits.

(When the narrator says “… please visit our website …,” the address CANADA.CA/PENSION-BENEFITS appears at the bottom of the screen. The text disappears.)

Thanks for watching!

(Text on screen: Contact information: Government of Canada Pension Centre – Mail Facility, PO BOX 8000, Matane QC G4W 4T6. Telephone: 1-800‑561‑7930. Email: pwgsc.pensioncentre-centredespensionstpsgc@pwgsc-tpsgc.gc.ca)

(Text on screen: Check us out: facebook.com/PSPC.SPAC, instagram.com/pspc_spac, twitter.com/pspc_spac, youtube.com/PWGSCanada)

[Music stops]

(Public Services and Procurement Canada signature)

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