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Absences from work
If you’re away from work long-term, this may affect the pension you receive at retirement.
This table shows how different reasons for absence will affect your pension.
| Sick leave | When you are on sick leave, you pay pension contributions on whatever pay you receive. For example, full pay, half pay, or sick pay.
If you go onto unpaid sick leave, you will stop paying pension contributions. However, LGPS rules treat this leave as if you had paid your pension contributions in full. This means that you will keep building up pension throughout your sick leave, based on your assumed pensionable pay. You will not lose any pension. If you’re paying 50:50 contributions then go on unpaid sick leave, you will automatically move into the main section of the scheme from the start of the next pay period. So, from that point forward you will build up a full rate LGPS pension, even though you’re not paying contributions. |
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| Maternity, paternity, adoption leave | During any paid periods of maternity, paternity or adoption leave, you pay pension contributions on whatever pay you receive. You will keep building up pension throughout your paid leave, based on your assumed pensionable pay.
If you go onto unpaid leave, you will no longer pay contributions. During this time, usually weeks 39 to 52, you won’t build up any pension. You will have the option to buy back the pension you have lost. If you’re paying 50:50 contributions and go onto no pay during ordinary maternity & adoption leave (which is usually the first 26 weeks), or paternity leave, you will automatically move to the main section of the scheme from the start of the next pay period. So, from that point forward you will build up a full rate LGPS pension, even though you’re not paying contributions. |
| Authorised and unauthorised unpaid absence (including strike breaks) | During any other unpaid absence, including strike action, you will not receive any salary. This means that you won’t pay any contributions or build up any pension while you’re away. You will have the option to buy back the pension you have lost. |
| Jury service | If you receive salary during jury service, then you pay pension contributions and keep building up pension as normal.
If you don’t receive any salary during jury service, you won’t pay any contributions or build up any pension while you’re away. You will have the option to buy back the pension you have lost. |
| Reserve forces leave | If you are on reserve forces leave, you will keep building up pension based on your assumed pensionable pay. You won’t lose any pension while you’re away.
Your LGPS employer needs to tell you:
You should pass this information to the MoD who will then take the pension contributions and pay them across to the Clwyd Pension Fund, along with the employer’s contributions. During this leave, you won’t pay pension contributions from any salary you receive from your LGPS employer. |
Depending on your reason for absence, your employer will work out a salary figure to base your pension on so that it’s not affected. This is your assumed pensionable pay, or APP.
It is based on the last three months of full salary that you received. If you are paid weekly, it will be based on the last 12 weeks.
A member is on unpaid sick leave between 1st July and 31st December.
The member is paid monthly, and received the following full salary in April, May and June:
- April pensionable pay = £1,600
- May pensionable pay = £1,600
- June pensionable pay = £1,800
The average of these three months is:
£1,600 + £1,600 + £1,800 = £5,000.
£5,000 ÷ 3 = £1,666.67 average each month
The member was on sick leave for six-months, so:
£1,666.67 x 6 = £10,000 assumed pensionable pay overall for 1st July to 31st December.
If you stopped building up pension at any time during your absence, you can buy it back by setting up additional pension contributions, known as APC lost.
To find out how much you need to pay, please use the online APC lost calculator. You will need to ask your employer how much gross pensionable salary you lost while you were away.
If your absence was unauthorised or you were on strike, you need to pay all of the extra contributions to buy back the lost pension.
For other types of unpaid absence:
- If you set up the extra contributions within 30 days of returning to work, you will only have to pay 1/3rd of the contributions and your employer will pay the other 2/3rds.
- If you set up the extra contributions more than 30 days after returning to work, you must pay all of the extra contributions yourself. Your employer can choose to extend this 30 day deadline.
You have the following options for paying the extra contributions:
- You can arrange for them to come out of your salary in a single amount, or over a period of time.
- You can make a one-off payment directly to the Clwyd Pension Fund.
Please note: If you pay directly, you will need to speak to HM Revenue & Customs to arrange for the relevant tax relief to be paid back to you, as the Clwyd Pension Fund cannot do this.