For those times when you're absent from work it’s important to know how your pension will be affected.
Here are some of the most common reasons for being away from work, and how they affect your pension:
If you're absent from work due to illness or injury, your pension benefits will continue to build up as if you were working normally and receiving full pay.
Your basic pension contributions will continue on any pay you receive while you're off work, but if your absence continues after you've used up your sick pay entitlement, you won’t pay any contributions but your pension will continue to accrue as normal. This is because your employer will continue to make contributions into your pension as if you were still on full pay. This is called assumed pensionable pay.
Family related leave
If you're absent from work due to maternity, paternity, adoption or shared parental leave, your pension will continue to build up as if you were still at work and on full pay, although the contributions you actually pay will be based on the pay you receive at the time.
As with sick leave, this is called assumed pensionable pay. The periods for when this applies, and when your employer will continue to make contributions into your pension as if you were still on full pay, are as follows:
- any paid maternity leave (including any period when only statutory maternity pay is paid)
- any paid adoption leave (including any period when only statutory adoption pay is paid)
- any unpaid maternity or adoption leave during the 26-week ordinary maternity leave or ordinary adoption leave period
- statutory paternity leave
- paid shared parental leave
Unpaid family related leave
Any period of unpaid maternity or adoption leave beyond the 26 week ordinary maternity or adoption leave period and any period of unpaid paternity or shared parental leave will not count for pension purposes unless you have a right to return to work. If this is the case you can choose to pay back the pension contributions for the unpaid period to make it count.
If you are called for jury service and you're still paid by your employer, your pension won’t be affected but you must pay pension contributions based on your normal pay.
If you're absent from work because of industrial action, the period that you lose pay for won’t count for pension purposes. You will have the option to buy the pension you have lost by paying Additional Pension Contributions (APCs). You will be responsible for the full cost as your employer does not contribute to a lost pension APC for unauthorised absences.
Reserve forces leave
Your pension will continue throughout any period of reserve forces leave even if you're being paid by the Ministry of Defence during this time.