Covering Lost Pension

Covering pension ‘lost’ due to authorised unpaid leave

If you are off work with permission and are receiving reduced or no pay e.g. a few days of unpaid leave or a career break, you and your employer must pay pension contributions for the first 30 days of your absence if the absence is for 30 days or less. If your absence continues for more than 30 days, the whole period from day 1 onwards will not count towards your pension unless you elect to pay APCs to cover it. Therefore, any period of more than 30 days unpaid additional maternity, adoption, shared parental or parental bereavement leave will not count towards your pension unless you elect to pay APCs to cover the period.

If you are buying additional pension to cover pension ‘lost’ due to authorised unpaid leave your employer must cover 2/3rd of the cost if you choose to take out an APC contract within 30 days of returning to work, or such longer period as the employer may allow.  Your employer will only cover lost pension for a period of up to 36 months.  Your employer will not contribute towards the cost if you make an election after 30 days of returning to work (unless your employer agrees to extend that 30 day period).

The amount of ‘lost’ pension that you can buy is calculated as:

1/49th (1/98th If you were in the 50/50 section)  x lost pensionable pay for period of absence

Buying pension ‘lost’ due to industrial action

If you are absent from work due to industrial action this will not count towards your pension unless you elect to pay Additional Pension Contributions (APCs) to cover the period.

The amount of ‘lost’ pension that you can buy is calculated as:

1/49th (1/98th If you were in the 50/50 section)  x lost pensionable pay for period of absence

The cost of buying this ‘lost’ pension is paid fully by you and there is no time limit on the period over which you can choose to buy pension that was ‘lost’ due to industrial action.