Guide for plan members
Municipal Pension Plan is committed to helping you make the most of your pension. This guide is a provincial requirement. Please use the links at right to explore the topics most relevant to you.
Buying service for a leave of absence
During your career, you might take a leave from work – such as a maternity, parental, education or general leave.A leave of absence will affect your pension. During an unpaid or partially paid leave, you are not making your regular contributions to the pension plan nor are you accumulating your regular service.
We calculate your pension using a formula based on the average of your five highest years of salary and your years of pensionable service. The more years of pensionable service you have, the greater your pension will be when you retire.
Leave of absence with partial payDuring a leave with partial pay, your pension contributions and pensionable service are adjusted to your salary. So if you receive half your regular pay during a leave, you will be making half your regular pension contributions and accumulating half your regular pensionable service. You may be eligible to buy the difference between your partial leave and your normal assignment.
Unpaid leave of absenceDuring an unpaid leave, you do not contribute to the pension plan and you do not accumulate any pensionable or contributory service.
However, you may be able to buy service for the time you took off work on an approved leave.
You can buy service for an approved leave if:
- You were an active plan member when you took the leave
- You buy the entire leave period, unless the purchase makes your service exceed 35 years in total or 12 months in a calendar year
- You apply to buy the leave within 30 days of the date your employment with the employer with whom the leave occurred ends or within five years of the end of your leave, whichever is earlier
Will my employer share the costs of buying service?
For general leaves you pay the full cost to buy your service.
There are only a few types of leaves where your employer will share the costs of buying back service, with your employer paying their portion and you paying your portion. These leaves are most commonly maternity, parental and compassionate care.
The Income Tax Act rules allow you to buy a lifetime maximum of:
- Five cumulative years of general leaves
- Three cumulative years of maternity, parental or adoption leaves
If you decide not to return to work after a leave and want to buy the service, you must apply while still on leave. We will calculate the cost for you to buy this service once your employer confirms your last day of work. The deadline for this is five years from when you return from your leave or within 30 days of ending your employment.
Buying non-contributory service
You may be able to increase your future pension by buying non-contributory service for a period when you worked for an employer that participated in the plan but were not making pension contributions. For example, this could be a period when you were on probation or did casual work before joining the pension plan. However, if you waived enrolment in the plan, on or after April 1, 2000, you are not eligible to buy the non-contributory period.Buying non-contributory service increases the pensionable service that counts toward your pension. This may increase the monthly pension payment amount you would receive when you retire.
When you buy non-contributory service, you are usually responsible for paying the entire cost. The deadline for this is five years from when you began contributing to the plan or within 30 days of ending your employment.
Transfer service between public sector plans
If you leave your job, you may be able to transfer your service from your original pension plan to your new employer’s pension plan. You can do this as long as both pension plans have an agreement to do so. You can find a list of participating employers in this guide.
Note that if you're leaving BC's Municipal Pension Plan and would like to transfer your service to another plan that has an agreement with us, please contact the new plan.
The benefit of transferring service is that it may allow you to:
- Increase your pensionable service and the value of your pension
- Increase your contributory service, which may allow you to retire earlier with an unreduced pension
However, it’s not always to your financial advantage to transfer service. It may be better to collect two separate pensions rather than transferring your service to collect a single pension. This could be the case if either:
- The total of the two separate pensions is more than a single pension after a transfer
- You can collect a pension earlier under your former plan
It is a good idea to talk with an independent financial adviser to help you decide if transferring service is a good choice for you.
Arrears are a period when you and your employer should have contributed to BC's Municipal Pension Plan, but didn't. There are two kinds of arrears: enrolment and payroll.
Enrolment arrears occur when you were not enrolled in the plan when you should have been and therefore should have been contributing to the plan.
Payroll arrears occur when your employer did not deduct and remit the required contributions to the plan when it should have.
Do you have a period of arrears?
You may have enrolment arrears if there was a period where you were not correctly enrolled in the plan and did not contribute. Whether you have enrolment arrears depends on the plan enrolment rules at the time you became eligible to enrol in the plan. Enrolment arrears might also occur if you are working for more than one employer that participates in the plan but are only contributing to the plan based on your employment with one employer.
You may have payroll arrears if your employer did not deduct your pension contributions from your paycheque, even if you were correctly enrolled in the plan.
You may want to check your pay stub regularly (particularly after you return from a leave) to make sure your pension contributions are being deducted. If you aren't sure whether your employer has made (or is making) contribution payments on your behalf, it's a good idea to follow up with your employer.
If you are totally and permanently disabled, you may be eligible for a disability pension. This pays you a monthly pension and replaces any termination benefits or retirement pension you would normally receive as a member of BC's Municipal Pension Plan.
Are you eligible?
You must meet the following requirements to be eligible for a disability pension:
- You must apply in writing to the Municipal Pension Plan within two years of the date you were last credited with service in the plan
- if you are denied long-term disability benefits and appeal that decision, you still need to apply within the two-year limit
- You must have at least two years of contributory service and be under age 60 (55 for firefighters and police) when you apply
- Your doctor and a doctor appointed by the Municipal Pension Plan must agree
you are totally and permanently disabled
- You must end your employment
- You must not be entitled to long-term disability benefits from a long-term disability plan that has been approved by BC Pension Corporation
- You cannot have accepted a lump-sum payment to settle a long-term disability claim (if you have accepted a lump-sum payment, you may be entitled to termination benefits or a retirement pension)
Looking for more detail? These links will help you