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

You may be able to increase your future pension by buying service for an approved leave of absence.

Buying service for your leave of absence may increase the monthly pension amount you receive when you retire or get you closer to an unreduced pension.

In most cases, you can buy service for your leave after you return to work. For certain types of leaves (such as maternity, parental/adoption and compassionate care leaves), you can also buy service for your leave by continuing to contribute while you’re away.

Leave of absence with partial pay, top-up or allowance from your employer

During a leave with partial pay, top-up or allowance from your employer, your pension contributions and pensionable service are adjusted. For example, 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. The amount of service available to buy is the difference between your partial leave and your normal assignment.

Unpaid leave of absence

During 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.

Eligibility for buying service for a leave

You can buy service for an approved leave if you meet the following requirements:

• You were an active plan member before you took the leave
• You apply within five years of the end of the leave or within 30 days of ending your employment with the employer with whom the leave occurred, whichever occurs first
• Buying the leave does not cause you to exceed the limits described below

Limits on buying service for a leave

You can buy service for leaves up to the following maximums:

• 12 months of pensionable service in a calendar year.
• Three years of maternity or parental/adoption leave over your career. If you take off more than three years total for maternity or parental/adoption leaves, you can purchase the portion above the three-year maximum as a general leave.
• Five years of general leaves over your career.
• 35 years of total pensionable service over your career.

Restrictions apply if you want to buy a leave of absence for a period when you contributed to a registered pension plan with any other employer. Contact us for more information.

What the cost will be

The cost to buy service for your leave of absence is based on:

• The number of months of service you want to buy
• Your current full-time gross monthly pensionable salary (or full-time equivalent, if you work part time)
• The current employee and employer contribution rates

Your employer will pay its share of an Employment Standards Act (ESA)-approved leave of absence.

For general leaves, you are usually required to pay the whole cost (unless you have a separate agreement with your employer).

Estimating the cost of a lump-sum payment

Sign in to My Account and use the personalized purchase cost estimator to find out how much it may cost to purchase your leave as a lump sum.

Estimating the cost of continuous contributions

If you’re planning to make continuous contributions to your pension during an ESA-approved leave, you can estimate your monthly cost by adding together the pension deduction on two biweekly pay stubs.

Additional cost considerations

• Since your payment cost is based on current salary and contribution rates, buying your service earlier may be less expensive
• If you are making continuous contributions, your cost may change slightly month to month with regular salary increases

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 a transfer agreement
• you apply within the deadlines specified by the transfer agreement
• you have pension funds currently available in the plan you are transferring from

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

A period of arrears refers to a time when you and your employer should have been contributing to BC’s Municipal Pension Plan, but weren’t. There are two kinds of arrears: enrolment and payroll.

Enrolment arrears occur when you should have been enrolled in the plan, but were not. Therefore, you were not contributing to the plan.

Payroll arrears occur when you were enrolled in the plan correctly, but your employer did not deduct and forward the required contributions to the plan on your behalf.

When you are enrolled in the plan, you and your employer must both make contributions on your behalf. Your employer is responsible for deducting your contributions from your pay and submitting them to the plan.

You may want to check your pay stub regularly (especially after 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, follow up with your employer.

You, your current employer, your former employer or the pension plan can identify a period of arrears.

Cost for arrears

Your cost to buy arrears is based on:

• The length of the arrears period
• Your current full-time gross monthly salary (or full-time equivalent, if you work part time)
• The current employee contribution rate

When enrolment arrears are identified, you will receive a statement from BC Pension Corporation showing your cost. You may wish to pay as soon as possible. Since the cost is based on your salary and contribution rate at the time you apply to buy arrears, if your salary or contribution rate increases, it may cost you more.

When payroll arrears are identified, your employer must immediately pay the whole cost directly to the plan. They may bill you for your portion.

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 BC’s Municipal Pension Plan but did not make pension contributions.

For example, this could be when you were on probation or did casual work before joining the pension plan.

Buying non-contributory service increases the service that counts toward your pension. This may increase the monthly pension payment amount you receive when you retire, or allow you to apply for an unreduced pension earlier.

Cost for non-contributory service

The cost to buy non-contributory service is based on:

• The number of months of service you want to buy
• Your current full-time gross monthly salary (or full-time equivalent, if you work part time)
• The current employee and employer contribution rates

Sign in to My Account and use the purchase cost estimator to get an estimate of the cost.

You are responsible for paying the entire cost, unless your employer has an agreement to pay a portion of it. Ask your employer if this type of agreement applies to you.

Disability benefits

If you are totally and permanently disabled, you may be eligible for a disability benefit. 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 benefit:

• 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)