Understanding a Leave of Absence and How it Affects Your Pension
Are you considering taking a leave of absence? It’s important to understand how a leave will affect your pension.
A leave includes the non-health portion of a maternity leave, as well as adoption, sabbatical, and educational leaves, and other employer-approved unpaid leaves. Periods of short-term and long-term disability are not considered leaves and you continue to accrue pensionable service based on the plan provisions.
During your leave you are not contributing to the plans and you do not accrue pensionable service in the plans. However, when you return from your leave, you will once again begin contributing and earning pensionable service in the plans.
The more pensionable service you have, the greater your pension will be at retirement. Since you do not earn pensionable service while on a leave, you may wish to purchase that service when you return. Purchasing service fills in gaps in your pensionable service, increases your pension, and may even allow you to receive a pension without a reduction earlier than if you opt not to purchase it (depending on your personal situation).
If you are considering purchasing the service associated with your leave when you return, keep in mind that the cost generally increases over time, so it is usually better to apply sooner rather than later. You can estimate the cost to purchase service online in your MyPension account.
It’s not a requirement that you apply to purchase your leave immediately once you are back to work, but to be eligible to apply you must be on a teaching contract with an ATRF employer and not be on a leave at the time you apply.
What happens if I do not return after my leave?
If you or your employer terminates your contract while you are on leave, or even at the end of your leave, your participation in the plans ends and you will not be eligible to apply to purchase service for your leave of absence. Only members who are actively contributing to the plans while on a teaching contract can apply to purchase their leave of absence. Note that different criteria apply for purchasing substitute teaching service.