If you are granted authorised unpaid leave, it may impact your pension. It depends on when the period of authorised unpaid leave started.
Authorised unpaid leave for less than 15 calendar days
Your LGPS benefits continue to build up as if you were working normally on full pay.
You and your employer both pay the pension contributions that would have been paid if you were at work receiving your normal pay.
Authorised unpaid leave for 15 calendar days or more
If your employer allows you to take unpaid leave that lasts 15 days or more, the break will not automatically count for pension purposes.
You can elect to buy some or all of the pension you lost during the unpaid period by paying extra contributions. The arrangement is called a Qualifying Additional Pension Arrangement (QAPA).
Paying for lost pension
You can pay the contributions by lump sum or regular deductions from your pay. Your employer informs you of the cost and your payment options.
Contributions are based on your normal contribution rate and on the pay you would have received if you had been at work. Your employer also pays the contributions they would have paid if you had not been absent.
The pension you buy mirrors the pension you would have built up if you had been at work.
Deadlines
You have one year after returning to work, or the date you leave the employment you were in during the unpaid leave, to decide if you wish to pay for the lost pension. Your employer can allow a longer deadline.
If you miss the deadline, the rules before 1 April 2026 apply. In addition, the cost is not on a shared basis with your employer. You pay the full cost.
Not paying for lost pension
If you do not pay for lost pension during a period of authorised unpaid leave of 15 days or more, it will not count for pension purposes. The pension you build up in your account for that year will be lower.
If you paid into the scheme before 1 October 2006, you may have protections under the 85 year rule. If you have a period of unpaid membership it may delay the date you meet the 85 year rule.
If you are in your final year of membership in the scheme and have membership before 1 April 2014, a lower final pay may affect your pension benefits.
If you are granted authorised unpaid leave for any period before 1 April 2026, you can pay Additional Pension Contributions (APCs) for lost pension.
The cost of paying for lost pension is in accordance with guidance from the Government Actuary Department (GAD).
When you return from unpaid leave your employer will write to you to ask if you want to pay APCs. They will let you know the relevant timescales.
Paying for lost pension
If you decide to pay Additional Pension Contributions (APCs) within 30 days the cost is shared between you and your employer. You pay one third and your employer pays two thirds of the cost. You can decide to pay after 30 days but you will pay the full cost. There are deadlines restricting your decision and your employer will let you know this in their letter to you.
Not paying for lost pension
If you do not pay for lost pension during a period of unpaid leave it will not count for pension purposes. The pension you build up in your account for that year will be lower.
If you paid into the scheme before 1 October 2006 you may have protections under the 85 year rule. If you have a period of unpaid membership it may delay the date you meet the 85 year rule.
If you are in your final year of membership in the scheme and have membership before 1 April 2014, a lower final pay may affect your pension benefits.
If you are paying additional contributions to increase your benefits and need to know the impact this absence may have, find out about paying extra and absence from work