Guide for plan members

College 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.

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.

Please note: if you are purchasing your leave as a lump sum, you must buy service for the entire leave period (or in annual portions, if the leave is longer than one year).

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

How to transfer service between public sector pension plans

If you leave your job, you may be able to transfer your pensionable and contributory service from your original pension plan to your new employer's pension plan. You can do this if the two pension plans have a transfer agreement.

Things to think about when transferring service

Transferring service may allow you to increase two kinds of service:

• Pensionable service, which may increase the value of your pension
• 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, particularly if:

• The total value of the two separate pensions is more than the value of the single pension after a transfer
• You can collect a pension earlier under your former plan

It's a good idea to talk with an independent financial adviser to help you decide if transferring service is a good choice for you.

Differences in pension service value between plans

The service you transfer from another plan may not have equal value in BC's College Pension Plan, and vice versa, due to:

• Different pension benefit formulas in each plan
• Salary differences between your old and new jobs

As a result, the service you receive credit for when you transfer service may not equal the service you accumulated while you were working.

If the value of the service you are transferring from your original plan is less than the cost of buying the same service in the new plan, there is a service shortfall. The potential for a service shortfall exists each time you transfer service between public sector pension plans, even if you are returning to a plan you previously belonged to.

If you're transferring service to the College Pension Plan and there is a service shortfall, you can pay for the shortfall and be credited with full service. You must pay for any service shortfall in one lump sum and within a specific period.

If you do not want to pay for the service shortfall, you will be credited with pro-rated pensionable and contributory service based on the amount of service transferred.

When you transfer service to the College Pension Plan from another plan, you will receive matching amounts of contributory service and pensionable service.

How transferring service affects your pension

If you transfer service from your former pension plan to the College Pension Plan, your eventual pension will be calculated using:

• The combined eligible service from all plans (this may be adjusted if there is a shortfall)
• Your five-year highest average salary from only the College Pension Plan
• The retirement age specified by the College Pension Plan

What is the process?

If you're leaving an employer that participates in the College Pension Plan and would like to transfer your service to another plan that has an agreement with us, contact the new plan.

If you've joined the College Pension Plan and would like to transfer your service from your old pension plan, submit the Pension transfer application form. We'll tell you if you are eligible and let you know how much service we'll credit to you from your former plan. You can then use this information to decide whether you want to transfer service to the College Pension Plan and collect a single pension when you retire, or collect two separate pensions.

There are deadlines for transferring service; contact us as soon as possible so we can confirm your eligibility and provide you with an estimate.

Other considerations

If you have a former spouse who is entitled to a share of your pension, the pension will need to be divided before any service can be transferred. Contact us for more information.

There may be tax implications associated with transferring service. You may wish to speak with an independent financial adviser before making your final decision about transferring eligible service between plans.

Deciding not to transfer service

If you decide not to transfer your service from one pension plan to another, when you retire you will be eligible to receive a separate pension from each plan in which you have pensionable service.

The pension you earn in any other plan will not affect the pension you earn with the College Pension Plan.

Arrears

A period of arrears refers to a time when you and your employer should have been contributing to BC’s College 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 may 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.

Disability benefits

If you become totally and permanently disabled before age 65, you may be eligible for a disability benefit from BC's College Pension Plan. If you remain disabled at age 65, you will be paid a disability benefit for your lifetime. This replaces any termination benefits or regular pension you would normally receive as a plan member.

Are you eligible?

To be eligible for a disability benefit, you must:

• Be under age 65
• Have at least two years of contributory service
• End your employment
• Not be eligible to receive benefits from a group disability plan approved by the College Pension Plan
• Not have accepted a lump-sum payment to settle a group disability plan claim (if you have accepted a lump-sum payment, you may be entitled to termination benefits or a regular pension)

If you are age 55 or older, you may be eligible to apply for a regular pension. If you have 35 years of contributory service, contact the plan to discuss your options.

How do you qualify?

You must apply in writing to the plan for a disability benefit by the later of:

• Two years from the date of your last contribution to the plan
• Two years from the last day you received a benefit payment from a group disability plan

If you were denied long-term disability benefits and are appealing that decision, you still need to apply within the two-year limit.

Once you apply, in order to qualify, both your doctor and a doctor appointed by the plan must agree you are totally and permanently disabled.

How is a disability benefit calculated?

We calculate disability benefits the same way we calculate regular pensions, except:

• There is no bridge benefit
• Disability benefits are never reduced because of your age or years of service

For disability benefits (just like regular pensions):

• The calculation is based on your years of pensionable service and the average of your five highest years of salary
• You are able to choose from the same pension options and guarantees
• The amount of your disability benefit may increase annually to reflect changes in the cost of living (but this is not guaranteed)
• Depending on the pension option you selected when you applied for your disability benefit, your spouse or beneficiary(ies) may be eligible to receive a pension benefit upon your death

What happens if you are no longer disabled?

If you are no longer disabled, we will stop paying you your disability benefit.

If you return to work for an employer participating in the plan, you and your employer will resume making pension contributions to the plan. When you retire, you will be eligible for a regular pension.

If you do not return to work, or you return to work for an employer that does not participate in the plan, contact the plan to learn about your pension options.

If you are eligible for a regular pension or termination benefit, we will calculate it using your total years of service:

• You will not receive service for the period you were receiving the disability benefit
• There is no adjustment for the disability benefit that was already paid

Why would you take a disability benefit rather than a regular pension?

If you become disabled after your earliest retirement age but before you turn 65, a disability benefit may provide you with a higher benefit than a regular pension.

The rules for calculating disability benefits are complex. Contact the plan for information or to discuss your individual situation.