It’s an exciting time for a member when they go on family leave, so worrying about what happens to their pension is the last thing we want.

From your feedback you’ve expressed that you receive questions from members about what happens to their pension during this time. In addition, you’ve asked us what responsibilities you have as an employer when a member goes on family leave.

To put you at ease, we’ve created our Family Leave toolkit page with resources to share with members and examples for you.

Resources

• Maternity/Paternity factsheet (PDF, 126 KB) (This link opens in a new window)
• Active Teacher guide (PDF, 438 KB) (This link opens in a new window)
• FAQs
• Video (This link opens in a new window)

Family leave: Employer responsibilities

If a member goes on family leave (maternity/paternity/adoption leave), you need to ensure that you’re recording their service correctly during this period. Here’s a reminder of what you’ll need to be aware of:

Provided the member is receiving statutory pay or at least half of their normal monthly salary, the member’s contribution rate is based on what they would have earned if they weren’t on family leave. The employer contribution rate, currently 28.68%, is applied to the member’s actual earnings while they’re on family leave.

Example:

Julia is a classroom teacher and works full-time with an annual salary of £48,000. Julia is on a period of maternity leave, receiving half pay (£2,000 rather than her usual £4,000).

Julia’s contribution rate will be determined using her usual pay, but the rate will be applied to her actual pensionable earnings in the period.

To work out Julia’s monthly contribution you need to annualise her usual pensionable earnings:

£4,000 x 12 = £48,000

Julia will be in the 9.9% contribution band and her contributions whilst receiving half pay will be 9.9% of £2,000, i.e. £198.

Julia’s salary will continue to be reported at the usual rate of £48,000 per annum, as she’ll continue to accrue pension based on the usual pay rather than the actual pay received whilst on pensionable maternity leave.

For more examples about recording service during family leave, including ‘Keeping in touch’ days, check out our MCR guide (PDF, 2 MB) (This link opens in a new window) or read our MDC guide (PDF, 626 KB) (This link opens in a new window).