ARCHIVED CD 2003-004

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April 10, 2003 (Revised March 4, 2004)

SUBJECT: Contribution Payments from Employees on Leave Without Pay (LWOP) in Respect to Insurance Plans

1. PURPOSE

The purpose of this directive is to remind compensation advisors of the appropriate remittance procedures related to payments made by employees on leave without pay (LWOP). The policy and procedures apply to the following:

• the Public Service Health Care Plan (PSHCP);
• the Dental Care Plan (DCP);
• the Disability Insurance (DI) Plan;
• the Long-term Disability (LTD) Insurance Plan;
• the provincial health care plans; and
• the Blue Cross.

1.2 In this text, use of the masculine is generic and applies to both men and women.

2. CANCELLATION

2.1 This document supersedes Compensation Directive 1996-011 dated February 29,1996, and 1996-018 dated April 4, 1996.

3. POLICY

3.1 PSHCP

| Members proceeding on authorized LWOP or on seasonal/sessional layoff, may continue their coverage and that of their dependant(s) by paying in advance the required PSHCP contributions directly to their compensation advisor. If the leave is for a period of up to three months, the payment of the contributions must be made in advance for the entire period. If the leave is for a period longer than three months, the payment of the contributions can be made to cover the entire leave period or the member may choose to pay one or several months in advance, as long as the first payment covers a minimum of three months. The compensation advisor will forward the payment to the Payroll Accounting Division (PAD) for processing.

The PAD must receive the payment, at least one month in advance of the month of coverage for which the payment is intended. Otherwise, the payment will be returned to the department concerned and the coverage will lapse for this employee.

3.1.1 DCP

Employer-paid coverage will cease at the end of the first three months of LWOP for any reason other than those listed in the rule portion of Section 5.5.1 of the Insurance Administration Manual (IAM). Members may continue their coverage and that of their dependant(s) beyond the initial three months, by paying in advance the total required contribution, on a monthly or a quarterly basis, directly to their compensation advisor. The compensation advisor will forward the payment to the PAD for processing. Cheques extending beyond a quarterly period will not be accepted by the PAD.

The PAD must receive the payment, at least one month in advance of the month of coverage for which the payment is intended. Otherwise, the payment will be returned to the department concerned and the coverage will lapse for this employee.

3.1.2 DI and LTD

DI and LTD arrears of contributions, for individuals returning to duty from periods of authorized LWOP listed in the rule portion of sections 3.9.1 (DI) and 4.18.1 (LTD) of the IAM , will be recovered by monthly deductions over a period equal to the period of authorized LWOP.

It is not feasible to accept DI or LTD contribution payments in advance or in a lump sum while on authorized LWOP, since DI and LTD contribution rates change whenever the member's salary changes. Doing so would result in an administrative burden for all concerned .

A member who becomes entitled to disability benefits while on LWOP, will not be required to pay contributions for DI or LTD. Therefore, no DI nor LTD contribution arrears are to be taken upon the employee's return to work. The compensation advisor must advise the appropriate pay office (PO) to ensure that arrears of contributions are not withheld.

The PAD will only accept DI and LTD payments for employees who have been struck off strength (SOS). All other payments will be returned to the department concerned.

3.1.2.1 DI

Only members on LWOP to serve with either an employee association or a credit union are to pay their DI contributions directly to the insurance carrier at the following address:

SunLife du Canada
1155 Metcalfe Street, P.O. Box 12500, Station CV
Montreal, QC H3C 5T6

Please refer to Section 3.9.3 (DI) of the IAM.

3.1.2.2 LTD

Only members on LWOP to serve with either an employee association or a credit union are to pay their LTD contributions directly to the insurance carrier at the following address:

The National Life Assurance Company of Canada
Group Life and Disability Claims Department (PSMIP)
522 University Avenue
Toronto, ON M5G 1Y7

Please refer to Section 4-18-3 (LTD) of the IAM.

3.1.3. PROVINCIAL AND TERRITORIAL HEALTH CARE PLANS

3.1.3.1. Full Month

The government contributions for provincial and territorial health care plans for employees residing in contribution levying jurisdictions are not payable in respect of any full calendar month of LWOP. In order to maintain coverage, members must arrange to pay the required full contribution directly to the provincial authorities for any full calendar month of LWOP.

Alberta Health and Wellness
P.O. Box 1360 Station Main
Edmonton, AB T5J 2N3

Telephone number: 780-427-1432

BC Medical Services Plan
Ministry of Health
Group Operations Department
P.O. Box 9140,
Victoria, BC V8X 9E5

Telephone number: 605-669-4211

3.1.3.2. Partial Month

A member who proceeds on authorized LWOP or on seasonal/sessional layoff in the midst of a month, where there is insufficient salary remaining in that portion of the month from which the required contributions would normally be deducted, must remit his contribution payment to his compensation advisor. The compensation advisor will forward the employee's payment directly to the PAD, who will send the employee's contributions and the corresponding government share to the provincial authorities. Similarly, a member struck off strength (SOS) in the midst of a month, where there is insufficient salary remaining in that portion of the month from which the required contributions would normally be deducted, must also remit his contribution payment to his compensation advisor. Employees must arrange to pay the required contributions for all subsequent month(s) directly to the provincial authorities.

3.1.4. QUEBEC BLUE CROSS and BLUE CROSS ATLANTIC CANADA

In order to maintain coverage under these plans, while on LWOP, employees must remit their contribution payments directly to the appropriate insurer at the following address:

Quebec Blue Cross
550 Sherbrooke St. West
Montreal, QC H3A 1B9

Blue Cross of Atlantic Canada
1874 Brunswick St.
Halifax, NS B3J 2G7

4. PROCEDURES/INSTRUCTIONS

4.1 Public Service Health Care Plan (PSHCP) and Dental Care Plan (DCP)

4.1.1 PSHCP

Compensation advisors must complete the "Contribution Remittance for Period of LWOP - Public Service Health Care Plan (PSHCP)" (PWGSC-TPSGC 2278 ) form. The compensation advisor remits copy 1 of this form, along with the employee's personal cheque or money order payable to the Receiver General for Canada, directly to the PAD at the following address.

Public Works and Government Services Canada
Pay Operations and Services Management
Payroll Accounting Division
1451 Coldrey Ave.
Ottawa, ON K1A 0S5

For additional information please refer to " PSHCP - Continuous Coverage While in Eligible Capacity" in Section 2-13-1 of the IAM.

4.1.2 DCP

Compensation advisors must complete the "Remittance of Dental Care Plan (DCP) Contributions for a Period of Leave Without Pay" (PWGSC-TPSGC 2278-1 ) form and forward copy 1 of this form, along with the employee's personal cheque, or a money order payable to the Receiver General for Canada, to the PAD at the address identified above in 3.1.1 for PSHCP.

For additional information please refer to "Leave Without Pay - When Employer-Paid Coverage is Suspended" in Section 5-5-2 of the IAM.

4.2 DI and LTD

Where the employee is SOS after a period of LWOP, the compensation advisor must ensure that contributions owing for DI or LTD are paid by the employee in a lump sum payment by cheque or money order payable to the Receiver General for Canada and are sent to the PAD. Deficiencies owing can also be taken from salary or salary related payments. The cheques are to be sent to the PAD accompanied by a "Transmittal Note and Receipt" (GC44) form that clearly identifies the individual. The following information must be transmitted directly to the PAD:

• the date and the reason of the SOS;
• the period being paid and the monthly contribution rate applicable (i.e. employee's share or employee's and employer's shares);
• the Personal Record Identifier (PRI);
• the department's full address; and
• the compensation advisor's telephone number and mailing address .

4.2.1 DI - On LWOP and On Return to Duty

Compensation advisors should refer to Section 3-9-4 of the IAM for detailed procedures.

4.2.2 LTD - On LWOP and On Return to Duty

Compensation advisors should refer to Section 4-18-3 of the IAM for detailed procedures.

4.3 Separate cheques, or postal or bank money orders must be issued for each individual plan (PSHCP,DCP,DI and LTD) and sent directly to the PAD with the appropriate remittance form.

Under no circumstances will PAD accept post dated cheques. These cheques will be returned to departments.

5. INQUIRIES

5.1 Any inquiries on the information contained in this document should be addressed to your Public Works and Government Services Canada (PWGSC) Compensation Services Office.

Original Signed by
B. Bartley

R. Jolicoeur
Director General
Compensation Sector
Accounting, Banking and Compensation

Reference(s): CJA 9006-1, 9203-8(6), 9203-8(6.1),
9203-42-7.2, 9203-8(6), 9203-8(6.1),
9203-42-7.2, 9244-2-2, 9242-2-1, and 9246-3