Information Notice - Explanation of Dental Care Plan (DCP) coverage during Leave Without Pay (LWOP)

DATE: November 4, 2008

TO: Compensation Managers
Heads of Human Resources

Recently, there has been a notable increase in the number of appeal cases presented to the Public Service Dental Care Plan (DCP) Boards of Management related to coverage of employees who are on Leave Without Pay (LWOP). The purpose of this notice is to provide clarification on DCP coverage while an employee is on LWOP.

For a complete description of DCP administration, please refer to Chapter 5 of the Insurance Administration Manual provided by Public Works and Government Services Canada. The document may also be accessed online at the following website:

http://www.tpsgc-pwgsc.gc.ca/remuneration-compensation/ara-iam/ara-iam-menu05-eng.html

Employer-Paid DCP Coverage During Certain Types of LWOP

Employer-paid coverage will continue throughout the total period of absence for the following eight types of LWOP:

• Maternity Leave;
• Parental Leave (within the 52-week period following the birth or adoption of a child);
• Sick Leave Without Pay - Disability;
• Educational Leave Without Pay;
• leave to serve with another organization recognized as being to the advantage of the department or at the request of the Government of Canada;
• leave for Reserve Forces Training and Activities;
• the leave portion of the Leave with Income Averaging; and
• the leave portion of Pre-Retirement Transition Leave.

DCP Coverage During All Other Types of LWOP

For all other types of LWOP, employer-paid coverage continues only during the first three consecutive calendar months of such leave.

If an employee would like to maintain DCP coverage during the remainder of such leave, contributions are required starting the fourth month of the LWOP. These contributions must be remitted in advance on a quarterly basis and are required for the duration of the employee's LWOP, plus the month in which the employee returns to work.

Employer-paid coverage will not resume until the first of the month following the employee's return to work. Please note that this is not the same as the Public Service Health Care Plan.

e.g.

• An employee goes on Relocation of Spouse Leave Without Pay from February 21, 2008 to November 3, 2008 and returns to work on November 4, 2008.
• The employee has employer-paid DCP coverage through the first three full months of LWOP (March, April and May 2008). This employer-paid coverage will cease on May 31, 2008.
• The employee must remit contributions in advance on a quarterly basis for the period beginning June 1, 2008 if he wishes to have continued DCP coverage throughout the remaining period of LWOP. Contributions would be required for June through November of 2008 (inclusive) as employer-paid coverage would not be reinstated until December 1, 2008 (the first of the month following the employee's return to work).

DCP Coverage During Two or More Subsequent Periods of LWOP

An employee may take a period of LWOP where employer-paid coverage continues during that period of absence, followed immediately by a second period of LWOP where employer-paid coverage does not continue.

In such a case, if an employee wishes to have continuous DCP coverage throughout the entire leave, contributions are required starting the first full month in which the second type of LWOP begins.

These contributions must be remitted through to (and including) the month in which the employee returns to work. These contributions must be remitted in advance on a quarterly basis and are required through to (and including) the month in which the employee returns to work.

e.g.

• An employee goes on Maternity Leave from May 5, 2008 to May 4, 2009 and immediately commences LWOP for care and nurturing of pre-school children on May 5, 2009 until September 8, 2009. The employee returns to work on September 9, 2009.
• First type of LWOP: Maternity leave from May 5, 2008 to May 4, 2009. The employee has employer-paid DCP coverage throughout the entire period of this absence. This coverage will cease on May 31, 2009.
• Second type of LWOP: Care and nurturing of pre-school children from May 5, 2009 to September 8, 2009. As employer-paid DCP coverage will cease on May 31, 2009, contributions would be required to continue coverage as of June 1, 2009.
• The employee must remit contributions in advance on a quarterly basis for the period beginning June 1, 2009 if she wishes to have continued DCP coverage throughout the two consecutive LWOP. Contributions would be required for June, July, August and September of 2009 as employer-paid coverage would not be reinstated until October 1, 2009 (the first of the month following the employee's return to work).
• *Note: In the case of two consecutive LWOP, if the second type of LWOP commences on the first of the month, a contribution is required for that month.

Other Practical Reminders

• Reinstatement of coverage is not possible while an employee is on LWOP. If coverage ceases, it can only be reinstated the first of the month following the employee's return to work.
• The employee may choose which contribution rate he/she wishes to pay:
  • Employee only = $23;
  • Employee and spouse or Employee with children = $46; or
  • Employee, spouse and children = $69.

As a general rule, this contribution rate cannot be changed during the LWOP. There may be exceptional situations (e.g. death of a spouse/child or acquisition of a dependent unrelated to birth or adoption), in which case Compensation Advisors should contact the Treasury Board Secretariat.

To avoid any lapses in coverage, payment should be made to the employee's personnel office before the last day of the month in which employer-paid coverage would cease. Therefore, if employer-paid coverage were to cease on May 31, 2009, the employee would need to submit a cheque or money order payable to the Receiver General for Canada to his/her personnel office before May 31, 2009.

General enquiries concerning the Public Service DCP should be directed to Christine Haapanen, Insurance Benefits Group, Pensions and Benefits Sector, at 613-952-3260 or Christine.Haapanen@tbs-sct.gc.ca.

Assistant Secretary
Pensions and Benefits Sector

Phil Charco