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Unified Pension Scheme (UPS): Rules on Contributions During Unpaid Leave Explained

Unified Pension Scheme (UPS): Rules on Contributions During Unpaid Leave Explained

Unified Pension Scheme (UPS): Rules on Contributions During Unpaid Leave Explained

The Department of Pension and Pensioners' Welfare (DoPPW) has issued an official clarification regarding contributions to the Unified Pension Scheme (UPS) when a Central Government civil employee is absent from duty without pay.

This Office Memorandum explains the application of the Central Civil Services (Implementation of Unified Pension Scheme under the National Pension System) Rules, 2025, specifically regarding what happens to monthly pension contributions during periods where no salary is drawn. This article breaks down these rules into plain English to help employees understand the financial implications of unpaid leave under the UPS.

Official Order Details

Issuing Authority Government of India, Ministry of Personnel, Public Grievances and Pensions, Department of Pension and Pensioners' Welfare.
Order Number No. 57/03/2022-P&PW(B)/8361.
Date of Issue 27 October, 2026.
Subject Contribution by the subscriber to the Unified Pension Scheme and Contribution by the Government during the period of absence from duty.
Applicability Central Government civil employees covered under the Unified Pension Scheme (UPS).

Quick Summary

  • No Pay, No Employee Deduction: If an employee is on leave or absent and is not receiving any pay or leave salary, no UPS contribution will be deducted from them during that period.
  • No Government Match: The government will also stop making its contribution to the employee's UPS account for any period where the employee is not required to contribute.
  • Strict Implementation: All Ministries and Departments have been instructed to bring these provisions to the notice of their NPS/UPS dealing personnel to ensure strict compliance.

Detailed Explanation in Simple Language

1. Subscriber's (Employee's) Contribution During Absence

What the document states: Rule 6 (3) of the Central Civil Services (Implementation of Unified Pension Scheme under the National Pension System) Rules, 2025 provides that no contribution shall be made by the subscriber during the period of absence from duty (whether on leave or otherwise) for which no pay or leave salary is payable.

What it means: Your UPS contributions are linked to your salary. If you take extraordinary leave (EOL) without pay, or if you are absent from duty in a way that results in a loss of pay, your regular monthly UPS contribution will not be deducted for that specific duration. Because you are not earning a base salary or leave salary, you are not expected to pay into your pension fund for that time.

2. Government's Contribution During Absence

What the document states: Rule 7 (2) provides that, subject to the proviso to rule 7 (1), no contribution shall be made by the government for the period during which the subscriber is not required to make a contribution in accordance with these rules.

What it means: The government acts as a matching contributor to your pension corpus. If you are not contributing to the UPS because you are on unpaid leave, the government will likewise pause its contributions to your account for that same period.

Practical Implications for Employees

If you are planning to take an extended period of Leave Without Pay (such as certain types of study leave without salary, or personal extraordinary leave), you should be aware that your pension corpus will not grow during this time. Both your deduction and the employer's contribution will be completely paused. Employees should consider this pause in retirement savings when making financial plans that involve taking long-term unpaid leave.

Frequently Asked Questions (FAQs)

  1. Who does this order apply to?
    It applies to Central Government civil employees who are covered under the Unified Pension Scheme (UPS).
  2. Will my UPS be deducted if I am on paid leave?
    The order specifies that contributions are stopped only for periods where "no pay or leave salary is payable". This implies that if you are on regular paid leave (like Earned Leave or Half Pay Leave where a leave salary is paid), standard contributions will continue based on the salary drawn.
  3. Can I voluntarily contribute to UPS while on leave without pay?
    The official document strictly states that "no contribution shall be made by the subscriber" when no pay or leave salary is payable. It does not specify any provision for voluntary contributions during this period in this particular document.
Source and Verification Note: The information in this article is derived directly from the official Office Memorandum No. 57/03/2022-P&PW(B)/8361, issued by the Department of Pension and Pensioners' Welfare on 27 October, 2026, titled "Contribution by the subscriber to the Unified Pension Scheme and Contribution by the Government during the period of absence from duty".
Disclaimer: This article is prepared for general informational and educational purposes only. It is a simplified explanation of the official document identified above and is not a substitute for the original order or applicable official instructions. Every effort has been made to maintain accuracy, but errors or omissions may occur. Readers should consult the original government document and their competent administrative authority for clarification or decisions affecting their individual circumstances. The website does not guarantee any particular benefit, entitlement, or outcome and accepts no liability to the extent permitted by applicable law.

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