Forfeiting Service Credit for Defined Benefit Plans

The OSA occasionally receives questions about how service credit is handled for a relief association member who resumes active service and membership following a break in service or leave of absence. Specifically, relief association trustees have asked if members must “start over” when they return after a break in service if they were not vested based on their original period of service. 

For relief associations that pay defined-benefit lump-sum or monthly service pensions, Minn. Stat. § 424A.02, subd. 3(c), requires that the method of calculating service pensions be applied uniformly for all years of active service. These relief associations generally must give credit for all years of active service, unless the relief association’s bylaws establish a cap on service credit or provide for the forfeiture of nonvested service.

Relief associations have the authority to forfeit service credit after a member separates from active service and membership, if the member has not resumed active service with the fire department and active membership in the relief association for a period as defined in the relief association's bylaws, of not less than five years.

For example, a member serves for four years and then moves from the community. The member is absent from the fire department for two years before returning and resuming active service with the fire department and active membership in the relief association. When the member resumes active service and active membership, the member retains credit for the original four years of service. Any additional service credit that is accrued is added to the four years accrued during the member’s original period of service.

As another example, a member serves for four years and then moves from the community. The member is absent from the fire department for six years before returning and resuming active service with the fire department and active membership in the relief association. If the relief association’s bylaws authorize forfeiting service credit after five years, when the member resumes active service and active membership, the member starts over in accruing service credit.

Last Updated April 2025