Garden leave, or gardening leave, is when an employer instructs an employee who is leaving a business (be it by resignation or termination) to stay away from the workplace during their notice period. Key elements include continued employment, which is when the person in question remains at the company during the garden leave period, and must adhere to all terms and conditions outlined in the employment contract. Another aspect is that the employee will receive their complete pay as well as any benefits. The employee may face restrictions, such as attending the workplace or accessing certain systems, contact clients and colleagues for business purposes, starting a new job for a competitor, or working self-employed against the employer’s interests. Despite restrictions, the employee is typically expected to remain available to answer questions and assist with a handover process. For garden leave to be legally enforced, an employer should have a clearly outlined ‘garden leave clause’. Without one, employers risk a claim for breach of contract.
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What is garden leave?
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A leave of absence is when an employee spends time away from work, but they remain employed.
There are many reasons why an employee may need time away from work. Such as maternity leave, for a medical appointment, or to attend jury service.
Yes, employees on sick leave receive statutory sick pay. How much you pay them should be included within their employment contract.
Yes, it's important you have an absence policy. It helps your employees to know how and who they need to report any absences they have.
Peninsula can provide practical and quality advice on how to deal with absences in your business. So if you have a problem with absenteeism, then give us a call.
In this guide, we'll discuss what menstrual leave is, the benefits of offering it, as well as how you can create your own menstrual leave policy.
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When staff leave, it’s mostly unavoidable - and could be reasons beyond your control. For example, they might resign to join a competitor company.
In this instance, you may decide you want to place them on garden leave. Also known as gardening leave, it is typically used to protect an employer’s business interests.
But, failure to manage it correctly could mean you're breaching an employment contract, potentially leading to employment tribunal claims.
In this guide, we'll discuss what garden leave is, employee rights during this type of leave, and the benefits it can bring.
Peninsula also offer a HR documentation service, meaning we'll create bespoke contract and documentation - ensuring compliance at all times.
What is the garden leave definition?
Garden leave is a type of leave used when an employee is leaving a job - usually, to work for a competitor of their current employer.
During their from the company, both the employer and the employee remain bound by the terms of their .
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What are the key aspects of garden leave in the UK?
if you're looking to implement garden leave in your company, it's important you understand the key aspects that are involved. These are:
Notice period: garden leave is used during an employee's notice period before leaving your business.
Continued employment: the employee in question is still employed during this period of leave, with the terms of their employment contract being in place.
Payments and benefits: an employee on garden leave must still receive their usual benefits. contractual obligations, and salary.
Restrictions: an employee on garden leave is placed under certain restrictions, for example speaking with clients or other employees.
Can any employee be put on garden leave?
Yes, any employee can be put on garden leave. As long as their contract of employment is being brought to an end - and they are required to fulfil their notice period. Remember, to put an employee on garden leave, it must be a contractual right.
Most commonly, employers will apply garden leave to senior leaders within business, as they likely have a longer notice period than the statutory minimum – and they could potentially cause damage to the business.
What happens when an employee is put on garden leave?
When an employee is put on garden leave, they still receive full pay - but they are required not to attend the workplace. However, they likely have terms they must comply with set out in their employment contract. For example, they must:
Not communicate with colleagues or clients.
Not use any company equipment, such as mobile phones or laptops (unless permitted for personal use).
However, you can ask the employee on garden leave for information and assistance on current projects.
Is garden leave legal?
Yes, garden leave is completely legal under UK employment law.
Employers must act fairly during the whole process. If they don’t, it could lead to future claims being raised at an .
Can an employee start a new job whilst on garden leave?
No, typically, an employee can't start a new job whilst away from the business on garden leave. This is because they remain an employee during this period away from the company - and still have a notice period to fulfil.
So for that reason, they can't start their new role until after their last day of service when their notice period expires. If they do start a new job during this period, it could leave them at risk of .
How long is a garden leave period?
The length of someone's garden leave is dependent on the length of the employee's notice period.
For example, if an employee's contractual notice period is six months - the period of garden leave can also be half a year. Alternatively, the employee could work some of their notice and spend the remaining period on garden leave.
Reasons for garden leave
Employers place their staff on garden leave for a variety of reasons. These include:
Privacy and security: For example, senior leaders likely have access to confidential or sensitive information - which could threaten the business if they were to leave and share it. So to prevent the employee from using this information, they may be placed on garden leave.
Professional preferences: If an employee leaves or is dismissed, the employer might not want them to come to work during their notice period. Or start a new job within this time either. So, in these instances, garden leave may be the best option.
Difficulty enforcing post-termination restrictive covenants: Post-termination are used to protect your legitimate business interests and to stop key employees from being poached to rival businesses, but sometimes they're hard to enforce. So, the employer might use garden leave instead to protect their company.
Employee rights during garden leave
An exiting employee is entitled to their full salary and other contractual benefits whilst on garden leave. However, depending on their employment contracts, they may not be able to receive or commission payments.
If they want to take a holiday during their garden leave, they must receive formal approval from their employer.
Benefits of gardening leave
A garden leave period can be very beneficial for your business - in both commercial and legal ways. For example, the employee must comply with the terms of their contract until the period is over.
Other benefits include:
The employee remains available if you need assistance with a handover before they leave the company.
Prevents the exiting employee from poaching or recruiting other employees and clients to their new company.
Prevents the exiting employee from stealing client information and sensitive company data to further protect your business interests.
Prevents the exiting employee from acting in a self-employed capacity until their notice period ends (but this depends on how the clause is drafted).
Ensures the duties of fidelity and confidentiality remain intact.
How to put an employee on garden leave
How to put an employee on gardening leave is fairly simple, to do so - you must have a garden leave clause within their employment contract.
If you have a gardening leave clause in place, you can inform the employee of your decision to place them on garden leave when they hand their notice in, or after they're given notice of dismissal.
What to include in a garden leave clause
A well-drafted garden leave clause will mean the process of your employee leaving runs smoothly, and you'll avoid a breach of contract claim. If there is any confusion or something is drafted incorrectly, your employee may choose to seek legal advice.
Your garden leave clause should include:
The length of the garden leave period.
The rules they must comply with, such as not contacting clients or colleagues.
A statement saying employees must return any company property they have, such as a phone or laptop (unless permitted for personal use).
A statement saying the employee must be available to answer questions or to help with the handover for their replacement if applicable.
Can you put an employee on garden leave without a clause?
No - if you place a staff member on garden leave without a garden leave clause in the employee's contract – and they don’t agree to it, you may be at risk of breach of contract. If this is the case, the employee may raise a claim to an employment tribunal.
But, there are some cases where someone can go on garden leave without a pre-empted clause within their contract. For example, if both parties agree on the basis it's the most suitable course of action.
Can an employee request to go on garden leave?
Yes, any employee can request garden leave. This may happen after they've handed their notice in, or been given a notice for dismissal.
However, you don't have to accept their request. Remember, garden leave is usually only needed for more senior employees in your company - or those with access to your business secrets.
FAQs: What is garden leave?
Why should I use garden leave?
Primarily, as an employer, you should use garden leave to protect your business. It prevents departing employees from accessing sensitive information, preserves relationships with clients and customers, stops employees from immediately working with a competitor, and ensures the employee is available for queries and handovers.
Do I need a specific clause in the employment contract to enforce garden leave?
It's advisable to have one. Without an express contractual clause, it could be deemed a breach of contract if an employee’s forced into taking garden leave. This opens the door for an employee constructive dismissal.
How long can I place an employee on garden leave?
Generally, the length of garden leave mirrors the length of the employee’s contractual notice period. Any period must be reasonable in relation to what’s necessary to protect your company’s interests. If an employee views the periods to be disproportionately long, they may challenge it in court.
What happens to the employee’s pay and benefits during garden leave?
The employee must receive their complete salary and benefits during the entire garden leave period.
Can an employee start a new job when on garden leave?
As they’re still employed by your company, they’re tied to their contract of employment. New employment would constitute a breach of contract, meaning you could take legal action.
Get expert support on garden leave with Peninsula
When running a business, there will be times when your employees leave your company due to resignation or dismissal. When this happens, you may decide to place them on garden leave.
Garden leave helps to protect the best interests of your business. However, it's important you fully understand what this entails to ensure you're managing the situation correctly. Failure to do so could lead to a breach of contract and an employment tribunal claim.
Peninsula offers total support on any HR or Health & Safety issue you have. From unlimited advice to our full documentation and risk assessment services, we'll ensure compliance at all times. We provide advice and support to companies of all sizes - large (200+ employees), medium (51-200 employees), small (1-49 employees), and start-ups.
Want to find out more? Contact us on 0800 028 2420 and book a free consultation with an HR consultant today.
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