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Gardening leave: All the details

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First4Lawyers. Updated, September 12, 2019

If you’ve ever resigned from a job or had your contract terminated and been instructed to spend your notice period at home rather than at work, you’ve been placed on gardening leave – also known as garden leave.

It is typically used as a way for companies to protect their interests.

Why is gardening leave used?

Companies putting employees on gardening leave will stipulate that the individual is not allowed to work for another company during that period. The organisation is also not under any obligation to provide any work to that person, so they are able to spend their time gardening – hence the name.

The goal for companies putting people on gardening leave is to ensure that the person in question is left out of the marketplace for long enough that any business-specific and industry-wide information they have will go out of date.

It also helps protect against the leaving employee poaching other workers and customers to take with them to their new organisation. However, with so many forms of communication now being used, not being in the office is often not enough protection against staff and customer poaching.

Pros and cons of gardening leave

For companies, the clear benefit of putting an employee on garden leave is that they are not exposed to sensitive company information, such as trade secrets. This means they won’t be able to take this information with them to their new role – a particular concern for those companies with employees moving to competitors.

However, businesses will also have to pay the full-time salary of someone who is not contributing to the workload. If they need to bring someone on board to cover the work, they’ll then need to pay that additional salary too.

Meanwhile, for the employee in question, there are both benefits and downsides to garden leave. Spending your notice period out of the office while being paid can allow you to dedicate some time to other pursuits, including work on a contract or freelance basis. However, if your employer has imposed a restrictive covenant on your contract, you might be prohibited from exploring other business interests.

You might also find that being out of the workplace leads to your knowledge and skills going out of date. You might find this concerning when you begin your new job.

Enforcing gardening leave

Companies putting people on gardening leave may find that the employee disregards the instruction and starts their new job or venture anyway. This leaves these organisations with the choice between letting this go and pursuing legal action, which can be a lengthy process.

A court will have to decide if an employee’s skills will suffer due to the time away from the marketplace in the event of legal action. If it decides that the individual’s livelihood will be threatened by staying out of work for this period, the company can be overruled. A court can also decide if a notice period is too long to spend out of the workplace.

It’s essential to have a clause clearly explaining the issue of gardening leave in employment contracts. If a company has neglected to set a clause like this out in your contract and then put you on garden leave, you may be able to claim for breach of contract.

If you’re looking for more information on restrictive covenants or any other employment law issues, First4Lawyers can help. Just give us a call, request a call back or make an enquiry here.

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