Garden Leave Notice Period

A Comprehensive Legal Guide

At Blackstone Solicitors, we understand that the end of an employment relationship is often the most legally sensitive time for both a business and an individual. Operating across England and Wales, our specialist employment team frequently handles enquiries regarding the “garden leave notice period.” It is a term that sounds tranquil, yet it represents a strategic manoeuvre designed to protect commercial interests, trade secrets, and client stability.

This guide explores the mechanics of garden leave during a notice period, the rights of the parties involved, and the pitfalls that can lead to costly litigation if not managed with precision.

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What is a Garden Leave Notice Period?

When an employee resigns or is dismissed with notice, they typically work through their notice period to hand over projects and train a successor. However, in certain sectors—particularly finance, law, and senior management—an employer may prefer that the employee does not remain in the building or have access to sensitive digital infrastructure.

Garden leave is the practice whereby an employee is required to serve their notice period away from the workplace. They remain an employee, they continue to receive their full salary and benefits, but they are prohibited from performing their usual duties or contacting clients and colleagues. They are, quite literally, told to stay at home and “tend to their garden” until the contract officially expires.

The Contractual Necessity of Garden Leave

In the jurisdiction of England and Wales, an employer does not have an inherent or implied right to put an employee on garden leave. This is a crucial distinction that many businesses overlook.

For a garden leave instruction to be lawful, there must be an express clause in the contract of employment. Without this clause, an employer who prevents an employee from working may be in breach of contract. High-level professionals often have a “right to work” to maintain their skills and public profile. If an employer denies them this right without a contractual basis, the employee could claim constructive dismissal.

At Blackstone Solicitors, we advise all our corporate clients to ensure their contracts contain robust garden leave provisions. Conversely, for employees, we scrutinise these clauses to ensure they are not being used as an unreasonable restraint of trade.

Rights and Obligations During the Notice Period

While on garden leave, the employment contract remains in full force. This means that the “status quo” of the employment relationship is preserved, even if the daily routine has changed entirely.

Employee Obligations

Because the employee is still under contract, they owe a duty of “fidelity” to the employer. This includes:

• Exclusivity: You cannot start a new job or set up a competing business until the notice period ends.
• Availability: You must remain available to answer questions or provide assistance if the employer requests it. You are technically still “on the clock.”
• Confidentiality: The duty to protect trade secrets and sensitive information remains paramount.
• Non-disparagement: Most contracts will prohibit you from speaking ill of the company during this time.

Employer Obligations

The employer must continue to fulfil every aspect of the contract that does not involve the provision of work. This includes paying the basic salary and providing all contractual benefits. If you have a company car, private medical insurance, or a pension contribution, these must continue throughout the garden leave notice period.

A common area of dispute involves bonuses and commission. If a bonus is “discretionary,” an employer might try to withhold it. However, if the bonus is tied to a period where the employee was active or if the contract dictates payment during the notice period, the employer must tread carefully to avoid a breach.

Why Do Firms Use Garden Leave?

The primary reason is protection. In a competitive marketplace, information is the most valuable currency. When a senior fee-earner or a top salesperson leaves to join a rival, they carry a wealth of knowledge in their head.

1. Information Decay: By keeping an employee out of the market for three or six months, the information they possess (such as upcoming bid prices or strategic plans) becomes “stale” and less useful to a competitor.
2. Client Transition: It allows the firm to introduce a new point of contact to the client without the outgoing employee interfering or attempting to “poach” the account.
3. Team Stability: It prevents the departing employee from recruiting their former colleagues or causing a dip in morale during their final weeks.

The Interaction Between Garden Leave and Restrictive Covenants

It is vital to understand how garden leave interacts with Post-Termination Restrictions (often called restrictive covenants). These are the clauses that stop you from working for a competitor for a set time after your contract ends.

The courts in England and Wales generally frown upon restraints of trade. For a restriction to be enforceable, it must go no further than is necessary to protect a legitimate business interest.

If an employee is on garden leave for three months and has a six-month non-compete clause, the employer will often find that the court will “offset” the garden leave against the restriction. Essentially, the total period that the employee is kept out of the market must be reasonable. If an employer tries to enforce a long garden leave period followed by an equally long non-compete, they may find the court strikes the whole thing out as an unreasonable restraint.

Can You Take Holiday During Garden Leave?

This is a frequent point of contention. Most employers will want the employee to use up their accrued but untaken holiday entitlement during the garden leave period. This prevents the company from having to pay out a large “sum in lieu of holiday” when the employment finally ends.

Under the Working Time Regulations, an employer can compel an employee to take holiday at specific times, provided they give the correct notice. The notice must be twice as long as the period of holiday they want the employee to take. For example, if the employer wants you to take one week of holiday, they must give you two weeks’ notice of that requirement.

Common Risks for Employers

1. Constructive Dismissal

As mentioned previously, invoking garden leave without a contractual right is a fundamental breach of contract. If the employee resigns in response to this breach, they are no longer bound by their notice period or their restrictive covenants. They could potentially walk straight into the arms of a competitor the next day.

2. Failure to Pay Benefits

The law is very strict regarding “full pay.” If an employer decides to stop a car allowance or health insurance because the employee “isn’t actually working,” they are playing a dangerous game. Any deviation from the contractual remuneration package can be seen as a repudiatory breach.

3. Length of the Leave

A notice period of twelve months is not uncommon for CEOs. However, keeping someone on garden leave for a full year is often viewed as excessive unless the business can prove an extraordinary need for such protection. The longer the period, the more likely a court is to intervene.

Advice for Employees Entering Garden Leave

If you are told to clear your desk and stay at home, the first thing you should do is take a breath. While it can feel like a personal slight, it is often a standard corporate procedure.

Steps to take:

• Secure your paperwork: Ensure you have a copy of your contract and any recent correspondence regarding your notice.
• Review your benefits: Check your latest payslip against your contract to ensure no benefits have been chopped.
• Request clarity in writing: Ask your employer to confirm the rules of your leave. Are you allowed to go on holiday? Are you allowed to take phone calls from colleagues?
• Plan your transition: Use the time to rest and prepare for your next role, but be scrupulous about not breaching your current obligations. Do not update your LinkedIn profile to show you have started a new job until your notice period has officially expired.

How Blackstone Solicitors Can Help

The laws surrounding notice periods and garden leave are nuanced and heavily dependent on the specific wording of your employment contract. Whether you are a business owner looking to protect your intellectual property or an employee who feels your career is being unfairly stifled, we provide expert legal counsel across England and Wales.

Our Services Include:

• Contract Drafting: Creating bespoke employment contracts with enforceable garden leave and restrictive covenant clauses.
• Dispute Resolution: Representing parties in negotiations when a breach of contract is alleged.
• Settlement Agreements: Advising on the terms of exit to ensure a clean break and financial security.
• Litigation: Taking or defending claims in the Employment Tribunal or High Court regarding breaches of notice and restraints of trade.

Conclusion: Navigating the Final Chapter

A garden leave notice period should be a transition, not a battleground. When handled correctly, it offers the employer peace of mind and the employee a paid period of rest before their next challenge. However, because it involves the restriction of an individual’s right to earn a living and a business’s right to protect its assets, the legal margins are incredibly slim.

By ensuring that contracts are well-drafted and that the “right to work” is respected, many of the common pitfalls of garden leave can be avoided. If you find yourself in a situation where the terms of your notice period are unclear or being challenged, seeking professional legal advice is the most effective way to protect your position.

Contact Blackstone Solicitors today to discuss your employment law needs. Our experienced team is ready to provide the clarity and support you require to navigate the complexities of English employment law.

Frequently Asked Questions

Can I be put on garden leave if I haven’t resigned? Yes, if your employer has given you notice of dismissal (for example, due to redundancy) and your contract allows for it, they can put you on garden leave for the duration of that notice.

Am I entitled to my bonus while on garden leave? This depends entirely on the wording of your bonus scheme and your employment contract. If the bonus is a contractual right and does not require you to be “actively at work” to qualify, you may well be entitled to it.

Can I move house while on garden leave? You should inform your employer. Since you are required to be “available for work,” a significant change in your location or availability could technically be a breach of contract if they need you to attend a meeting or return equipment.

What happens if I find a new job that starts sooner? You can ask your current employer to waive the remainder of your notice period. This is often done via a settlement agreement. If they refuse, you must stay until the end of your notice or risk being sued for breach of contract.

How to Contact Our Employment Law Solicitors

It is important for you to be well informed about the issues and possible implications of Employment Law. However, expert legal support is crucial in terms of ensuring a positive outcome to your case.

To speak to our Employment law solicitors today, simply call us on 0345 901 0445, or click here to make a free enquiry. We are well known across the country and can assist wherever you are based. We also have offices based in Cheshire and London.

Please visit our website to see all the Employment Law services we offer: https://blackstonesolicitorsltd.co.uk/employment-law-services/

Authored by Ben Posted in Blog, News Tagged as

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