This guide is maintained as a current resource for July 2026 and covers only the laws of England and Wales. Information is for general guidance, not legal advice. Consult a qualified solicitor for advice specific to your situation.
Comprehensive guide to garden leave and redundancy in England and Wales, explaining what garden leave is, how it works during notice periods, contractual requirements, employee rights to pay and benefits, interaction with redundancy pay and holiday, and legal considerations for employers and employees.
Garden leave is a frequently used employment practice in redundancy and other exit situations. It allows an employer to keep an employee on full pay and under contract during the notice period without requiring them to attend the workplace or perform normal duties. Understanding how garden leave works in the context of redundancy, what rights employees have, and what practical and legal considerations arise can help both employers and employees manage the redundancy process with clarity and fairness. Information in this article is drawn from authoritative UK sources and current employment law practice.
What Garden Leave Is
Garden leave (sometimes spelled “gardening leave”) refers to a period when an employee remains legally employed and paid, but is not required to attend work or carry out their usual duties. It is commonly used during notice periods after resignation, dismissal, or redundancy, particularly for employees with access to sensitive information, key client relationships or competitive skills.
The term originally described a civil servant staying at home with pay, but today it appears widely in commercial employment contracts.
Garden Leave in Redundancy Situations
How It Works
When an employer confirms redundancy and issues written notice, they may place the employee on garden leave for all or part of the notice period. The employee's contract continues and they:
- Are still employed and receive full pay and contractual benefits.
- Remain subject to contractual terms such as confidentiality, fidelity and restrictive covenants (for example, non‑solicitation).
- Are generally not required to attend the workplace or perform their usual job duties.
- May be required to be available to assist with handover or answer queries if reasonably needed by the employer.
Because the contract continues during garden leave, the employer must continue to honour all contractual pay and benefits terms, unless the contract expressly limits certain elements.
Contractual Basis
Garden leave must be provided in accordance with the employment contract. Most employers include a garden leave clause allowing them to impose this arrangement up to the length of the notice period. Without such a clause, placing an employee on garden leave can risk a breach of contract claim if the employee has a legal right to work.
Rights and Entitlements During Garden Leave
Pay and Benefits
Employees on garden leave are entitled to their normal salary and contractual benefits (such as pension contributions and health insurance) until the end of their notice period. An employer cannot reduce pay during garden leave unless the contract permits it.
Redundancy Pay
Garden leave does not affect eligibility for statutory redundancy pay. If an employee qualifies for redundancy compensation, their entitlement is calculated independently based on age, length of service and weekly pay, regardless of whether they are placed on garden leave or work through their notice period.
Holiday Entitlement
Employees continue to accrue statutory holiday during garden leave because the employment contract remains in force. Employers may require employees to take outstanding leave during garden leave, provided they follow the statutory rules for holiday direction and notice.
Restrictions on Starting New Work
Because the employee remains under contract during garden leave, they are usually prohibited from starting work with another employer or engaging in other employment that conflicts with their contractual duties, unless the employer waives this restriction.
Practical Issues in Redundancy Processes
Timing and Consultation
Placing an employee on garden leave before a redundancy consultation is concluded can potentially affect the fairness of the redundancy process. The Employment Appeals Tribunal has observed that isolating an employee too early can hinder their ability to engage meaningfully in consultation, which may be relevant to tribunal assessments of fairness.
Handover and Availability
During garden leave, an employer may require the employee to support handover activities or answer reasonable questions about ongoing work. This preserves continuity and protects business interests without requiring attendance at the workplace.
Restrictive Covenants
Garden leave often works alongside restrictive covenants in the contract. These can limit the employee's ability to compete or solicit clients after the contract ends. A well‑drafted garden leave clause can make post‑termination covenants more enforceable by keeping the employee bound by some obligations during notice.
Risks and Legal Considerations
Contractual Risks
If a contract lacks a garden leave clause, and the employer insists the employee remain away from work, a tribunal or court may find that the employee has a contractual right to work. In such cases, enforcing garden leave without a contractual basis could result in breach of contract or constructive dismissal claims.
Duration of Garden Leave
Garden leave should not be unreasonably long. If the period exceeds what is necessary to protect the employer's legitimate interests (for example, exposure to confidential information), courts may consider it unreasonable, and the clause could be challenged.
Communication and Fairness
Employers should manage communication and consultation carefully if garden leave is used during redundancy. Poor communication or a perceived predetermination of redundancy decisions can give rise to claims that the consultation process was unfair.
Common Questions About Garden Leave and Redundancy
Can an employee be placed on garden leave without a clause in the contract?
Generally no. Absent an express garden leave clause, placing an employee on leave can breach their contractual right to work unless the employee agrees.
Does garden leave replace notice?
No. Garden leave is typically a form of serving notice. It operates during the notice period rather than replacing it and therefore preserves the employee's contractual rights until the end of notice.
Will redundancy pay be reduced by garden leave?
No. Statutory redundancy pay is calculated independently of garden leave and is based on age, service and pay.
Can an employee start a new job during garden leave?
Not normally without the employer's permission, because the employee remains under contract and is subject to the terms of that contract.
Key Takeaways
Garden leave allows an employer to manage an employee's exit during redundancy by maintaining the contract and pay while removing the employee from day‑to‑day duties. It protects business interests, especially where sensitive information or key client relationships are involved. For garden leave to be lawful, it should be supported by a clear contractual clause. During garden leave, employees continue to receive pay and benefits, accrue statutory rights including redundancy and holiday entitlements, and remain bound by contractual obligations. Employers must be mindful of fairness in redundancy consultation processes and ensure contractual terms are enforceable to avoid breach of contract or unfair dismissal claims.
