Garden leave, sometimes referred to as “gardening leave”, is a common feature of employment contracts in England and Wales, particularly for senior employees, directors, managers, sales staff, financial professionals, and individuals who have access to sensitive business information.

The term describes a situation where an employee remains employed during their contractual notice period but is instructed not to attend work, contact clients, access company systems, or carry out their usual duties. Although the employee is not working, they remain employed and continue to receive their salary and contractual benefits until their employment officially ends.

Garden leave is often used when an employee resigns to join a competitor, when a business wishes to protect confidential information, or during a senior employee’s departure from the organisation. While it may appear straightforward, garden leave raises important legal issues concerning contractual rights, restrictive covenants, notice periods, pay, and the enforceability of employment contract terms.

This article explains how garden leave works, why employers use it, the legal principles behind it, employee rights during garden leave, and what can happen if disputes arise.

What Is Garden Leave?

Garden leave is a period during which an employee remains employed but is not required to attend work or perform their normal duties.

The employee continues to receive:

• Normal salary.
• Pension contributions where applicable.
• Contractual benefits.
• Holiday entitlement.
• Other contractual rights that remain in force during employment.

The employment relationship continues throughout the notice period even though the employee is effectively absent from the workplace.

For example, a sales director with a six-month notice period may resign to join a competitor. Rather than allowing the employee to continue interacting with clients and accessing commercially sensitive information, the employer may place them on garden leave for the remainder of the notice period.

The employee remains employed and paid but does not continue working for the business.

Why Is It Called Garden Leave?

The phrase originated from the idea that an employee was being paid to remain at home rather than attending work.

Historically, the employee might spend the notice period tending to their garden while waiting for their employment to end.

Although the term remains widely used, modern garden leave typically involves restrictions on work activities rather than any expectation that the employee stays at home.

Why Do Employers Use Garden Leave?

Garden leave serves several important business purposes.

Protecting Confidential Information

Many employees have access to:

• Customer databases.
• Pricing information.
• Marketing strategies.
• Financial data.
• Trade secrets.
• Product development plans.

An employer may be concerned that a departing employee could use this information for the benefit of a competitor.

By removing access to company systems during the notice period, the employer reduces this risk.

Protecting Client Relationships

Businesses often rely heavily on long-standing customer relationships.

An employee who is leaving may have strong relationships with:

• Clients.
• Suppliers.
• Business partners.
• Key contacts.

Garden leave can prevent the employee from attempting to transfer those relationships to a competing organisation before their employment ends.

Maintaining Workplace Stability

The departure of a senior employee can create uncertainty within a workforce.

Employers may use garden leave to:

• Facilitate a smooth transition.
• Allow management restructuring.
• Avoid disruption among staff.
• Prevent conflicts arising during a notice period.

Delaying a Move to a Competitor

A lengthy notice period combined with garden leave can delay an employee’s ability to begin working for a competitor.

This gives the employer additional time to protect commercial interests and maintain client relationships.

Is Garden Leave Legal?

Yes.

Garden leave is generally lawful in England and Wales provided it is exercised in accordance with the employment contract and applicable legal principles.

Many employment contracts contain express garden leave clauses that permit the employer to:

• Require the employee not to attend work.
• Restrict contact with clients.
• Restrict contact with colleagues.
• Remove access to company systems.
• Reassign duties.
• Require availability if needed.

Where a valid contractual clause exists, courts will often enforce it if it is reasonable and designed to protect legitimate business interests.

Does There Need to Be a Garden Leave Clause?

In many cases, yes.

A well-drafted garden leave clause provides contractual authority for the employer to remove the employee from active duties while continuing to employ them.

Without such a clause, placing an employee on garden leave may create legal difficulties.

Certain employees may argue that exclusion from work breaches contractual rights, particularly where performing duties is a significant aspect of the employment relationship. This can be especially relevant in professions where maintaining skills, client relationships, or public visibility is important.

For this reason, employers commonly include detailed garden leave provisions within employment contracts.

How Does Garden Leave Differ From a Notice Period?

A notice period and garden leave are not the same thing.

A notice period is the period between notice being given and employment ending.

During a normal notice period:

• The employee continues working.
• The employee attends the workplace.
• Duties continue as normal.

During garden leave:

• The employee remains employed.
• The employee receives normal pay.
• The employee does not perform their usual work.
• Access to workplace systems is usually restricted.

Garden leave is therefore a specific way of managing all or part of a notice period.

Garden Leave and Payment in Lieu of Notice

Garden leave is often confused with Payment in Lieu of Notice (PILON).

They are different concepts.

Garden Leave

With garden leave:

• Employment continues.
• Salary continues.
• Benefits usually continue.
• The employee remains bound by contractual duties.

Payment in Lieu of Notice

With PILON:

• Employment ends immediately.
• The employer pays the notice period instead of requiring it to be worked.
• The employment relationship usually terminates at once.

The distinction can be important when considering restrictive covenants, holiday entitlement, pension rights, and future employment.

What Rights Does an Employee Have During Garden Leave?

Employees remain employed during garden leave.

As a result, they continue to enjoy many of the same rights that existed before garden leave began.

These rights typically include:

Salary

Employees must continue receiving normal pay throughout the garden leave period.

Contractual Benefits

Depending on the contract, benefits may continue, including:

• Company car arrangements.
• Private medical insurance.
• Pension contributions.
• Life assurance.
• Bonus arrangements.

Holiday Entitlement

Holiday entitlement generally continues to accrue while an employee remains employed.

Questions sometimes arise regarding whether holiday can be required to be taken during garden leave. The answer depends on contractual terms and statutory holiday notice requirements.

Protection From Unlawful Deductions

Employers generally cannot stop paying an employee simply because they are not attending work while on authorised garden leave.

The employee remains employed and entitled to contractual remuneration.

What Restrictions Apply During Garden Leave?

Although employees continue to receive pay, they remain subject to contractual obligations.

Common restrictions include:

• Not working for another employer.
• Not contacting clients.
• Not contacting suppliers.
• Not soliciting customers.
• Not accessing company systems.
• Maintaining confidentiality.
• Remaining available if requested.

Breaching these obligations may result in disciplinary action, legal proceedings, or claims for breach of contract.

Can an Employee Start a New Job During Garden Leave?

In many cases, no.

Because the employee remains employed during garden leave, they usually remain bound by contractual duties of loyalty and any exclusivity provisions contained within the contract.

Starting work for a new employer without permission may constitute a breach of contract. Whether this is permitted depends upon the specific contractual terms and any agreement reached between the parties.

Employees considering a new role during garden leave should carefully review their contractual obligations.

Garden Leave and Restrictive Covenants

Garden leave is closely connected to restrictive covenants.

Restrictive covenants are contractual clauses that limit certain activities after employment ends.

Examples include:

• Non-compete clauses.
• Non-solicitation clauses.
• Non-dealing clauses.
• Confidentiality obligations.

Employers often use garden leave and restrictive covenants together.

For example:

• Three months of garden leave may be followed by six months of post-termination restrictions.
• The combination can extend the period during which the employee cannot compete directly with the former employer.

Courts may examine the overall effect of these restrictions when determining whether they are reasonable and enforceable.

Can Employers Enforce Garden Leave Through the Courts?

Potentially, yes.

Where an employee breaches a valid garden leave provision, an employer may seek legal remedies.

In some cases, the courts may grant an injunction preventing the employee from:

• Joining a competitor.
• Contacting customers.
• Using confidential information.
• Acting in breach of contractual obligations.

Whether an injunction is granted will depend on the facts of the case and whether the restriction is considered reasonable.

What Happens If an Employer Misuses Garden Leave?

Garden leave is not unlimited.

An employer that acts outside the contractual terms may face legal challenges.

Potential disputes may involve:

• Breach of contract.
• Unpaid salary.
• Unpaid benefits.
• Constructive dismissal allegations.
• Injunction proceedings.

For example, if a contract contains no garden leave clause and the employer excludes an employee from work without lawful authority, the employee may argue that the employer has breached the contract.

Garden Leave During Redundancy

Garden leave is frequently used during redundancy exercises.

An employer may place an employee on garden leave while their notice period runs following a redundancy decision.

The employee generally remains entitled to:

• Notice pay.
• Contractual benefits.
• Holiday accrual.
• Statutory redundancy rights where eligible.

Being placed on garden leave does not remove statutory employment protections.

Time Limits for Employment Claims

Garden leave disputes may sometimes lead to employment claims.

Relevant time limits vary depending on the nature of the dispute.

Examples include:

• Unlawful deduction from wages claims.
• Breach of contract claims.
• Constructive dismissal claims.
• Unfair dismissal claims.

Many Employment Tribunal claims must normally be commenced within three months less one day of the relevant act or termination date, although different rules can apply depending on the claim involved.

Because limitation periods are strict, delays can affect legal rights significantly.

Common Questions from our Readers

Do I Still Get Paid During Garden Leave?

Yes. Employees on garden leave normally continue receiving their salary and contractual benefits because they remain employed.

Can My Employer Contact Me During Garden Leave?

Usually yes. Employers may require employees to remain available for reasonable business purposes, depending on the contract.

Is Garden Leave Mandatory?

Where a valid contractual clause exists, employers may often require employees to remain on garden leave. Whether it can be imposed depends on the contract and surrounding circumstances.

Does Holiday Continue to Accrue During Garden Leave?

Generally yes, because employment continues throughout the notice period.

Can Garden Leave Last for Several Months?

Yes. Senior employees often have notice periods of several months, and garden leave may continue for the whole notice period if permitted by the contract.

Summary

Garden leave is a contractual employment law mechanism that allows an employer to require an employee to stay away from work during their notice period while remaining employed and receiving full pay and contractual benefits. It is commonly used to protect confidential information, preserve customer relationships, prevent competitive harm, and facilitate orderly departures from a business.

The effectiveness of garden leave largely depends on the wording of the employment contract. Well-drafted garden leave clauses can provide employers with significant protection while balancing employee rights. Employees placed on garden leave generally continue to receive salary, benefits, and holiday entitlement, but they remain bound by contractual obligations, including confidentiality duties and restrictions on working elsewhere. Understanding how garden leave interacts with notice periods, restrictive covenants, redundancy, and employment disputes is essential for both employers and employees navigating the end of an employment relationship.