Garden leave requires employees to stay away from work during their notice period while remaining employed, whereas a standard notice period allows employees to work or take accrued holiday.
Key Takeaways
- Garden leave keeps employee employed but away from work during notice
- Standard notice period allows employee to work or take leave
- Both require payment of normal wages and benefits
- Garden leave must be reasonable and agreed in contract
- Holiday continues to accrue during both garden leave and notice period
What Is Garden Leave
Definition
- Employee remains employed - during notice period
- Required to stay away - from work and clients
- Continues to receive pay - normal wages and benefits
- Cannot work for others - during garden leave period
- Must remain available - for employer if needed
Legal Basis
- Contractual provision - must be in employment contract
- Reasonable period - duration must be reasonable
- Mutual obligations - employer pays, employee stays away
- Enforceable - if reasonable and agreed
What Is a Notice Period
Definition
- Employee works - during notice period
- Normal duties - unless employer directs otherwise
- Continues to receive pay - normal wages and benefits
- Can take accrued holiday - during notice period
- Transition period - handover work to successor
Legal Basis
- Statutory notice - minimum period by law
- Contractual notice - longer period agreed in contract
- Mutual obligations - employer provides work, employee performs it
- Enforceable - if reasonable and agreed
Key Differences
| Aspect | Garden Leave | Notice Period |
|---|---|---|
| Employee works | No | Yes |
| Stays away from work | Yes | No |
| Pay continues | Yes | Yes |
| Benefits continue | Yes | Yes |
| Holiday accrues | Yes | Yes |
| Can take holiday | Limited | Yes |
| Can work elsewhere | No | Usually yes |
| Must be in contract | Yes | Yes |
Garden Leave
When Used
- Confidential information - employee has access to sensitive data
- Client relationships - employee has close client contacts
- Competitive threat - employee may join competitor
- Strategic reasons - employer wants immediate removal
Advantages for Employer
- Protects business - prevents access to sensitive information
- Maintains control - employee remains employed
- Prevents competition - stops employee working for rival
- Smooth transition - allows time for handover
Advantages for Employee
- Paid leave - continues to receive normal pay
- Time to prepare - can focus on new role
- No work stress - relieved of duties during notice
- Benefits continue - insurance, pension, etc.
Reasonable Duration
What Is Reasonable
- Role seniority - senior roles may have longer garden leave
- Access to information - sensitivity of data accessed
- Client relationships - depth of client contacts
- Industry norms - typical periods in sector
- Contract terms - what was agreed
Common Periods
- Junior roles - 1-3 months
- Middle management - 3-6 months
- Senior roles - 6-12 months
- Executive roles - up to 12 months
Holiday During Garden Leave
Accrual
- Holiday continues to accrue - during garden leave
- Statutory entitlement - maintained throughout
- Contractual entitlement - maintained throughout
- No reduction - holiday not lost during garden leave
Taking Holiday
- Can request - to take holiday during garden leave
- Employer can require - employee to take holiday
- Notice requirements - apply as normal
- Payment - holiday pay included in normal pay
Enforcement
For Employers
- Must be in contract - garden leave clause required
- Reasonable duration - period must be reasonable
- Pay must continue - normal wages and benefits
- Cannot revoke - once initiated, must be honored
For Employees
- Must comply - if contractually agreed
- Cannot work elsewhere - during garden leave
- Must remain available - for employer if needed
- Breach consequences - may lose pay or face legal action
Notice Period
Statutory Notice
- Minimum period - 1 week for each year of service
- Maximum - 12 weeks
- Increases with service - longer for longer service
- Both ways - employee and employer must give notice
Contractual Notice
- Longer than statutory - if agreed in contract
- Fixed period - e.g., 3 months regardless of service
- Senior roles - often longer notice periods
- Negotiable - can be varied by agreement
Holiday During Notice Period
Employee Rights
- Can request holiday - during notice period
- Accrued holiday - continues to accrue
- Payment in lieu - can be paid for untaken holiday
- Notice requirements - apply as normal
Employer Rights
- Can require holiday - employee to take holiday during notice
- Notice requirements - must give correct notice
- Business needs - can direct when holiday is taken
- Handover - may require work during notice
Managing Garden Leave
For HR Teams
- Check contract - ensure garden leave clause exists
- Assess reasonableness - duration appropriate for role
- Communicate clearly - inform employee of expectations
- Process pay - ensure normal pay continues
- Monitor compliance - ensure employee stays away
For Managers
- Handle sensitively - employee may be disappointed
- Protect information - restrict access to systems
- Plan handover - arrange work coverage
- Maintain contact - regular check-ins during garden leave
- Document everything - record all communications
Leave Management for Garden Leave
Effective management requires:
- Clear policy - documented garden leave procedures
- Contract clauses - garden leave provision in contracts
- Pay processing - ensure normal pay during garden leave
- Holiday tracking - monitor accrual during garden leave
- Compliance monitoring - ensure employee stays away
Compliance Checklist
- Garden leave clause in employment contract
- Reasonable duration agreed
- Normal pay continues during garden leave
- Holiday continues to accrue
- Employee informed of expectations
- Access to systems restricted
- Documented all communications
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