The term “garden leave” refers to the practice of an employee being sent on paid leave for a predetermined length of time as a disciplinary measure.
The leave period is a means of temporarily relieving the employee from duty while also preventing him or her from having any contact with customers, coworkers, and/or company property.
What Does Garden Leave Mean for Employees?
Being placed on garden leave does not mean that an individual has been officially fired from their job. In fact, if the leave clause is included in a contract, then it may be possible for an employee to return to work after their leave period ends.
Being sent on garden leave means you will not be allowed to perform your duties while still receiving your usual salary during the stipulated leave period.
Depending on the length of leave, this may also mean that you are cut off from office activities such as email, phone calls, meetings with coworkers, company events, etc.
What Does Garden Leave Mean for Employers?
Garden leave is not something that an employee asks for; rather, garden leave is meant to be used as a disciplinary measure by employers against employees whose conduct or behavior has breached company policy in some way.
This policy is useful for employers as a means to remove an employee from the office while ensuring that he or she will not use company resources to further his or her own agenda.
In addition, this is also offered as a way for an employer to protect themselves during the term of an investigatory process.
This protection is particularly important if there are questions about what employees can do or say while they are still employed by the company since garden leave prevents them from having any contact with customers, coworkers, and/or company property.
Employees Rights and Obligations
An employee should ask to be paid while they are on garden leave since this will still be their full-time salary and they will not be able to earn any money from other sources.
Employees can still use up any company holidays or sick days, but they are only entitled to public holidays where they work. However, an employee may not be able to receive bonus or commission pay during the leave period.
Moreover, the employee is required to hand over all company-issued equipment such as keys, access cards, or security passes, phones, and laptops they were using before the garden leave began.
It is also necessary that the employee is prohibited to access company IT systems, company property, or data of any kind.
While on leave, they are also required to notify the employer of their home address and any changes made to this during garden leave.
What Happens if I Don’t Take Garden Leave?
If garden leave has been offered and accepted as part of a negotiated agreement, then refusing to take the leave or not following through on the agreement can result in disciplinary action.
Further, an employee may find themselves vulnerable to termination if they refuse to take the leave period under such circumstances.
However, employers must make sure that garden leave is reasonable and does not result in serious disruption to the company.
In addition, garden leave must also be reasonable in terms of when it is offered and for how long.
How To Negotiate Garden Leave With Your Employer
An employee being placed on garden leave should have already breached company policy to some extent, so this should not be a battle worth fighting. However, it may be worth trying to negotiate the leave period for a shorter duration of time.
Any leave agreement should be negotiated directly between you and your employer before any disciplinary action is taken against you.
If an employee is given leave without requesting it, the garden leave agreement must be signed within 7 days of receiving it (unless otherwise stated).
If the garden leave agreement is not signed within 7 days, the agreement will automatically come to an end.
If you do not sign the agreement and your employer contacts you to ask why, they must give you another 14 days (starting from when they contacted you) to respond before any disciplinary action can be taken against you.
In some cases, the agreement may be accompanied by a mutual non-disparagement clause which prohibits both parties from making any negative remarks about the other party during the leave period and beyond.
In addition, agreement may also include a clause that prevents the employer from hiring a replacement during the garden leave period.
Before the leave clause was agreed upon, ensure that all company policies were read and understood by you. It is important to be aware of your garden leave and ensure that this does not impact you negatively in any way.
When Can You Return to Work After the Garden Leave Has Ended?
An employer can require the leave period to continue until a certain investigation or legal process is complete, but they cannot force an employee to stay away from the workplace for an unlimited amount of time.
If garden leave is for a long period of time, it may be necessary to consider taking legal action against your employer in order to challenge the leave or force them into arbitration (if you have signed an agreement).
Problems That Can Arise From Using Garden Leave and How To Deal With Them
There is a risk of the leave period continuing indefinitely, which means employees may never return.
This can be avoided by demanding garden leave for a short period and specifying when you expect to return (or if it will be terminated automatically on the basis of an investigation or legal process).
If the leave is misused, employees should consider taking legal action against their employer.
When the leave period without pay overlaps with a period of sick leave, it may be possible to claim unfair dismissal and discrimination on the basis of Disability Discrimination and Employment Protection Act Part IV.
Pros and Cons
– An employee can still be paid for garden leave, even though they are away from work.
– The employer may not hire someone else to replace the employee during the garden leave period.
– This is a way to protect both parties in case there is a legal matter that needs to be handled by the company.
– This can lead to serious financial difficulties if the leave continues for a long period of time (unless the employee is still getting paid).
– The employee may be prevented from working at another company during garden leave.
– A mediator or arbitrator may need to be brought in which can lead to additional costs.
The garden leave clause was initially designed to protect both the employer and the employee. However, more cases are emerging where this is being abused by employers.
Employees who are on garden leave for any significant amount of time should consider challenging their garden leave through legal action or arbitration if possible, as it can be used to force an end to garden leave early.
Moreover, there are some serious financial difficulties associated with garden leave if this continues for a long enough period of time, so it is important to have an exit plan in place in case the leave period drags on for months at a time.
About the Author
True Tamplin, BSc, CEPF®
True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.
True is a Certified Educator in Personal Finance (CEPF®), contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.