If your business has worked long and hard to develop a commercial competitive advantage, you will want to protect this at all costs. Sometimes the imminent departure of a senior member of staff can place this at risk, especially if you suspect they plan to move to a competitor. One option to consider is placing them on ‘garden leave’. Garden leave is typically reserved for those in senior positions and with specialist knowledge. For example, the chief aerodynamicist for a highly successful Formula One team was recently placed on garden leave before his move to a competitor. In a world where competitive advantage through technology is everything, placing a member of staff with substantial inside knowledge on garden leave makes strong commercial sense.
What is garden leave from work?
An employee is placed on garden leave when they are due to end their employment, either because they have chosen or have been asked to leave, and the employer wants to keep that person from working for a period until their contract ends. Typically this means the employee will be asked not to go to work or work from home. Those given garden leave still receive their normal pay and contractual benefits.
Employers use garden leave for a couple of key reasons, including preventing departing staff from:
- gathering more information in the workplace which they can use to their own advantage or that of a competitor in the future
- influencing other staff members within the organisation
- switching to a competitor early
The primary purpose of using garden leave is to prevent the employee from entering the marketplace for a sufficient amount of time so that any information that they possess will effectively go ‘out of date’, meaning a competitor cannot use it to their commercial advantage.
Do you accrue annual leave on garden leave?
Yes, employees on garden leave are still employed, hence they continue to accrue annual leave. This does not mean that you can go on holiday while on garden leave, however. This is because you remain employed and may still be required to complete work-related tasks before you go.
Under section 15 of the Working Time Regulations 1998, your employer may require you to take annual leave while on garden leave, as long as sufficient notice is provided.
Final words
Garden leave can provide a useful way to protect the commercial interests of an employer, but it must be implemented in accordance with employment law. If you need any assistance with garden leave, speak to an employment law Solicitor who will be able to provide specialist advice tailored to your needs.
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