garden leave

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Garden Leave is a stipulation that can be interpolated into a Contract of Employment. In essence such a clause states that where employment has ceased, the employee may be informed to stay away from work during their notice period, while still remaining firmly on the payroll of the company. This can occur if either the employee resigns, or his/her employment is terminated.
In this essay I will look at how this concept can benefit an employer, but also what rights the employee has when it comes to the latter.

Benefits of Garden leave for the Employer

The first and most crucial benefit of garden leave for the employer is that, by inserting this clause into a contract of employment, their legitimate interests are being protected, particularly if the said employee is leaving to join a competitive business. This can mean that the employee would be obligated not to attend the working premises. Furthermore it would restrict the employee from making contact with any of the employer’s staff or client base. Essentially, this entitles the employer to hold a definite balance of power, as the employee is still restricted to follow the contractual obligations laid out. For example they could be bound to the duty of confidentiality. It can also be of benefit to the employer in that they can prevent the employee from gaining access to information which is sensitive in nature. It is essential to note that the employer can request the employee to return to work at any period throughout his/her gardening leave. It should also be noted that the employer is also obligated to follow his/her contractual obligations, meaning they still have to provide full pay and benefits for the employee on garden leave.

The case of JM Finn & CO LTD v Holliday i...

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...iliarity with their dealings, and one which has demonstrated strong levels of commitment in the transition of their business to another accredited member of the enterprise.

Another instance where Garden leave is beneficial to the employer, is instances where managers or persons in an executive capacity, have access to the strategic plans of the company. It could be argued that high salaries could act as a deterrent to avoid having to use garden leave clauses in the first place. Ethics suggests that even former employees are bound to the duty of confidentiality to forbear disclosure of the company’s confidential information. However, common sense would dictate that this cannot be extensively relied on. It is in this regard garden leave could be a useful tool in delaying the competitor from availing of the credible knowledge and expertise of the resigning employee.

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