Company Name:
Effective Date:
Policy Owner:
Approved By:
Maximum Garden Leave Duration:
1.1 This policy establishes a structured framework for the use of garden leave as a tool for managing the transition of departing employees during their contractual notice period. Garden leave requires the employee to remain away from the workplace and abstain from performing their duties while continuing to receive full salary and benefits until the expiration of the notice period. The primary objectives of this policy are to protect the Organization's confidential and proprietary information, trade secrets, and client relationships during the period between an employee's resignation or notice of termination and their actual departure, to prevent the departing employee from immediately joining or assisting a competitor during the notice period, and to facilitate an orderly transition of duties and responsibilities while maintaining the employee's contractual rights to compensation and benefits.
1.2 This policy applies to all employees of the Organization whose employment agreements, offer letters, or supplementary restrictive covenant agreements contain a garden leave clause, as well as to any departing employee where the Organization determines, on a case-by-case basis, that garden leave is necessary and appropriate to protect legitimate business interests. Garden leave is most commonly applied to employees in senior management, commercial, client-facing, or strategically sensitive roles who have access to confidential business information, trade secrets, customer data, or competitive intelligence. The Organization reserves the right to place an employee on garden leave regardless of whether the separation is initiated by the employee through resignation or by the Organization through termination, provided that the employee's contract or applicable law permits such an arrangement. The HR department shall consult with Legal Counsel before placing any employee on garden leave to confirm the legal basis and enforceability of the arrangement.
1.3 The decision to place a departing employee on garden leave shall be made on a case-by-case basis and shall require the joint written approval of the employee's Division Head, the Head of Human Resources, and Legal Counsel. The approving authorities shall consider the employee's level of access to confidential or competitively sensitive information, the nature of the employee's role and the risk that their immediate departure poses to client relationships or ongoing projects, the destination of the departing employee, including whether they are joining a direct competitor, the enforceability of the garden leave provision under the applicable jurisdiction's employment law, and the cost to the Organization of maintaining the employee on full pay during the garden leave period. The HR department shall prepare a garden leave recommendation memorandum for the approving authorities that documents the business justification, risk assessment, proposed duration, and terms of the garden leave arrangement.
2.1 During the garden leave period, the employee shall continue to receive their full base salary, contractual benefits, pension contributions, and any other compensation elements specified in their employment agreement, paid at the normal intervals and through the normal payroll process. The employee remains a full employee of the Organization for the duration of the garden leave period and continues to be bound by all obligations under their employment agreement, including confidentiality, non-disclosure, exclusivity of service, and duty of fidelity. Accrued leave and other entitlements shall continue to accrue during garden leave unless the Organization directs the employee to utilize accrued leave during the garden leave period, which shall be communicated in the garden leave notification letter. The employee's tenure and service continuity shall not be interrupted by the garden leave period for the purposes of calculating final settlement, severance, or post-employment benefits.
2.2 During garden leave, the employee shall not attend the Organization's offices, premises, or any client sites, access or attempt to access any Organization IT systems, email accounts, networks, cloud applications, or data repositories, contact or communicate with any clients, customers, suppliers, partners, or prospects of the Organization for business purposes, contact or solicit any employees or contractors of the Organization, perform any work for the Organization unless expressly requested in writing by the HR department, or take up employment, consultancy, or any business engagement with any other entity without the prior written consent of the Organization. The employee shall remain available to the Organization during normal business hours for reasonable requests related to handover, knowledge transfer, or responding to queries about ongoing matters, and shall attend any meetings or provide any information reasonably requested by the Organization during the garden leave period. All Organization property, including laptops, mobile devices, access cards, and documents, shall be returned on or before the first day of garden leave unless the Organization directs otherwise.
2.3 The Organization may, at its sole discretion, direct the employee to utilize a portion or all of their accrued but unused annual leave during the garden leave period, in accordance with applicable employment law and the terms of the employment agreement. Where the Organization exercises this right, the direction shall be clearly stated in the garden leave notification letter, specifying the number of leave days to be utilized and the dates on which they will be applied. The balance of the garden leave period beyond the utilized leave days shall continue to be treated as a period of employment during which the employee remains on authorised absence from the workplace. Where applicable law requires a minimum notice period before directing an employee to take annual leave, the Organization shall ensure that the notification provides sufficient advance notice. The employee shall not be required to utilize leave that would reduce their remaining entitlement below any statutory minimum that must be preserved.
3.1 The Organization shall provide the employee with a formal garden leave notification letter, delivered either in person or by recorded delivery, within 2 business days of the decision to invoke garden leave. The notification letter shall specify the start date and expected end date of the garden leave period, confirmation that the employee will continue to receive full salary and benefits, a detailed list of the restrictions and obligations that apply during garden leave, including prohibitions on attending the workplace, accessing systems, and contacting clients and colleagues, the requirement to return all Organization property by a specified date, the requirement to remain available during normal business hours for handover and knowledge transfer purposes, any direction to utilize accrued annual leave, and the consequences of breaching the garden leave terms. The notification shall be copied to Legal Counsel and the Finance department, and a signed acknowledgement shall be obtained from the employee.
3.2 Before the commencement of garden leave, or within the first 5 business days of the garden leave period where immediate placement is necessary, the employee's direct manager shall ensure that a structured handover of the employee's responsibilities is completed. The handover shall cover the transfer of all ongoing projects, deliverables, and client or stakeholder relationships to a designated successor or interim owner, the documentation and filing of all critical information, records, passwords, and process notes, the return of all Organization property including laptop, mobile phone, access badges, keys, credit cards, and any confidential documents or data in the employee's possession, and a briefing to relevant team members and clients, coordinated by the manager, regarding the transition of responsibilities. The IT department shall disable the employee's remote access to all Organization systems on the first day of garden leave, while preserving the employee's email and data for the Organization's use during the transition period.
3.3 Following the commencement of garden leave, the employee's manager, in coordination with the HR department and any relevant commercial or account management leaders, shall communicate the employee's transition to relevant internal stakeholders, team members, and, where appropriate, key clients and external partners. The communication shall be factual, professional, and designed to maintain confidence in the continuity of service and the strength of the Organization's team. The communication shall not disclose the specific terms of the garden leave arrangement or the reasons for the employee's departure beyond what is necessary and appropriate. A designated point of contact shall be identified for each key client or stakeholder to ensure seamless continuity. The HR department shall provide managers with approved communication templates and talking points to ensure consistency and to avoid any statements that could prejudice the Organization's legal position or the employee's reputation.
4.1 Any breach of the garden leave terms by the employee shall be treated as a serious breach of the employment agreement and may result in immediate disciplinary action, including summary termination without further notice or payment in lieu of notice, cessation of salary and benefits from the date of breach, the Organization seeking injunctive or interim relief from a court of competent jurisdiction to restrain the employee from continued breach, a claim for damages arising from the breach, including loss of client revenue, competitive harm, and any costs incurred in obtaining legal remedies, and enforcement of any post-employment restrictive covenants from the date of the breach rather than from the originally scheduled end of the notice period. The HR department shall work with Legal Counsel to monitor compliance with garden leave terms and to respond swiftly to any suspected or reported breach. Evidence of breach shall be documented and preserved for use in any subsequent legal proceedings.
4.2 The Organization shall take reasonable and proportionate steps to monitor compliance with the garden leave terms, consistent with applicable privacy laws and the terms of the employment agreement. Monitoring measures may include periodic check-in calls or emails between the HR department and the employee to confirm compliance and availability, monitoring of the employee's publicly visible professional activity, including LinkedIn updates, industry event attendance, and public announcements, maintaining communication with key clients and partners to identify any unauthorised contact by the employee, and reviewing access logs if there is reason to believe the employee has attempted to access Organization systems remotely. All monitoring activities shall be conducted in compliance with applicable data protection and privacy regulations, and the employee shall be informed of the Organization's monitoring rights in the garden leave notification letter. The HR department shall maintain a log of all monitoring activities and findings for each garden leave case.
5.1 Upon the expiry of the garden leave period, the employee's employment shall terminate automatically on the last day of the contractual notice period. The effective date of termination for all legal and administrative purposes shall be the last day of the notice period, regardless of when the employee was placed on garden leave. The HR department shall process the employee's exit in accordance with the Organization's standard exit procedures, including the issuance of a formal relieving letter, experience certificate, and all required tax and statutory documents within 30 calendar days of the termination date. The final settlement, including any remaining salary, accrued leave encashment, and pro-rated entitlements, shall be calculated and paid within 30 calendar days of the termination date. Post-employment restrictive covenants, including non-compete and non-solicitation obligations, shall take effect from the termination date as specified in the employee's employment agreement.
5.2 This policy shall be reviewed comprehensively at least once every 12 months by the policy owner, in consultation with Legal Counsel and the executive leadership team, to ensure that garden leave provisions remain legally enforceable under the employment law of all jurisdictions in which the Organization operates and are aligned with current business needs and competitive dynamics. An interim review shall be triggered by material changes in employment or contract law affecting garden leave enforceability, a court ruling or regulatory guidance in any relevant jurisdiction that impacts the Organization's ability to impose or enforce garden leave, feedback from departing employees, managers, or Legal Counsel regarding the practical effectiveness of the policy, or a breach of garden leave that reveals gaps in the policy's terms or enforcement mechanisms. All amendments shall be approved by the Head of Human Resources and the Chief Executive Officer, and shall be reflected in updated employment agreement templates for new hires and, where contractually permissible, communicated to existing employees.
A garden leave policy defines the terms under which departing employees serve their notice period away from the workplace while remaining on the Organization's payroll. During garden leave, the employee is relieved of their duties but remains bound by their employment contract, including confidentiality and non-compete obligations.
Garden leave is commonly used for senior employees, those with access to sensitive information, or employees departing to join a competitor. It provides a buffer period that allows confidential information to become stale while ensuring the employee continues to receive their salary and benefits.
Garden leave serves three primary purposes: protecting confidential information, preventing competitive harm, and ensuring a smooth transition. By removing the departing employee from the workplace during their notice period, the Organization limits their access to current strategies, client relationships, and trade secrets.
Garden leave is also an alternative to placing the employee on immediate termination, which can create legal and financial complications. During garden leave, the employee remains employed, which means non-compete and non-solicitation clauses remain in full effect.
An effective garden leave policy covers triggering criteria, duration, compensation and benefits during leave, restrictions on the employee (no work for competitors, no client contact), the Organization's right to recall the employee, and the interaction between garden leave and post-employment restrictive covenants.
The policy should clarify that garden leave is at the Organization's discretion and specify the categories of employees to whom it typically applies.
Customize this template with your Organization's garden leave triggers, duration, and restrictions. Ensure that garden leave provisions are referenced in employment contracts and that the Organization's right to impose garden leave is contractually established.
Review with legal counsel to ensure enforceability in your jurisdiction. Export as PDF or DOCX and include in the employee handbook and offer letter templates.