Massachusetts passed a garden leave clause into law in , making it the first state to do so in the U. While the name gardening leave may sound pleasant—and in fact, an employee may sometimes prefer to serve their notice time relaxing at home rather than being in the workplace—the restrictive nature and negative implications of this leave can make it less than ideal. The garden leave helps protect an employer's interests when an employee tenders a resignation or is given a dismissal notice.
Gardening leave is a protectionist measure used by an employer when an employee is terminated or when they tender their resignation. Once in effect, it often prevents the employee from being involved in any work activity for their current employer, and typically restricts them from either taking on another job or working for themselves.
An employee is generally likely to spend their time pursuing hobbies such as gardening—hence, the term gardening leave. Salaries and benefits continue until the end of the leave period. Gardening leave is sometimes considered to be a euphemism for being suspended and can be perceived to have negative connotations such as the employee being unfit for anything other than tending to their garden.
The gardening leave is similar to a non-compete clause. Under this type of clause, an employee promises not to work for their current employer's competition for a specific period of time after their employment period is over. Following the resignation or dismissal of an employee, an employer may decide to place the employee on gardening leave. The primary reason for doing so is to safeguard against possible detrimental actions or behavior that the employee might indulge in during their notice period.
The employer may fear that the employee could become uncooperative, or that they may negatively influence the working environment and other employees. The employer may also prefer that the employee limit contact with clients for fear the employe may persuade clients to follow them to their new employer.
Placing an employee on gardening leave could help ensure that by the time the employee is contractually free, they would have been out of the loop long enough to reduce any possible threat. An employee is entitled to their salary and benefits during gardening leave, but depending on their employment contract, may not be eligible for bonuses or accrual payments.
The employee will usually be required to return company property such as laptops, smartphones, or vehicles during this period. While on gardening leave, the employee is required to be available if the employer requires information, support, or even to resume working.
For this reason, an employee should not plan to travel during gardening leave, unless approved by the current employer. An employer may also compel the employee to take any accrued holiday time during the period of gardening leave. An employer does not need to put a gardening leave clause in a contract during the on-boarding process when a new employee is hired, but they are recommended in certain cases.
Some contracts, especially those for senior management and other executives, often come with a well-drafted garden leave clause. If a company decides to put the leave in effect without one, it opens itself up to a breach of contract dispute. Signing a contractual clause may be problematic in some cases. Employees who don't receive a regular salary, and work on a bonus or commission basis may be able to dispute a clause since their incentive is based on their work activities.
These cases may result in disputes—even lawsuits—between both parties. Massachusetts passed the garden clause provision into law in mid, making it the first state in the United States to give workers paid leave after leaving a job, according to the Associated Press. If the employee in question has a company car, phone or laptop, whether you need to continue providing these will depend on whether they are a benefit, or a tool of employment, and whether you may require the employee to do anything work-related while they are at home.
Employees also continue to accrue holiday during garden leave, even though they are not attending work. You may be able to require them to take holiday during their notice period, but remember when calculating it you need to include holiday accrued to their actual termination date. Another example would be where working is necessary in order to maintain a professional level of skill, for example, in the case of surgeons or doctors, whereby forcing them to remain at home would deny them access to certain payments.
The old employer is faced with letting the matter pass or suing for damages, which is often a lengthy, complex and costly process. On balance a detailed contract clause, tailored to your business and its unique requirements, is usually a good idea. It avoids any breach of contract claim and also provides clarity for both parties on what garden leave will mean and what you as the employer are entitled to do in these circumstances. We regret we are not able to respond to requests for specific legal or HR queries and recommend that professional advice is obtained before relying on information supplied anywhere within this article.
These changes may make the information currently known to an ex-employee less valuable and possibly moot. As an employee being placed on gardening leave, you do have some significant obligations. These obligations include;. It depends on what is outlined in your employment contract.
Even though you may not be required to work, you will need to remain contactable by your employer. If you were to do so, it could be seen as a breach of contract.
The way for an employer to prevent any legal issues arising out of the gardening leave clause is to be sure the clause is properly written into the contract. The best way to ensure that a gardening leave clause is legal and enforceable, is to seek the advice of an employment lawyer prior to including the clause in the contract.
If you find yourself in need of assistance with this, or other post employment restraints , please contact the law offices of Owen Hodge Lawyers.
At Owen Hodge, we are always happy to assist clients in understanding the full ramifications of any and all of your legal needs. Please feel free to call us at your earliest convenience to schedule a consultation on Read More.
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