Garden Leave Clause in UK Contracts: What It Means & Example Wording

When to Include a Garden Leave Clause

• In employment contracts for senior employees, directors, or anyone with access to sensitive information who might join a competitor
• When an employee has close relationships with key clients and the employer wants to distance them from those clients before they leave
• As an alternative or complement to post-termination restrictive covenants — garden leave is generally easier to enforce because the employee continues to be paid

Example Wording

This example wording is illustrative only. Customise it to your specific circumstances and consider seeking legal advice.

Is a Garden Leave Clause Enforceable in the UK?

Garden leave clauses are enforceable in the UK provided they are expressly included in the employment contract. Without an express clause, an employer who unilaterally places an employee on garden leave may be in breach of the implied term to provide work (particularly for employees whose roles require them to exercise skills or maintain a public profile). Courts have upheld garden leave as a reasonable means of protecting legitimate business interests. In William Hill Organisation Ltd v Tucker [1999], the Court of Appeal held that garden leave cannot be imposed without a contractual right. The duration of garden leave may also be taken into account when assessing the reasonableness of post-termination restrictions.

Common Mistakes

• Placing an employee on garden leave without an express contractual right to do so — this may constitute a breach of contract
• Failing to continue full pay and benefits during garden leave — the employee must receive everything they would normally be entitled to
• Not accounting for garden leave when setting the duration of post-termination restrictive covenants — courts may reduce the enforced period of a non-compete to reflect time already served on garden leave