Employment Contract Template with Garden Leave Clause (UK 2025)
Last updated: February 2025
When You Need This Contract
Garden leave clauses require an employee who has given or received notice to remain at home and not attend the workplace or contact clients during their notice period, while continuing to receive full pay and benefits. This is a powerful tool for protecting business interests during the transition period, preventing the departing employee from accessing confidential information, contacting clients, or working for a competitor before their notice period expires. The clause must be carefully drafted to be enforceable.
Key Clauses
- Express contractual right to place the employee on garden leave
- Full pay and benefits continuation during the garden leave period
- Obligations during garden leave including availability and non-contact
- Interaction with post-termination restrictive covenants
- Return of company property at the commencement of garden leave
What to Watch Out For
- Not including an express contractual garden leave clause, which means you may not have the right to exclude the employee from the workplace
- Failing to address how garden leave interacts with post-termination restrictions, specifically whether the garden leave period counts towards the restriction period
Sample Clauses
- Sample garden leave clause: 'The Company may, at any time during your notice period, require you to remain away from the workplace on garden leave. During garden leave, you will continue to receive your full salary and contractual benefits. You must remain available during normal working hours, not contact customers, clients, or suppliers, not attend any other workplace, and comply with all ongoing contractual obligations.'
- Sample interaction clause: 'Any period of garden leave served shall count towards the duration of any post-termination restrictive covenants in this agreement. For example, if you serve 3 months of garden leave and have a 6-month non-compete, the remaining non-compete period after your employment ends shall be 3 months.'
FAQ
Is garden leave enforceable without an express contractual clause?
Without an express clause, placing an employee on garden leave may breach the implied term that the employer will provide work, potentially amounting to a repudiatory breach that the employee can treat as constructive dismissal. Always include an express garden leave clause in the employment contract. With a proper clause, the employer has a clear contractual right to invoke garden leave during the notice period.
Does time spent on garden leave reduce the post-termination restriction period?
Courts have held that garden leave can reduce the enforceability of lengthy post-termination restrictions, as the employee has already been restricted during the notice period. Best practice is to include a clause in the contract expressly stating that garden leave counts towards the duration of post-termination restrictions. This is also fairer to the employee and makes the overall restriction more likely to be upheld as reasonable.
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