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What's 'garden leave' and how does it relate to resignations?

by , 30 August 2013
A resignation brings the employment contract to an end immediately, or at the end of the notice period, depending on what you accept. And this is where 'garden leave' comes in. Read on to find out what garden leave is and how it relates to your employee's resignation.

When your employee resigns, he must work out his notice period as stated in his employment contract.

The notice period allows you to find a replacement and ensures there's a smooth hand-over. This also ensures business continues without interruption, despite your employee leaving, says the Labour Law for Managers Loose Leaf Service.

When dealing with notice periods, one method you can consider using is to grant your employee 'garden leave'.

Has your employee resigned? Find out if you should give him 'garden leave'

If your employee has access to sensitive company information or client contracts and you're worried he'll disclose your confidential information during his notice period, you can agree with him that he won't come into the office during his notice period.

In this case, his employment will only finish at the end of his notice period, but he won't report for duty during his notice period and will be allowed to stay at home.

This sort of arrangement's often referred to as 'garden leave' because you're paying him to stay at home.

But, you can ask your employee to come to work anytime for meetings or any other tasks if you need him to. After all, he's still your employee and you're still paying his salary.

Here's an example of how 'garden leave' works

Ralph's a client manager for a large advertising agency. He's resigned to set up his own business.

Although he isn't bound by a restraint of trade agreement, the company doesn't want him to have access to its confidential information during his notice period. So, while Ralph stays employed for his notice period, he agrees not to report for duty during this time.

Well there you have it. Knowing when to grant 'garden leave' will help ensure you protect your business when your employee resigns.

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