What is gardening leave? How is it tied to non-compete clauses? Is garden leave the same as being fired? Today I'll be answering these questions.
Most often, garden leave — or gardening leave, depending on your dialect — is the terminal period where you’re technically still employed, but kept away from the workplace.
Alternatively, garden leave can be used as a euphemism for suspending employees with pay.
Garden leave is chiefly found in the UK, New Zealand, and Australia. It's practically unheard of in the US, which is why the term caught my attention.
Garden leave draws parallels with non-competition clauses. It ensures employees are not rushing to competitors with the latest proprietary information by instead letting them cool off with no access to working data.
In an ordinary case, garden leave begins shortly after an employee turns in their resignation notice — or when it is provided to them. The worker turns in their company equipment, namely computers and phones. Then they sit back, collect their salary and benefits, and wait for their employer to ask them parting questions.
Note that garden leave tends to be used with important persons. Executives, fellows, and other seniors. It's uncommon for lesser employees to be placed on garden leave, for some reasons outlined below.
Why Do Employers Use Garden Leave?
Besides the overt reason of preserving company secrets, employers deploy garden leave to prevent intentional or unintentional sabotage.
Sabotage comes in many forms, such as dragging down employee morale; causing HR incidents; stealing clients or vendors; or interfering with business operations. You don’t want a rogue operator breaking your systems, or a vengeful sales expert walking off with all your customers.
Another reason garden leave is used is to ensure that a worker is out of the market for a time. If you give them a cash settlement and let them leave immediately, then they can be snatched up by competitors.
Whilst they’re out of the market, they’re also still employed — so the employer can continue to consult the worker and use the garden leave employee for tasks.
Such a leave can get expensive, as they must dole out salary and benefits. Though employees on garden leave usually won’t receive bonuses. This reduces the likelihood of companies using garden leave for low level employees – it's too dang expensive.
What About Non-Compete Clauses?
Without delving deeply into the mess that is contract law, non-compete clauses are hard to enforce. Which means it’s often as good as no protections at all.
That’s why gardening leave is handy: the employer retains the employee and thus has more influence over them. Gardening leave takes more space in a worker's mind than a non-compete clause, and there's salary on the line for complying.
Furthermore, employees are still bound by terms of employment, including the duty of confidentiality.
That won't always stop someone from ignoring garden leave and going straight to a new job with a competitor. That's always a problem with employment rights being what they are.
In places where garden leave is established, the employer could sue for damages. Yet litigation is always a costly and lengthy affair. Which means that often, employers will opt to simply let workers get away with their breaches of contract.
Is Garden Leave the Same as Suspension?
Sometimes garden leave is used euphemistically to place a problematic employee in time-out, or to drop them slowly.
Problematic is a rich word in this context. It can mean an employee who is causing public relations problems for the company, and thus disappears on leave until the outrage dies down.
It can also mean an employee going on terminal leave who is hostile, such as when they're fired. They are removed from the workplace so as to not affect other workers, and stripped of access to company resources.
It is sometimes hard to distinguish between amicable partings with garden leave, and suspension with pay. Thus the rumour mill can get rolling, especially when C-suite executives are placed in the garden.
Despite sounding cosy, garden leave carries that implication of suspension. The optics aren't great, hence getting the rumour mill going.
It can also be frustrating to wait out the leave period when you're ready to move on to the next job already.
Yet really, most garden leave is routine for terminating VIPs. There's nothing special going on except precautionary measures.
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