Garden leave is a period after you resign or are fired when you're still employed and paid, but you don't have to work and can't work for competitors. It typically lasts weeks or months and is used by employers to stop you immediately helping a rival company with confidential knowledge. For example, a bank might put a departing investment banker on garden leave for three months so they can't immediately move to a competitor and use insider knowledge. The legal principle is that employers can restrict your freedom to work, provided they pay you and the restriction is "reasonable." In the UK, courts will enforce garden leave if it's not excessive; in the US, it's less common but still used.
Garden leave is actually relatively employee-friendly because you're paid to do nothing, so don't fight it too hard. However, negotiate the length—anything over three months is excessive for most roles. Also clarify what you're allowed to do during garden leave (can you take another job? study? consult?), because some employers try to ban all outside work. If the garden leave period is long, ask for a signing bonus or extra pay to compensate for the restriction on your freedom. ---
Frequently Asked Questions
What does this clause mean in simple terms?
Garden leave is a period after you resign or are fired when you're still employed and paid, but you don't have to work and can't work for competitors.
Why should I care about this clause?
It typically lasts weeks or months and is used by employers to stop you immediately helping a rival company with confidential knowledge.
What are my options?
For example, a bank might put a departing investment banker on garden leave for three months so they can't immediately move to a competitor and use insider knowledge.
How does this affect small businesses?
The legal principle is that employers can restrict your freedom to work, provided they pay you and the restriction is "reasonable." In the UK, courts will enforce garden leave if it's not excessive; in the US, it's less common but still used.