Garden leave or Gardening leave is where your employee is not required to attend the workplace but continues to receive their full pay for the duration of their notice period. A garden leave clause is outlined in employment contracts and is enforceable when an employee resigns or is terminated and is required to stay away from the office. The employee does not need to perform their duties during this notice period.
What is garden leave in Australia?
Garden leave is when an employee leaves a job and is required to stay away from work during their notice period. They receive their full pay and can work from home or not at all.
It is a precautionary measure taken by employers to protect confidential information. It does not indicate mistrust or that the employee has committed some indiscretion but is a measure to ensure company information is protected.
Why is it called Garden/Gardening Leave?
As the employee cannot take up work elsewhere or work from home, they have time to take up hobbies (such as gardening) while getting paid. It is called garden leave, gardening leave, or gardener’s leave.
Do all employers need garden leave clauses?
It depends on your business and security measures and the information you possess. Garden leave allows you to change or remove the employee’s access to confidential information. This can include financial information, account details, credit card access, client details, etc. Similarly, you can include a no-compete clause or restraint of trade clause in the employment contract which prevents employees from leaking or sharing information with competitors.
Benefits of a garden leave clause
Having an employment contract that consists of a garden leave clause can benefit you and your business. If you are hiring an executive or manager who has access to sensitive information, a garden leave clause is essential.
Other benefits include:
Protects essential client information
Allows you to manage and control access to all information and systems
Creates a period in which the former employee cannot work for competitors
Ensures you part ways on good terms
Ensures the employee can work from home or other locations and continue getting paid
Prepare for all eventualities
If the separation is due to a hostile situation, it allows for both parties to separate without creating financial complications
Things employees need to remember
The employment agreement must set out clear terms for employees to follow during their garden leave.
Some things employees need to remember:
They must abide by the terms of the employment agreement
They must be contactable during the notice period
They cannot work for another employer during the notice period
They continue to receive pay
They may receive holiday pay and sick leave if outlined in the contract
They cannot be placed on gardening leave indefinitely or for an extended period
They cannot be forced to go on garden leave.
Grow with Employsure
If you require further assistance with understanding different types of leave and how they impact your business, you can reach out to Employsure. We have worked with 30,000 businesses across Australia and New Zealand in matters of employment relations. You can call our 24/7 Advice Line today to get all your tricky questions answered.
Frequently Asked Questions
Is garden leave legal in Australia?
Garden leave is legal if the employment contract includes garden leave and the employee understands the clause and its implications. This will prevent any legal issues from arising.
Can I force an employee to take garden leave?
You cannot force any employee to take garden leave.
You can request an employee to take garden leave, if the clause is included in their employment contract.
Should I have a garden leave clause in my employment contract?
If you’re an employer, including a gardening leave clause in the employment contract is not mandatory but can help protect you and your business. It acts as a safeguard for the interests of your business and clients.
When can garden leave be typically used?
Garden leave is typically used during the notice period of an employee resigning or if you end the employment of a staff member.
What should I remember when placing an employee on garden leave?
You must remember to make it clear that you are not punishing your employee by placing them on garden leave. You should also remember to discuss it with them prior to placing them on garden leave.
This document is intended to act as general information. It does not constitute professional advice.
