When should you put your Jersey employee on ‘garden leave’?
Garden leave or “gardening leave” can be a helpful device for Jersey employers who consider there is a need to protect their business from potential damage by an employee during their notice period. By placing the employee on garden leave he or she will no longer have access to the workplace, including access to company information, colleagues or clients and thus coupled with an effective restrictive covenant in their employment contract it should assist in reducing the risk to your business.
What is garden leave?
If an employee resigns, is made redundant or is dismissed from their position, an employer may choose to put them on garden leave, meaning that they will be requested to stop performing their regular work activities immediately and stay away from the workplace.
The employee will remain contracted by the business and as such, the employee will be bound to the terms and conditions of their employment contract during the garden leave. This means that they cannot take up alternative employment or do anything contrary to their employer’s interests until their notice period comes to an end. The employee will continue to receive a salary and contractual benefits in the usual way.
Should you put your Jersey employee on garden leave?
Depending upon the type of Jersey business, garden leave can be a useful protective measure to reduce the impact the leaving member of staff has on your business. It will very much depend on the type of business and is not always necessary.
When would a Jersey employer put an employee on gardening leave?
There are several potential reasons why an employer may choose to put an employee on garden leave.
The employee may wish to end their employment contract. As such the employer will want to keep them away from competitors as long as possible. Placing an employee on garden leave prevents them from sharing important information until it is no longer relevant or of value to competitors.
Garden leave is often used for senior employees who have access to information that could be potentially damaging to the business and its reputation if shared. For example, strategic plans that a competitor could use to gain market share.
Including a garden leave clause as standard in employee contracts may discourage competitors from poaching top talent and put the employer in a stronger position when negotiating with unsatisfied employees.
Keeping the employee out of the picture for some time will allow their successor to establish themselves and build relationships with clients, promoting continuity and customer loyalty.
Garden leave is a useful tool if an employer has reason to believe that a disaffected employee may willfully cause damage to the business while working their notice period.
Do I as a Jersey employer always have the right to place an employee on garden leave?
If the employee’s contract includes express contractual provisions for doing so, for example, a right to exclude the employee from the premises then garden leave is a relatively straightforward process.
If there are no contractual clauses that support the invocation of gardening leave, a court may determine that the employee has a contractual right to continue performing their duties.
It is more likely that the courts will deem that the employee has a right to continue being paid, not to continue working, making garden leave an option for employers even if it is not included in the employee’s contract. However, this is a risky strategy and one that cannot be relied on as the court’s decision is difficult to predict in such cases. In some circumstances, for example, where an employee’s income is dependent on them being able to fulfil certain tasks to earn a commission, a court may look less favourably on an employer preventing the individual from carrying out their duties because this would effectively equate to a salary cut during their notice period. And typically, the longer the notice period, the less likely a court is to enforce garden leave.
Can an employee merely ignore the garden leave?
An employee will be in breach of their employment contract if they fail to work their notice period or serve out the garden leave. The employee will remains bound by the express and implied terms under their contract of employment
If an employee ignores the requirements, for example, by starting working for a new employer before the end of their notice period, the employer can seek damages by claiming breach of contract.