Garden leave: 12-month restriction upheld by High Court

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By Katy Meves

The High Court has granted an injunction to keep an employee on garden leave for the whole of his 12-month notice period. The recent decision in JM Finn & Co Ltd v Holliday demonstrates that garden leave clauses can be a very helpful tool for an employer dealing with an employee who wants to join a competitor.

Garden leave clauses are commonly found in employment contracts, particularly those of senior employees, and expressly allow an employer not to provide the employee with any work and to require them to stay away from business premises and customers during any notice period. This should be coupled with an exclusive service clause that prevents an individual from working for anyone else during his or her employment with the employer.

Without such an express power to isolate an employee in this way, an employer’s action in not providing him or her with work may be regarded as a breach of contract entitling the employee to resign and claim constructive dismissal…

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