A Court of Appeal ruling made last week means that companies can no longer assume that they can enforce gardening leave if the term is not in their employment contracts.
Steve Tucker, a bookmaker, resigned from William Hill to go to a rival company, but was told he had to stay at home during his six-month notice period.
Tucker's contract had no gardening leave clause. William Hill, represented by Allen & Overy, who instructed Andrew Clarke QC, said that it was not needed, but the judges disagreed.
Macfarlanes partner Tony Thompson advised Tucker, instructing Martin Griffiths as counsel. Fellow partner Andy Millmore stressed: "Most City law firms are already aware of the dangers." He said firms planning to use gardening leave had probably already written it into their contracts. He said that the ruling applied to employees, so it would not affect partners.
Gardening leave clauses in partnership deeds are becoming more common. Last autumn The Lawyer revealed that Clifford Chance had introduced one.