Garden Leave Clause Explained: What It Means for Your Notice Period
This page is general information, not legal advice.
A garden leave clause lets your employer tell you to stay away from work during your notice period while you're still employed. You're usually still paid, but you can't start a new job, contact clients or colleagues, or take on other work without permission. Employers use these clauses to keep departing staff away from customers and current information before they join a competitor. A fair version can work like a paid break. A broad one can drag out your exit, stall your career and cut your pay. This page explains how these clauses work, which versions move risk onto you, and wording you can propose. Whether and how garden leave can be used varies a lot by jurisdiction and type of employment, so use this as a starting point.
The example clauses below are illustrative. They are not taken from any real company's contract.
What a garden leave clause is
A garden leave clause usually sits in the notice section of an employment contract or offer letter. During all or part of your notice period, it typically lets the employer tell you not to come to work, take away your duties or give you different ones, and cut your access to systems, clients and colleagues. It can also require you to stay available in case you're needed and bar you from working for anyone else. You're still an employee, so your other duties under the contract, such as confidentiality and loyalty, still apply.
A typical clause might read: "During any period of notice, whether given by Company or Employee, Company may require Employee not to attend work, not to perform any duties, and not to contact any client, supplier or employee of Company. Employee shall remain an employee of Company and shall not take up any other employment during this period."
The main things to check are how long the notice period is, what you're paid during it, and whether it counts toward any restriction that applies after you leave. See non-compete clauses explained.
1. A long notice period with garden leave on top
A typical clause might read: "Employee shall give six (6) months' written notice of resignation. Company may place Employee on garden leave for all or any part of the notice period, at its sole discretion."
Why it works against you
A long notice period may not bother you while you're doing your job. Under garden leave, it turns into months on the sidelines. A new employer may not be willing to wait, and your skills and contacts go stale in the meantime. The notice terms are also often unequal. You may have to give long notice while the company can end things much faster, especially where employment is otherwise at will. See at-will employment clauses explained.
What to ask for instead
Sample wording to propose: "The notice period is the same for both parties. Any period of garden leave will not exceed [X] weeks. At Employee's written request, Company will consider releasing Employee early from the notice period and will not unreasonably refuse."
2. Pay and benefits that shrink during garden leave
A typical clause might read: "During any period of garden leave, Employee shall be entitled to base salary only. Employee shall not be eligible for any bonus, commission or incentive payment."
Why it works against you
If a large part of your pay comes from commission, bonus or equity, "base salary only" can mean a big pay cut just because the company chose to send you home. Some bonus plans also require you to be employed and not under notice on the payout date, so garden leave can cancel a bonus you've already mostly earned. Check how benefits, pension contributions and equity vesting are treated too.
What to ask for instead
Sample wording to propose: "During garden leave, Employee will continue to receive full salary and all contractual benefits. Employee remains eligible for any bonus or commission earned for work performed before garden leave began. Equity awards continue to vest until the end of the notice period."
3. Garden leave stacked on top of a non-compete
A typical clause might read: "For twelve (12) months following the Termination Date, Employee shall not work for or provide services to any competitor of Company."
Why it works against you
Read this next to the garden leave clause. If the non-compete starts only after your notice period ends, your total time out of your field is the garden leave plus the full restriction. That can add up to much longer than either clause looks on its own. Some jurisdictions take garden leave into account when deciding whether a restriction is reasonable, and others don't.
What to ask for instead
Sample wording to propose: "Any period Employee spends on garden leave will be deducted from the duration of any post-employment restriction in this Agreement."
4. Open-ended duties while you're at home
A typical clause might read: "During garden leave, Employee shall remain available at all times to perform any duties Company may assign, shall take any accrued holiday as directed by Company, and shall not engage in any other business or activity."
Why it works against you
"Available at all times" can stop you from travelling, studying or dealing with personal matters. "Any other business or activity" can catch side projects, volunteering or getting your own business ready that has nothing to do with your employer. If the company can make you use your accrued holiday during garden leave, you may lose paid time off you planned to take or be paid out for. And if you break one of these vague rules, it could trigger repayment of a signing bonus or relocation payment. See clawback clauses explained.
What to ask for instead
Sample wording to propose: "Company will give Employee at least [X] business days' notice of any duties during garden leave. Employee may engage in activities that do not compete with Company or use its confidential information. Accrued holiday will be paid out at the end of employment unless Employee chooses to take it."
Also worth a look
Check whether the contract lets the company pay you in lieu of notice instead of using garden leave, and how that payment is worked out. Confidentiality duties continue during garden leave and often for a long time after it (see confidentiality survival clauses explained). If you're negotiating an exit package, garden leave terms are often reopened there, so see severance agreement red flags. If you're still deciding on a new role, see offer letter red flags before you sign.
Scan your own contract free
A few words in the notice section can decide whether garden leave is a paid break or months without work. Upload your employment contract or offer letter (PDF, DOCX, TXT or MD), or take a photo of it, to the ScanMyTerms employment contract review. In about a minute it lists the clauses that work against you, with a risk level, the exact wording, why it hurts and how to change it. The free preview needs no sign-up and shows the risk count and the first two findings. The full report costs $5. ScanMyTerms doesn't use your documents to train AI models, and reports are deleted after 7 days.
This page is general information, not legal advice. Notice and garden leave rules vary by jurisdiction, so for decisions about a specific contract, talk to a qualified employment lawyer where you live.
Sources
- All clause examples on this page are illustrative and written for this guide. They are not quoted from any real company's contract.
Check your garden leave clause with a free preview, no sign-up needed →