Can I work for someone else during my garden leave?

Garden leave is one method employers can use to protect their business interests when an employee leaves their employment. When an employee is placed on garden leave they may be restricted from attending work, contacting customers and performing their normal duties. When  employees leave their current employment for new opportunities, some may be placed on garden leave during their notice period. They may wonder whether they really have to wait it out, or whether they can begin working for a new employer right away.

Do I have an implied right to work?

In some circumstances, an employee may have an implied right to work. Courts have found that employees have an implied right to work in some cases where performing work is necessary to keep up to date with the market, maintain skills, and avoid atrophy. An implied right to work is more likely to arise with senior employees who possess specialised skills. It may also arise where an employee’s remuneration is heavily dependant on them being able to work, such as sales representatives whose pay is mostly commission-based.

Where there is an implied right to work, an employer will be committing a repudiatory breach of contract if they place their employee on garden leave without an express clause allowing them to do so. The employee will then be able to bring the employment contract to an end and work for a new employer.

An employer can avoid this scenario by ensuring their employee’s contract contains an express term allowing them to place the employee on garden leave, as an express term will override the employee’s implied right to work.

What happens during garden leave?

If your employer places you on garden leave, the rest of the employment contract continues as normal. Your employer must continue to pay your salary in the usual way and allow you to take annual leave. You should also continue to receive your contractual benefits such as health insurance or a company car. During garden leave your employer may require you to perform alternative duties or work from home, and you may be required to return any company property in your possession which was provided for work purposes, such as a company mobile or laptop.

During garden leave you also remain bound by your contractual terms, which in many cases will include an express term that you not work for another business while employed by your employer. Even where no express term is present, you will continue to owe a duty of loyalty to your employer and a duty not to disclose confidential information to a third party. You will likely need to be available to perform work if requested, unless you take annual leave.

Your employer may not be able to exclude you from work for the whole of your notice period unless they can show that this is necessary to protect a legitimate business interest. Legitimate business interests that have been recognised by the courts include protecting:

• Trade secrets;
• Confidential information;
• Clients’ goodwill; and
• Stability of the workforce.

What are the potential consequences of working for someone else while on garden leave?

If you do find employment elsewhere and go to work for another business while on garden leave, this will be a breach of contract and your employer may be able to obtain a remedy against you. A court may grant your employer an injunction to stop you from working for a competitor. In deciding the length of the injunction, the court will consider what is necessary to protect the legitimate interests of your employer. Alternatively, the court may award damages to your old employer if damages would adequately compensate the employer for your breach of contract.

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.  All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.