Garden leave is an employment practice in which a resigning or dismissed employee is required to serve out their contractual notice period away from the workplace. The employee remains employed, continues to receive their full salary and benefits, and is bound by all duties of confidentiality and good faith, but is not required -- and usually not permitted -- to attend the office, contact clients, or access company systems. The term originates from the idea that the employee has time to tend to their garden rather than come to work.
From the employer's perspective, garden leave serves several protective functions: it prevents the departing employee from soliciting clients or colleagues, allows a handover period during which access to sensitive information can be managed, and maintains the employment relationship long enough to trigger post-employment restrictions. Courts in the UK and many common-law jurisdictions have held garden leave clauses to be a legitimate and enforceable alternative to post-termination non-compete covenants.
In the Netherlands, a comparable practice exists where employers can release an employee from their work duties during the opzegtermijn (notice period) through a vrijstelling van werk. The employee remains employed and on payroll for the duration of the notice period. Employers should be aware that in the Netherlands, accrued holiday days continue to accumulate during a vrijstelling van werk period, which may affect the financial calculation of the departure settlement.