Garden Leave

Employment Law – Garden Leave – Contractual Terms – Interim Injunction

The case of SG & R Valuation Service Co v Boudrais and Others [2008] involved a determination as to whether two employees could be excluded from work, even when there was no contractual provision in their employment contracts relating to garden leave. The two employees in question were employed by SG & R Valuation Services.

They resigned by giving their notices, however, the employer subsequently became concerned about their activities in the workplace. The employer elected to ask them to remain at home. The employer sent them letters to this effect and stated that they were suspended. The employees submitted that the employer was breaching the terms of their employment contracts by preventing them from working due to the fact that their contracts did not contain garden leave clauses.

However, the employer produced evidence that:

§   The employees had been planning to join one of the employer’s competitors;

§   The employees had removed confidential information from the employer’s workplace; and

§   The employees had attempted to convince other employees to join them.

The employer duly applied for an interim injunction. Subsequent to the application, the employees decided to return the confidential information. Furthermore, they both gave undertakings that they would not attempt to solicit fellow employees until their notice periods expired.

The court held that the employer had the right to put them on garden leave, despite no such clauses existing in their contracts. The court came to the decision that an employee's ‘right to work’ is founded on the basis that the employee is ready and willing to work and happy to adhere to the terms and conditions of the employee’s employment contract.

The court held that in this case, the employees had breached their contracts and had destroyed the mutual trust and confidence between the employees and the employer. Accordingly, the court granted the injunction.

Note:  This case is interesting due to the fact that it demonstrates that even when there is no garden leave clause in an employment contract, the ‘right to work’ is affected where the employee's behaviour is evidence that the employee is ready and willing to work or to adhere to the terms of the employee’s contract.

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© RT COOPERS, 2008. This Briefing Note does not provide a comprehensive or complete statement of the law relating to the issues discussed nor does it constitute legal advice. It is intended only to highlight general issues. Specialist legal advice should always be sought in relation to particular circumstances.