Labor & Employment Law

Garden Leave employment contracts

There is a great Feb. 5, 2009 New York Law Journal Employment story by Jeff Klein and Nick Pappas about so called "garden leave" employment contracts. (Registration required). What is garden leave? The article describes these clauses as follows:

For many years, employers in the United Kingdom have included in their employment agreements so-called "garden leave" clauses. Under a garden leave clause, the employee promises to give a certain amount of notice to the employer in advance of the employee's resignation from employment. In exchange, the employer does not require the employee to work during the period of the garden leave. The term garden leave is based on the quaint idea that the employer pays the employee to stay at home and tend to his or her "garden."

U.S. employers increasingly are including garden leave provisions in their employment agreements. One reason for this is that garden leave clauses have some of the same benefits as non-competition agreements, but perhaps without some of the challenges employers often face in enforcing non-competition agreements. Employers also may realize certain advantages in employee relations as employees may perceive the "optics" of garden leave more favorably than the way in which they perceive the restrictions of non-compete agreements.

Just as with a non-compete agreement, if the employee fails to abide by the garden leave clause, the employer may apply to the appropriate court for an injunction that would enforce the provision. Thus, ideally, the garden leave provision protects the employer against both competition from the employee and/or misappropriation of confidential business information.
Though this is an interesting issue, I have no doubt that such clauses are unenforceable in New York.

In Matter of Vinluan v. Doyle, ___A.D.3d___, 2009 WL 93065 (2d. Dep't. Jan. 13, 2009), the court held that nurses had the right to quit en mass without notice by virtue of the 13th Amendment.

Readers of this blog will note that I just wrote a law review article about that case.

That article and my blog posting about Vinluan are available at:
http://lawprofessors.typepad.com/adjunctprofs/2009/01/publication-of.html

Mitchell H. Rubinstein

Full post as published by New York Public Personnel Law on February 09, 2009 (boomark / email).