Employment Law Series: 05 Should I Stay or Should I Go? Garden Leave and Its Application in Turkish Law

 

 

Introduction

Garden Leave originated in the British civil service. Under this emerging practice, employees could request special leave and continue to receive a salary. It is not necessary to have committed a violation in order to take garden leave, and in this respect, it differs from "suspension". Usually, an employee can be directed to take garden leave during their notice period. As an important feature of an employment contract, garden leave helps in substantial issues such as preventing the departure of customers and the strengthening of their business relations with a departing employee and ensuring that pertinent information remains confidential.

Definition

Garden leave refers to the period when employees spend their notice period away from the workplace, although the employment relationship continues, and they continue to receive their salaries.

While on garden leave, fulfilling duties, going to the workplace, communicating with customers, and otherwise being involved in a business’s operations is not required or might even be prohibited.[1] Still, as an obligation, if necessary, an employee must be contactable throughout the entire term and available to be at the workplace as needed.

The Purpose of Putting an Employee on Garden Leave

One of the main purposes of garden leave is to keep employees away from the workplace to prevent them from gaining up-to-date or sensitive information that could be used in their future employment. Similarly, the practice may be used in order to keep an employee away from a workplace to prevent them from sharing information with their colleagues. By doing so, an employee cannot disseminate sensitive, up-to-date, and significant information about their former place of employment should they join a competitor. For instance, by joining a competitor, an employee may reveal secrets and confidential information, such as client lists and business strategies. This can lead to the competitor gaining an unfair competitive advantage.

Most importantly, garden leave is indispensable for employers when it comes to valuable customers who are transferable. Garden leave gives an employer the time to prevent these valuable customers from following an employee on garden leave to their new employer. Thus, employers can better retain their customers and protect their business interests.

Another important aspect of garden leave is encountered in B2C models. In some cases, preventing an employee from interacting directly with customers and customer portfolios can be in the best interests of the employer and the workplace in most layoffs.

Finally, garden leave can be used to prevent an employee from being present during an internal investigation. The purpose of this is to protect the integrity of an internal investigation. For instance, an employee who is being investigated for fraud may not be welcome in the workplace, as they may destroy evidence; or the arrival of a supervisor who practices mobbing may disrupt order within the company. On the other hand, there may be no need to apply garden leave, for example in the case of rightful termination. Because during garden leave an employer continues to pay an employee’s salary, it may be preferable to pay the notice indemnity and dismiss an employee from the workplace.

Possible rights and restrictions for an Employee [2]

In an employment relationship there is an employment contract between the employer and the employee. By virtue of this contract, which originates from private law, the parties can add provisions by mutual agreement of will. These contract negotiations will determine whether an employee is subject to garden leave and the rules, limitations, and duration of its application. For example, the terms of garden leave may prevent an employee from accessing certain information, communicating with customers and employees, and sharing media. The purpose of these terms is clear; to avoid allowing a departing employee to attract customers or damage the company name. In addition to these limitations, bonuses, salary and approving the use of vacation leave may also be decided by the parties.

Imposing Garden Leave if It Is Not Written into an Employment Contract

It is a breach of contract for an employer to impose garden leave on an employee if it is not in the clauses of their employment contract. Therefore, an employee in this situation can immediately consider themselves to have been dismissed.

In addition, an employer does not have the right to isolate an employee unless it is regulated in the garden leave provisions of their employment contract. An employer's failure to keep an employee in the market as much as possible and working may lead to an employee's resignation claiming unjust termination. It is critical not to break a contract in this way, especially if the period granted for garden leave is extensive.

As a consequence of a breach of contract by an employer, any post-termination restrictions and confidentiality protections specified in an employment contract lose their assurance. Moreover, the employer will be vulnerable to legal action from the employee.

How Long Can Garden Leave Be? [3]

Garden leave clauses in an employment contract can only be enforced when an employer needs to protect their own interests and those of the workplace. Usually, the duration of garden leave is as long as the notice period. This period should usually be no more than six months. However, in the case of senior employees and company executives, it has been known for notice periods to be up to 12 months.

Garden Leave in Turkish Law[4]

The concept of garden leave is not regulated in the Turkish Labor Law and other labor law legislation. Suspension by granting garden leave will mean creating a brand-new labor law practice. Although Turkish law does not definitively regulate the concept of garden leave, it does not explicitly restrict its use if both parties agree on it.

Creating a brand-new labor law practice can inevitably have consequences. According to the Turkish Labor Law's protection of the employee, the application of garden leave against an employee’s will (consent) can be described as unfair treatment and as a violation of rights. Besides, since it has no legal basis in Turkish law, it is expressible that an employee's constitutional freedom to work is violated by the practice.  In addition, in the absence of their written consent, an employee will be able to benefit from the provisions of fundamental changes in working conditions.

Alternatively, an employer may put an employee on paid leave. Unlike garden leave, an employee's consent is necessary here. The parties can also sign a non-compete agreement instead of garden leave preventing an employee from leaking updated information to a competitor. Prohibition of competition provisions is explained between articles 444 and 447 of the Turkish Code of Obligations. The said provisions aim to prevent employees from providing services to competitors for a fee.

Restrictive Covenants and Garden Leave [5]

Employers can sometimes add restrictive clauses to a contract instead of or in conjunction with garden leave. With restrictive covenants, establishing or joining a competing business, attracting clients, customers, and suppliers, and recruiting staff are blocked for a period.

The advantages of the restrictive clauses are as a protection for an employer's job security. In addition, restrictive clauses are more beneficial in terms of cost since there is no period when an employee is not working but is still drawing a salary. It is, however, necessary to apply restrictive covenants with care, ensuring there are no more restrictions than is necessary. An extensive, long-term and categorical constraint would be unenforceable.

Conclusion

Garden leave means that an employee is suspended from the workplace for legitimate reasons for a certain time. Although an employer must pay a salary to the absent employee, the advantages mostly outweigh any drawbacks. Garden leave is especially useful for removing employees under suspicion of white-collar crime from the workplace. It may also be desirable in preventing former employees from leaking up-to-date information to competitors. In private law contracts, the parties can arrange a contract as they wish. A garden leave arrangement must be included in an employment contract, or else, an employer who attempts to put an employee on garden leave may be seen as breaching the contract. Although this term has not yet taken hold in Turkey, it can be decided verbally as there is no regulation to the contrary. On the other hand, a written agreement is important in terms of ease of proof. It should be noted that there are similar alternative applications such as paid leave in Turkish Law. Consequently, garden leave is considered an essential issue in the field of labor law, as it has benefits for both the employee and the employer.

With thanks to Öykü Emecan for her assistance on this article.