Garden leave explainer

Garden leave versus notice pay in lieu

Garden leave

You remain an employee for the whole notice period, keep drawing salary and benefits, but do not perform your role or attend office. Your restrictive covenants, including confidentiality and often non-compete terms tied to employment, generally stay active because employment has not ended.

Notice pay in lieu of service

Your employment ends immediately, and you are paid a lump sum instead of working through the notice. Once employment ends, obligations that were tied to being an employee typically lapse, though standalone confidentiality and IP clauses usually survive on their own terms.

Why the distinction matters for your next job

On garden leave you are still technically employed, so most contracts expect you not to start another job, even remotely, until it ends. Once notice pay in lieu has been given and employment has ended, you are generally free to join immediately, subject to any separate non-compete you signed.

What you can typically do on garden leave

Take time off and travel

You are not required to be reachable in the way you would be while actively working, though your contract may still ask you to remain contactable for handover questions.

Interview and negotiate a new offer

This is standard and generally not restricted, as long as you are not actively working for a competitor before your employment with the current employer has actually ended.

Continue receiving salary, benefits and any vesting that runs on a time basis

Because you remain employed, contractual benefits tied to employment status usually continue unless your specific agreement says otherwise.

What you typically cannot do on garden leave

Start work, paid or unpaid, for another employer

You are still under this employer’s contract, so beginning another job before it ends is usually a breach, even if the new employer is willing.

Contact clients, vendors or colleagues about the new role

Most garden leave clauses double as a soft non-solicit period, restricting outreach that could be read as poaching relationships built in your current role.

Access sensitive systems or continue decision-making authority

Employers commonly revoke system access and remove you from active projects at the start of garden leave, precisely to prevent this while keeping the employment technically intact.

How this is worked out

Questions people ask

Am I still paid during garden leave?

Yes. Garden leave keeps your employment and pay active; that is what distinguishes it from a termination with notice pay in lieu, where employment ends immediately and you receive a lump sum instead.

Can I join a new employer while on garden leave?

Generally no, because you remain employed by your current employer for the duration. Starting work elsewhere before your garden leave ends is usually treated as a breach of your existing contract, not as a right you carry through notice.

Is garden leave common at every level in India?

No. It is most common for senior, client-facing or regulated roles, particularly in financial services and consulting, where an employer wants someone out of active decisions immediately. Most standard notice periods in India are simply worked notice or notice pay, not garden leave.

What happens if my employer wants me on garden leave but my contract does not mention it?

They generally cannot impose it unilaterally without contractual basis, though many will negotiate a version of it informally by mutual agreement, sometimes alongside an early relieving date. Get any such arrangement in writing.