Your account manager resigns to join another business. You want a reliable handover but are concerned about continued access to customer information. Garden leave may form part of the answer, yet an instruction to stay at home leaves important questions unresolved. Who handles outstanding orders? Does the company car stay available? When does employment end? This guide uses that illustrative SME scenario to explain the decisions employers should make before the arrangement begins.
Be clear about what garden leave means
Acas describes garden leave as an arrangement in which an employee does not work for part or all of their notice period but remains employed. They receive their usual pay and contractual work benefits. GOV.UK also describes arrangements involving staying away from the workplace or working at another location during notice.
Payment in lieu of notice, often called PILON, has a different effect: employment ends immediately and notice is paid instead. Acas says the contract may authorise it; otherwise agreement is needed. Do not use the two labels interchangeably in the leaving letter or payroll instructions.
Our practical recommendation is to show three dates separately: the last day doing normal duties, the start of garden leave and the date employment ends. For the account manager, a short working handover followed by garden leave can be recorded as one clear timeline. The departure announcement should use the same dates.
Check the contract before issuing the instruction
Acas's settlement-template guidance says whether garden leave can be required depends on the employment contract; if it is not provided for, the employee needs to agree. Read the actual clause and the surrounding terms rather than assuming every notice clause includes the same power.
Check the permitted duration, duties, availability, place of work and any relevant provisions about customer contact or other employment. Acas recommends legal advice where a significant period of garden leave is proposed. Obtain advice as well where the clause is disputed, the role raises unusual issues or you intend to rely on restrictions against a competitor.
Write down the business reason and why the proposed arrangement fits it. In our example, protecting current customer information and transferring account ownership are concrete concerns. A general wish to keep someone away after an awkward resignation needs closer examination. Keep the decision separate from any allegation of misconduct or formal investigation.
Acas: agreeing garden leave and checking contractual authority ↗
Give payroll a complete pay-and-benefits instruction
GOV.UK confirms that garden leave carries the same pay and contractual benefits. List the items that need to continue and ask payroll or the benefits provider to confirm the arrangements. Do not stop an employee's benefits merely because their building pass is disabled.
Check salary, allowances, pension arrangements, insurance, company-car terms and any contractual benefits individually. GOV.UK says entitlement to bonuses and commission during notice depends on the contract. Review the scheme wording and any transactions already earned; do not assume that every variable payment stops when normal duties stop.
HMRC distinguishes garden-leave earnings from a payment that ends the contract immediately. Its National Insurance guidance says even a lump-sum payment of earnings for a continuing notice period can remain garden-leave earnings and attract Class 1 contributions normally. The timing or size of the payment alone does not determine the employment arrangement.
GOV.UK: garden leave pay and benefits ↗ · GOV.UK: notice-period bonuses and commission ↗ · HMRC: garden-leave earnings and National Insurance ↗
Plan the handover and access changes together
Our suggested handover record has four fields: current issue, next action, deadline and new owner. The account manager might identify a disputed invoice, a promised delivery date and a customer awaiting renewal terms. A folder of messages without named responsibility is unlikely to provide continuity.
Agree what work must be completed before access changes, what information the employee may retain for agreed duties and how later questions will be handled. Coordinate HR, the line manager and IT so access is restricted at the intended point while necessary records are preserved. Remove access to confidential systems according to the plan, rather than deleting material the business still needs.
Record arrangements for keys, passes, devices and documents. Separate equipment needed for work from items that are also contractual benefits, such as a car available for private use. Check the terms before requiring their return. Tell customers and colleagues who now owns the account, using a neutral message that does not imply wrongdoing.
Make the leaving arrangements clear before access changes.
HR + SAFETY can help review notice arrangements, handover responsibilities and the instructions managers give to payroll and IT.
Discuss your garden-leave arrangementsSet a realistic contact and availability plan
Our practical recommendation is one named manager, one agreed contact route and clear expectations about any permitted handover work. Explain how requests will arrive, when a response is expected and who can authorise a change. Match these arrangements to the contract and any agreement with the employee.
Explain applicable confidentiality, customer-contact and other-employment obligations accurately. Do not turn a standard leaving letter into a new collection of restrictions the employee has never agreed to. If a proposed new job or competitor issue creates uncertainty, obtain advice on the actual terms and facts before making threats or withholding money.
Keep a route open for questions about pay, benefits, holiday and wellbeing. The employee remains part of the employment relationship until it ends. If sickness or statutory leave arises during notice, ask payroll and HR to check the applicable rules: Acas explains that notice-pay calculations can vary with the circumstances and contractual notice period.
Record holiday separately from garden leave
Do not automatically mark every garden-leave day as annual leave. Acas says holiday may be taken during notice subject to the relevant request and approval arrangements, and the employer may ask a worker to take holiday before leaving. Apply the relevant notice requirements, contract and policy, and confirm the actual holiday dates.
Calculate entitlement to the employment end date, taking account of the applicable accrual rules, holiday already taken and any valid carry-over. GOV.UK says untaken statutory leave must be paid when employment ends; additional contractual leave can have separate agreed arrangements. Any recovery for excess holiday taken needs prior written agreement.
Give payroll the final date, recorded holiday dates, remaining entitlement and other outstanding items together. A clear reconciliation helps prevent an employee being treated as both on annual leave and available for routine work on the same days.
Acas: taking holiday during notice ↗ · GOV.UK: holiday and final pay when leaving ↗
The garden-leave confirmation checklist
Official UK primary sources checked on 13 November 2026. Employment-law discussion concerns Great Britain; Northern Ireland has a separate framework. The account-manager scenario and practical handover recommendations are original illustrations, not prescribed legal forms.
- Confirm the contractual authority or agreed arrangement.
- State the last normal working day, garden-leave start and employment end date.
- List continuing pay, benefits and the treatment of variable pay.
- Assign handover actions and customer ownership.
- Coordinate system access, records and property arrangements.
- Set the contact route and explain existing obligations accurately.
- Record holiday dates and reconcile the final entitlement.
- Review any proposed change before altering the agreed leaving date.
Garden leave works best when the dates, continuing employment terms and handover arrangements are explicit. Check the authority, keep payroll aligned and record the point at which employment actually ends.
This guide provides general information for UK employers. It is not legal advice and should not replace advice based on the facts of a specific matter.