Gardening leave can be utilised in any situation when an employee's employment agreement is being terminated, and they are obligated to serve their notice period.
What Is Gardening Leave?
You don’t need to be a green thumb to know that gardening is important and necessary. It’s grown out of the necessity for the growth of plants and flowers. Gardening leave or paid time off is a benefit that can be used by people who take care of plants and flowers in their gardens or on someone else’s property.
When an employee resigns from their job, they have to serve a notice period before getting formally relieved of their duties. In exceptional cases, the employer might also put the employee on gardening leave, which means that they’ll still get paid for the notice period, but will be asked not to attend the office during that time.
Suppose you have served your company for 15 years and want to take VRS (Voluntary Retirement Scheme) at age 60. You can draw gratuity based on these 15 years of service. However, suppose you are on gardening leave; your gratuity will also include these days.
Process of Gratuity When the Employee Is on Gardening Leave
The individual will be contract terms maintained as an employee by the employer during gardening leave and will be kept away from the company. It implies that the employee would not be needed to finish work, participate in meetings, or interact with co-workers or clients. Even so, as long as the contract of employment exists during any time frame of gardening leave and until it expires, the employer must proceed to:
- Pay the departing employee their regular salary and
- provide them with the same contract terms and benefits.
Employers use garden leave to protect the interests of their profits when an employee leaves, typically in the case of senior executives or company directors who have larger access to sensitive or privileged data and a large pool of clients. Gardening leave is also commonly used by any employee who provides access to the worksite or interacts with co-workers and clients, increasing the danger of knowledge poaching or misapplication.
When an Employee Is on Gardening Leave,
- the company will send a letter informing them of their rights and responsibilities to the employee’s home address
- This letter will also include a form they can fill out to claim any gratuity owed
- The company will then review their application and decide how much their gratuity is owed
- If the company decides they do not owe any duty, they will be sent another letter informing them that they are no longer qualified for further payment of dues owed to them by the employer.
In most cases, when an employee goes on gardening leave, they are still entitled to their notice period and any other contractual entitlements (such as sick pay). If you do choose to pay out the remaining notice period during this period (which is entirely up to your discretion), then this will be included in their gratuity calculation.
However, if an employee resigns with immediate effect due to a dispute with you over something
for example, if they feel like you or another staff member has unfairly treated them, their entitlement to notice would not be included in the gratuity calculation.
In the Case of Gratuity, the Employer Is Responsible for Making the Entire Payment.
- The employer has to maintain documents like PF deduction and retirement date
- They need to maintain certain documents like PF deduction and retirement date
- You can claim your gratuity only if the employer has maintained certain documents if you are an employee.
For this, they must maintain certain documents like PF deduction and retirement date. The employer will have to maintain these documents for five years from the date of retirement or completion of service, whichever is later. They cannot pay gratuity accordingly if they fail to maintain these records.
Generally, companies do not consider the notice period while calculating gratuity.
The notice period is not considered a service period for calculating gratuity. So if a person is on gardening leave for two months and then resigns from the company, he will get his salary for those two months as per his last salary structure, and that amount will be used to calculate his annual or monthly average.
- The employee will be entitled to get his/her salary for the notice period and other benefits
- The employee will be entitled to get his/her salary for the notice period and other benefits. The employee can also get paid for the notice period and can get paid for the notice period along with other benefits
- If an employee is on gardening leave, they are still eligible to receive a gratuity.
However, the Method of Calculation Differs Slightly
The following steps outline the process:
- Determine the sum of time that has passed since the closing date (in this case, two weeks)
- Multiply this figure by 30 days and add it to the actual figure
- Divide this amount by twelve months, giving you your monthly salary for one year.
Recent Information
You probably had heard about a recent case of an employee on gardening leave for about six months before he/she was informed that her services were no longer required. He then filed a petition in court and won the case by getting his full gratuity amount. The court ruled that the notice period is not included while calculating gratuity, so the employer should pay the employee all his/her salary and other benefits like medical insurance and provident fund during this period.
Conclusion
In a nutshell, the time of gardening leave will be counted as part of your service. This is normal because most companies deduct the gratuity from their salary at the end of a notice period (in your last month). If you are on gardening leave, you don’t need to take special steps to calculate gratuity, and it will be decided automatically depending on your service record.
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