The Relationship between Restraints of Trade and Garden Leave

Yeukai Mupangavanhu

Abstract


The purpose of the article is to examine the relationship between a so-called "garden leave" clause and a post-termination restraint of trade clause in employment contracts, in view of the decision in Vodacom (Pty) Ltd v Motsa 2016 3 SA 116 (LC). The Labour Court grappled with the question of whether the enforcement of the garden leave provision impacts on the enforcement of a post-termination restraint of trade clause. Enforcement of both these types of clauses may be problematic. It can result in unfairness if an employee ends up being commercially inactive for a long period. The author argues that garden leave has a direct effect on the enforcement of a post-termination restraint of trade clause. Accordingly, a restraint of trade will be enforced only if the employer's proprietary interest requires additional protection beyond what is achieved under the garden leave clause.


Keywords


employment contract, restraint of trade, garden leave, proprietary interest and reasonableness.

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References


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DOI: http://dx.doi.org/10.17159/1727-3781/2017/v20i0a1278

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