Garden Leave and TUPE

Shiva Shadi, Partner and Head of Employment at Davis Blank Furniss

A clever idea by a senior executive backfired in the case of ICAP Management Services Limited –v- Bury. Mr Bury had given notice to terminate his contract in order to join a competitor.  His employers placed him on garden leave.  Whilst on garden leave, his employers were subject to a share sale acquisition.  Mr Bury informed his employers that he considered that there was a TUPE transfer and stated that he objected to the transfer under the TUPE Regulations.  By objecting, this meant that his employment would be terminated at the point of transfer, releasing him to take up new employment earlier than he would have otherwise been able to do so with his new employer and in competition. His employers sought to enforce the garden leave and succeeded.  It was held that TUPE required a change of employer and as the share sale did not result in a change, there had been no TUPE transfer, to which he would have been able to object to.

His employers were therefore able to enforce the garden leave.

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