Garden Leave (Freistellung)
Garden leave (Freistellung) is a period during which an employee remains on your payroll but does not come to work, usually during their notice period. You continue paying salary and benefits. It protects you from knowledge transfer to competitors and is common when departing employees hold client relationships or sensitive information. Whether you must offer it depends on your employment contract, company practice, and sometimes the employment level.
Freistellung means you release an employee from their obligation to work while they remain employed and paid. They clock out on day one of garden leave and do not return until their contract ends—typically two weeks to three months later.
It is not termination. The employment relationship continues. You pay their full salary (or agreed percentage if part-time), Pensionskasse contributions, and insurance. They sign no severance agreement unless you also negotiate one separately.
When garden leave comes up
Garden leave is most common when an employee in a client-facing, technical, or leadership role gives notice. You may invoke it to prevent them walking out the door with relationships, source code, or proprietary methods.
It also appears in employment contracts as a standard clause—especially for executives or sales roles. Some cantons and GAV (collective labor agreements) mention it as an option; others leave it to individual negotiation.
- Senior management or roles with direct client access
- Technical staff with access to trade secrets or systems
- Sales roles where the person holds the client list
- When a non-compete clause is in the contract
- If the employment contract explicitly permits it
- During extended notice periods (90+ days)
Your obligations as employer
You must keep paying the employee their full salary and benefits—no reduction unless the contract says otherwise. Pension contributions and employer insurance continue as normal.
Garden leave must be lawful under Swiss contract law (Obligationenrecht, OR). You cannot impose it unilaterally unless the employment contract, a GAV, or clear company practice authorizes it. If the employee refuses and there is no legal basis, they may claim constructive dismissal.
- Pay 100% salary (or Pensum percentage if part-time) during the period
- Continue all employer-paid insurance and Pensionskasse
- Confirm garden leave explicitly in writing before it starts
- Clarify the exact end date and final payout
- Document the reason in your personnel file
- Issue an Arbeitszeugnis on final day as usual
Most common mistake
Announcing garden leave without a written confirmation and treating it as a disciplinary measure. Employees may perceive it as punishment, and without a contract clause or clear precedent, they may challenge it legally.
A lawyer should confirm your specific situation, but the general rule is: garden leave must rest on a contractual foundation or a documented company practice. Do not leave it ambiguous.
- Forgetting to put garden leave in writing before it starts
- Reducing salary or benefits during the period (prohibited)
- Imposing it without a contract clause or GAV basis
- Treating it as unpaid leave or suspension instead of paid leave
- Not setting a clear end date aligned with notice period
- Failing to issue an Arbeitszeugnis or final payslip on time
Frequently asked questions
- Can I force an employee on garden leave?
- Only if your employment contract, a GAV, or established company practice permits it. Unilateral imposition without legal ground may expose you to claims of wrongful dismissal. Consult a lawyer if you have no contract clause.
- Do I still pay benefits and Pensionskasse contributions?
- Yes, without exception. The employee is still employed. You pay salary, insurance, and employer pension contributions as if they were working. Anything less breaches Swiss labor law.
- What if the employee refuses garden leave?
- If there is no contractual or GAV basis, they may refuse and demand to work out their notice period normally. If they refuse and you lack legal ground, you risk a wrongful dismissal claim. Always have written authorization.
General information for Swiss employers, not legal advice. Have a lawyer confirm anything with legal consequences.