WARN Act and Garden Leave — Are You Paid to Stay Home During the Notice Period?

When an employer issues a WARN Act notice, many employees assume they will continue working until the notice's effective date. However, some employers choose a different approach: garden leave. Garden leave is not a specific term under the WARN Act, but rather an arrangement an employer may use during the notice period. It can confuse workers because it appears similar to a layoff or suspension, but it is actually still employment.

Garden leave means the employee remains employed and paid during the notice period, but is not required or permitted to work. The employer still pays the employee their regular salary, and the employee keeps their job and benefits, such as health insurance. The employee is typically still covered by employer insurance until the employment ends, and they usually keep accruing benefits.

The effective date, when the employment loss is scheduled to take effect, is what matters, not the last day in the office. Garden leave does not shorten the 60-day notice period required by the WARN Act. The employer must still provide proper notice, regardless of whether the employee is working during that time. Garden leave is not paid time off to do as the employee wishes.

The employer may restrict the employee's activities, such as starting a new job or accessing company systems. The exact restrictions depend on the contract or company policy, not just the WARN Act. The 60-day notice rule still applies. If the employee is on garden leave for the entire notice period, the employer is still giving notice.

The effective date is what counts, not the last day in the office. A short notice period can lead to a WARN violation if the pay stops before the effective date. Garden leave does not cancel the notice or move the effective date earlier. Employees on garden leave are still considered employed until the effective date. They usually keep their employer-provided health insurance and other benefits.

Employees are not eligible for layoff benefits during garden leave, as they have not yet been terminated. Garden leave is distinct from termination, severance pay, paid time off, or suspension. The article advises employees to confirm their contract restrictions, such as the ability to interview or accept other work, non-compete obligations, and health coverage termination.

They should also seek written confirmation of their employment details, such as title, dates, and effective date, before losing access to company systems.