An irrevocable garden leave is a unilateral statement by the employer that releases the employee from the duty to work while continuing to pay salary, but it does not automatically end when the employee files a protection‑against‑dismissal claim. A recent ruling by the Lower Saxony State Labour Court (LAG Niedersachsen) shows that the binding effect of such a leave is limited to the original notice period, even though the employee challenges the dismissal in court. Many employees hope to keep working until the proceedings conclude, but this hope often falls short. What does this ruling mean for you concretely? What rights do you have during the leave, and how can you strengthen your position for a severance payment? This article explains the background and gives you clear recommendations.
Irrevocable Garden Leave: A Powerful Tool for Employers
The irrevocable garden leave is a unilateral statement by the employer that frees the employee from the obligation to work – without the employee being able to influence it. Unlike the revocable variant, which the employer can withdraw at any time, such a leave is final: the employee does not have to report for work but continues to receive salary until the end of the notice period. This situation is common in practice, especially when the employer fears that the employee might disrupt business operations or disclose confidential information to competitors during the notice period.
It is important to understand that the leave is not a dismissal. It does not terminate the employment relationship but merely suspends the duty to work. The employment contract remains in force – with all rights and obligations that are not expressly suspended. This includes, in particular, the employer’s duty to pay wages, which continues during the leave. A ruling of the Lower Saxony State Labour Court (16.03.2026, Az. 4 SLa 854/25) confirms that such a leave does not become ineffective merely because you contest the dismissal – its binding effect, however, is tied to the original notice period and does not automatically last until the final resolution of the proceedings.
The Protection‑Against‑Dismissal Claim as a Central Element of Your Defence
The irrevocable garden leave does not relieve you of the obligation to observe the three‑week claim period under § 4 of the Protection against Dismissal Act. If you do not file the protection‑against‑dismissal claim within this deadline, the dismissal is effective regardless of whether you are on leave. This deadline is the most important hurdle in any dismissal‑protection procedure. Missing it means losing your job and any chance of a severance payment or reinstatement.
The deadline starts with receipt of the dismissal and ends on the third working day of the following month. Although this sounds simple, it is often tricky in practice: public holidays, weekends and company closures do not extend it. Furthermore, you must file the claim with the competent labour court – that is only the formal step. The real challenge follows: you need to present convincing arguments and evidence. A specialist employment lawyer can help you with that and realistically assess the prospects of your claim.
The irrevocable garden leave does not relieve you of the obligation to observe the three‑week claim period under § 4 KSchG.
What the LAG Niedersachsen Ruling Means for Your Employment Relationship
In the case decided by the LAG Niedersachsen (16.03.2026, Az. 4 SLa 854/25) the employer had placed the employee on an irrevocable leave until the original termination date. Still during the notice period the employer recalled the worker to duty, but the employee stayed away, relying on the irrevocability of the leave. The court held: filing a protection‑against‑dismissal claim does not automatically nullify the leave – it is a separate declaration whose binding effect generally extends beyond the point of judicial clarification.
However, this effect is not unlimited: in the decided case the claim for wages existed only up to the original termination date. For the period thereafter the court denied a claim because, despite the recall and the ongoing employment relationship, the employee did not report for work. For you this means: if you are called back to work – perhaps because the proceedings are delayed or the employer changes its stance – you should comply, otherwise you risk losing your wage entitlement. The leave remains an effective tool for the employer, but its effect does not automatically last until the final resolution of your protection‑against‑dismissal claim.
Your Rights During the Leave: Salary, Holiday and More
Even while on leave you remain entitled to your contractual salary. The employer must pay it until the end of the notice period – and beyond, if the dismissal is found invalid and the employment relationship continues. Make sure that payments arrive on time and in full. If the employer reduces payments, you can enforce this claim in court, for example in a wage claim.
A frequent point of contention is holiday entitlement. During the leave you must offset holiday against your entitlement only if the employer expressly states so. Without such a statement your holiday right remains intact and can be paid out later. You are also entitled to a qualified reference that must be favourable – irrespective of whether you are on leave. Obtain the reference promptly and check it for completeness and accuracy. A lawyer can help with phrasing that matches your career development, as they know the standard formulations.
Your Negotiating Position for a Severance Payment After the LAG Ruling
Such a leave does not mean you have to forgo a severance payment. On the contrary, many employers offer a severance to settle the dismissal‑protection proceeding and obtain legal certainty. The amount is a matter of negotiation – there is no statutory entitlement, except in the rare cases of § 1a KSchG where the employer explicitly links the severance to the dismissal notice. In practice many settlements follow the rule of thumb of 0.5 to 1.0 gross monthly salaries per year of service, but this is only a guideline, not a guarantee.
Your negotiating position depends on several factors: length of service, age, prospects on the job market, and the likelihood of success of your protection‑against‑dismissal claim. The irrevocable garden leave can be a double‑edged sword: on the one hand it shows that the employer no longer wants you in the workplace, which can strengthen your position; on the other hand the employer may argue that, because you have already been released from work, you are effectively out and therefore have less leverage. Let a lawyer advise you on how to use this dynamic to best effect. An experienced counsel can estimate the prospects of your claim and give a realistic framework for the severance negotiation. Moreover, a lawyer can help optimise the tax treatment of the severance, for instance by applying the one‑fifth rule, as explained in our article on the one‑fifth rule for taxing severance payments.
Practical Recommendations: How to React Correctly
For employees affected by such a leave, the following steps are advisable: First, verify that the leave was communicated in writing and unambiguously. If no such statement exists, you may continue to report for work and offer your services. Second, keep records of all relevant documents – the dismissal notice, the leave declaration, pay slips and correspondence with the employer. These files form the basis of your protection‑against‑dismissal claim and any subsequent claims.
Third, clarify whether you are allowed to take on secondary employment during the leave. Many contracts contain clauses that prohibit side activities while the employment relationship exists – also during the leave. Violating such a clause can lead to a warning or even an immediate dismissal. Fourth, consider your social‑security situation: during the leave you remain compulsorily insured, but after the employment relationship ends you may face a waiting period for unemployment benefits if you resign voluntarily or sign a settlement agreement. Seek advice from the Federal Employment Agency or a specialist employment lawyer. Another important point is whether you wish to enter a new employment relationship. The leave offers you the opportunity to apply for other jobs without the pressure of having to accept an offer immediately. Use this time wisely and plan your career transition strategically.
Conclusion: The LAG Ruling as a Wake‑Up Call for Your Rights
The LAG Niedersachsen ruling makes clear: such a leave is an effective tool for the employer, but its binding effect is tied to the original notice period, not automatically extended until the final resolution of your protection‑against‑dismissal claim. As an employee you should not rely on staying on leave for the whole duration of the proceedings – respond to any recall by the employer and at the same time aim for the best possible economic outcome. The leave gives you time and space to secure your rights, negotiate a severance and plan the move to a new job. Obtain professional assistance early – a specialist employment lawyer can realistically assess your chances and initiate the appropriate steps. And if the cost of the proceedings is an obstacle, check whether a litigation funder such as RechtStark can finance your protection‑against‑dismissal claim – so that your rights are not thwarted by lack of funds. Further useful information on protection‑against‑dismissal claims can be found in our article on the deadline for filing a protection‑against‑dismissal claim.
Note: This article is for general information purposes only and does not replace individual legal advice. For a free initial assessment of whether litigation funding may be an option for your case, you can contact RechtStark.