Garden Leave, the Quiet Offboarding Strategy That's Making a Comeback
Mizuho, HDFC and Capco reflect a broader shift as Indian employers rethink how executives transition out
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Indian employers across banking and tech are increasingly turning to gardening leave to manage talent transitions while safeguarding sensitive information.
The practice requires departing executives to stay on payroll while being barred from stepping into new roles, typically for one to three months, helping firms control client relationships and confidential know‑how.
In a high-profile recent example, Mizuho Bank has reportedly hired Devendra Sharma from Mashreqbank PSC as co‑head of corporate banking in India.
Sharma will take up his role in Mumbai once he completes his gardening leave in Dubai, Bloomberg reported on Wednesday, 6 August.
At Mashreqbank, he led India corporate banking for eight years and has nearly two decades of experience at ICICI Bank, HSBC and National Australia Bank.
Another case unfolded at HDFC Bank when its Chief Human Resource Officer, Vinay Razdan, resigned effective 18 June.
His resignation letter, filed 2 June, stated he would serve a notice period of three months and proceed on gardening leave unless directed otherwise, a period during which he remains on HDFC’s payroll and off the office floor.
Gardening leave isn’t limited to executives.
In 2023 Wipro’s subsidiary, Capco India, placed several employees on garden leave for two to three months amid project slowdowns tied to reduced work from client HSBC.
Affected staff remained employed and paid but did not report for work during that interval.
The trend has gathered pace over recent years. Companies in banking, financial services and insurance were early adopters, but now tech, consulting, consumer goods and biotech firms also include garden leave clauses in senior contracts.
Employers view the delay as a tool to deter rivals from hiring top talent immediately and to protect trade secrets.
Indian courts permit garden leave only when it is crafted as an interim employment arrangement, not as a post‑employment restriction.
Legal precedent such as the Bombay High Court’s 2007 Kuoni Travel decision underscores that such clauses are enforceable only while the contract remains valid, with compensation paid, and limited in duration.
Among employers, the payoff is clear. A well‑drafted gardening leave clause offers time to manage client handovers, reduce poaching risk and ensure former executives don’t immediately share strategic knowledge with competitors.
For employees, it provides financial continuity and time to plan next steps—even as they are technically sidelined.
