Moonlighting in common parlance means the taking up of an additional job outside of the person’s primary employment. Such additional job could either be full time, part time or freelance. The taking up of the additional job could be with an intention to earn supplemental income or improve upon one’s skill sets.
In recent years, more particularly after the COVID-19 pandemic, moonlighting has become prevalent than before. The work from home or the remote working concept has promoted multitasking and given the employees a better opportunity to attempt to supplement their income apart from their primary employment.
Benefits Of Moonlighting for Employees
Certain benefits/advantages for the employees that assume additional jobs apart from their primary employment may be as under:
- Supplemental income,
- Exposure to distinct roles and responsibilities,
- Opportunity to improve upon one’s skill set.
- Provides a cushion against unexpected layoffs.
Challenges To the Employer Due to Moonlighting
While moonlighting may be beneficial to the employees, however the same may pose certain challenges to the employer as under:
- Impact on productivity of employees due to the employee dedicating time and energy to additional jobs as well.
- Threat to privacy- Employers may also be at a risk of loss of critical data due to the employee taking up a side job with the employer’s competitor.
Is Moonlighting Legal in India
The term ‘moonlighting’ has not been defined under any Act, Rules or Regulations as framed by the Parliament or any state legislature in India.
There is no explicit provision under Indian laws which would prohibit moonlighting or make the same as a punishable offence.
- The only few provisions under Indian law which prohibits double employment can be found in Section 60 of the Factories Act, 1948 and the Shops & Establishments Act. Section 60 of the Factories Act provides that no adult worker would be allowed to work in any factory on any day on which he has already been working in any other factory, save in such circumstances as may be prescribed.
- Another pertinent mention needs to be made of the definition of ‘worker’ under the Factories Act which means to include a person working in any manufacturing process or in cleaning any part of the machinery or premises used for a manufacturing process or in any other kind of work incidental to or connected with manufacturing process.
- Furthermore, the Delhi Shops & Establishments Act 1954, which is applicable to shops, commercial establishments, establishments for public entertainment, etc also puts a restriction on double employment.
However, what can be ascertained from the above is that the bar against double employment is applicable only to persons engaged in manufacturing processes in a factory or workers and do not apply to employees working in a professional, supervisory, or administrative capacity/role.
It is also evident from the above that the above provisions would not cover employees working in the IT industry where the phenomena of moonlighting have gained tremendous traction.
NOTE: On a conspectus of the above, it can be said that there is no legal impediment to moonlighting barring the contractual provisions which may exist between the employer and employee.
Contractual Provisions Between the Employer and Employee
The contract entered between the employer and the employee, called the employment contract, may provide for a prohibition against the employee from undertaking any other employment during the subsistence of the employment. In case such a stipulation is provided for, then the employee may not be legally permissible to moonlight, violation of which may also serve as a ground of termination.
Such employment contracts may also provide for certain relaxations to the effect that as long as the employee is transparent about his side job(s) and such side jobs(s) are not undertaken for any company which is a direct competitor of the employer, the employee may be free to take up such side jobs.
Essentially, the terms of the employment contract must be clear, unambiguous and categoric when it comes to imposing restrictions on the employee to take up any side jobs. Restrictive clauses are not generally considered to be implied in the employment contract and hence it is of utmost importance that restrictive clauses are spelt out in categoric terms.
Essentially, the legality of moonlighting is dependent on the contractual terms between the employer and the employee. In case the employer intends to prohibit the employee from entering any other employment during the subsistence of the contract, then specific stipulation to that effect ought to be provided in the contract.
Further, it should also be ensured that the penalty for breach of such clause is also clearly spelt out. In case the employee intends to accept additional side jobs, then he must ensure that the same does not fall foul of the contract which may have been entered into between him and the principal employer.
What Should an Employer do if an Employee Moonlights in Breach of the Contract
If an employer finds out that the employee has engaged in moonlighting without the consent of the employer or in breach of the employment contract, then the employer may-
- Initiate appropriate disciplinary proceedings against the employee as may be provided for in the contract as well as the policies of the employer.
- Terminate the employee in case the employment contract provides for such a punishment.
- Initiate legal proceedings before a Court of law to claim damages from the employee.
What Should an Employee Do in Case the Employer Does Not Permit Moonlighting
In case the employment contract does not contain any stipulation, which prohibits moonlighting, and the employer prevents such employee from taking on an additional job, the employee-
- Should discuss the issue with the employer and try to reason with the employer that the additional job would not pose a conflict of interest for the employee.
- Further, it is for this reason that it is always considered prudent for the employee to discuss the moonlighting policy at the time of initial joining and ensuring that relevant clauses are in place in the employment contract to protect the employee’s interests.
Decision Of Indian Courts on the Issue of Moonlighting
Since the concept of moonlighting is of recent origins, Courts in India have not had many occasions to decide the legality and validity of moonlighting. However, certain cases have indeed reached the Courts concerning dual employments.
The Punjab & Haryana High Court in the matter of Gulbahar vs Presiding Officer, Industrial Tribunal & Anr refused to interfere with the termination of an employee (a driver) on the ground that the employee was engaged in dual employment as he was working in two institutions at the same time.
Conclusion
Moonlighting is not specifically prohibited under any law in force in India. The restrictions thereof may arise out of the contractual relationship between the employer and the employee. In case, express provisions are made in the employment contract against moonlighting, then the employee would not be permitted to engage in the same. However, if no express provision is made in the contract prohibiting moonlighting, then the employee may be at liberty to take up additional jobs during the subsistence of his primary employment.
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