Category: Strategic Business Alignment

The rise of moonlighting—working a second job alongside a primary role—has become a growing concern for employers across industries. While the practice of taking on extra work outside regular hours isn’t new, its prevalence is increasing as more professionals look for ways to supplement their income, explore new interests, or build side businesses.

Moonlighting involves managing two jobs simultaneously, often without the primary employer’s knowledge, which can create conflicts of interest and affect job performance.

For employers, this trend poses challenges such as decreased productivity, divided focus, and potential ethical issues. As moonlighting becomes more common, organizations must navigate how to address it effectively while considering the reasons employees are seeking additional work.

This article explores the concept of moonlighting, its implications for businesses, and strategies for managing this evolving workplace phenomenon.

What is Moonlighting?

Moonlighting is when someone works a second job in addition to their main job. It usually happens after regular working hours, hence the term “moonlighting,” like working under the moon.

For example, imagine you have a full-time office job during the day, but in the evenings, you drive for a ride-sharing service or maybe do some freelance writing. That extra work you’re doing on the side is considered moonlighting.

However, it’s important to be mindful of company policies because some employers have rules about moonlighting, especially if there’s a risk of conflict of interest or if the extra work affects your performance at your main job.

Based on a survey by Kotak Institutional Equities, 65% of employees are into moonlighting or looking for part-time job options while having a full-time job. Experts often believe that moonlighting should be accepted as long as employees deliver productivity and have a high commitment to the signed-up work. 

As long as the purpose of moonlighting is positive and can set an hourly wage, an employee shouldn’t be restricted from practicing the trend. 

Reports show this ongoing work trend is sparkling among the remote working modes. IT giants like Wipro terminated 300 workers as their competitors employed them, which fueled the situation.

This is how it poses a challenge to the IT sector. As people get the option of working from home, they have free time and a chance to make the best use of it and earn money. 

What is Moonlighting At Work?

Moonlighting at work is when someone takes on a second job or side hustle while still working a full-time gig. Think of it as juggling your main 9-to-5 with a little extra action on the side—usually done after hours or on weekends. People moonlight for all kinds of reasons: extra cash, exploring a passion, or just to shake things up from their regular routine.

Picture this: Rita is a software developer by day. She codes away from 9 to 5, but in the evenings, she becomes a web design wizard, freelancing for small businesses.

Why’s she doing it? She wants to save up for a big trip to Europe and flex her creative muscles with design. It’s going great—until one night she pulls an all-nighter on a freelance project and ends up missing a big deadline at her day job. Uh-oh!

Delving Deeper into the Concept of Moonlighting

Moonlighting is a source of extra income besides main employment. An employee hired for a company works for another organization, working on the same project.

The moonlighting employees can do app development, content writing, running a campaign, and others based on employee skills and knowledge. Moonlighting employees are free to pursue the additional task on their own, provided it doesn’t interfere with their regular schedule and offers some additional benefits. 

The moonlighters may face time constraints and often feel detached from their official company. This happens when folks spend only half their efficiency on their company work and try to focus simultaneously on the extra work. It can often lead to less productivity and dedication. Juggling and balancing the two become tricky here.

Also Read: The Essential Guide to Employee Productivity in a Hybrid Setup

Moonlighting in IT 

The ongoing practice of moonlighting has posed a threat to IT giants, making them come up with steps to deal with it. Reports show that 64% feel that moonlighting is ethical and has nothing to do with the loyalty of an employee. Furthermore, recent surveys show how moonlighting changes the mode of remote jobs.     

Recently, Infosys warned employees about moonlighting, saying it can lead to termination. The new company assures that employees shouldn’t engage in moonlighting outside their employment, duly signed by the staff. Otherwise, the situation will lead to a violation of the employee’s code of conduct. Besides, the staff confirmed to put in their effort during their tenure for their present employer only. 

Also Read: 10 Best Employee Retention Strategies to Keep Your Best Talent

IBM clearly states that double employment isn’t ethically correct, and the company won’t tolerate such practices from employees. 

Types of Moonlighting

1. Blue Moonlighting

This is when someone occasionally takes on a side job, but it’s not a regular thing. It might happen when they need a bit of extra cash or have a specific short-term goal, like saving for a vacation. Think of it as moonlighting once in a while, not consistently.

2. Quarter Moonlighting

In this type, people regularly take on side gigs, but only for a few hours a week. It’s more of a part-time thing where they balance their main job with a lighter second job. For example, someone might teach online classes for a couple of hours after their 9-to-5 job.

3. Half Moonlighting

This is when someone dedicates a significant amount of time to their second job, almost half of their workweek, while still maintaining a full-time job. It’s more of a serious commitment. For instance, if someone works full-time in an office and then runs a small business during their evenings and weekends, that’s half moonlighting.

4. Full Moonlighting

This involves managing two full-time jobs. People who do this usually have extremely demanding schedules. They might work a standard 40-hour week in their primary job and then take on another full-time job outside regular hours, like night shifts. It’s intense and often unsustainable for the long term.

Reasons: Why Moonlighting Is Rising?

Moonlighting is here to stay, as employees are operating more from home than from the office. It helps enhance earnings; thus, the trend is becoming a new normal. 

1. Extra Income

This is probably the most straightforward reason. Many employees take on a second job to supplement their main income. They may have financial goals, like paying off debt, saving for a big purchase (house, car, vacation), or covering unexpected expenses.

2. Exploring a Passion or Interest

Some employees moonlight to pursue a passion or hobby that their primary job doesn’t fulfill. For example, someone might work as a software engineer during the day but teach yoga in the evenings because it’s something they enjoy and are passionate about.

3. Building a Side Business

Many people use moonlighting as a stepping stone to entrepreneurship. They start a small side business while keeping their full-time job as a safety net. Over time, if the business grows, they might transition to running it full-time.

4. Need for a backup plan

Having a plan B is one of the primary reasons to practice moonlighting. It grows from job insecurity and works as a backup. As an aftermath of the pandemic, unemployment has become a common concern; people are in search of additional income.  

5. There is no need to hold on to steady jobs

People have realized that work is more than just 9-to-5 jobs. An individual has to work depending on a professional, and projects can be high-paying and other. So, working per need and including some extra work and pay can be beneficial. 

6. Chance of change in career

Job switching may not be that easy at times, and moonlighting is a good option to try a second job while continuing with a regular job. Therefore, moonlighting gives a chance to gather experience in a skill that later yields lucrative employment. 

7. Personal Satisfaction and Diversification

Some employees just enjoy doing multiple things. They may thrive on the variety and challenge of juggling different roles. Moonlighting can also diversify their experience, making them more well-rounded professionals.

8. Cost of Living Pressures

Rising living costs, especially in urban areas, push many employees to moonlight. Even with a full-time job, it can be tough to keep up with expenses like rent, groceries, and transportation, leading many to seek additional sources of income.

9. Ethical moonlighting

Ethical moonlighting is a situation in organizations that creates multiple job opportunities and encourages them to try it. However, organizations must safeguard their company interests with written policies that clearly define the required criteria. Here, companies should prepare for the following:

• Intellectual property 
• Financial interest 
• Competitive advantage 
• Resources like software and laptops        

Why are IT companies against it?

1. Conflict of Interest

• Risk: Employees might work for a competitor or use their expertise to benefit another organization.
• Impact: This can lead to potential breaches of intellectual property or trade secrets.

2. Reduced Productivity

• Risk: Balancing two jobs can exhaust employees, leading to poor performance in their primary role.
• Impact: Missed deadlines, reduced focus, and compromised quality of work affect the company’s output.

3. Confidentiality Issues

• Risk: Employees might inadvertently or intentionally share sensitive company data with their secondary employer.
• Impact: This can result in significant legal and financial repercussions for the primary employer.

4. Resource Misuse

• Risk: Employees might use company equipment, software, or time for their side gigs.
• Impact: This misuse increases costs and disrupts workplace operations.

5. Breach of Employment Contracts

• Risk: Many IT companies have exclusivity clauses in contracts that prohibit additional jobs without prior approval.
• Impact: Moonlighting violates these agreements, making it a disciplinary issue.

6. Security Concerns

• Risk: IT jobs often involve access to sensitive client or project information. Employees working elsewhere may expose systems to vulnerabilities.
• Impact: This can result in cybersecurity risks or breaches.

Example in Action

In 2022, Wipro terminated 300 employees for moonlighting, citing conflict of interest and a breach of trust. Similarly, companies like Infosys and TCS have made it clear that moonlighting is unacceptable, as it undermines the company’s interests and ethical standards.

How to Deal with Moonlighting Employees?

Is firing the right move to deal with moonlighting employees? Though every employee needs to abide by employment contracts, the option of firing the employee is too early to decide. Let us shed some light on ways to deal with it. 

1. Share the Consequences with Employees

If employees know that they are doing something wrong or employers don’t know of employees’ moonlighting practices, employers should convey that they trust the team. Try to share that the company is concerned about employees’ well-being and values trust. Besides, remind them of the consequences of moonlighting without knowledge of the company, and authorities can take serious action against them as required. 

Before such a situation arises, communicate with employees openly and honestly. Also, share that other companies may not offer benefits, including vacation, healthcare, and other amenities. By doing so, the employees recognize that the company is highly concerned about its work culture and will discourage moonlighting practices against company policies. 

Also Read: Qualities of a Good Manager: 10 Skills You Need

2. Have a Non-Competing Agreement 

A non-compete agreement is essential to have before hiring a candidate. These can protect the company’s intellectual property, reduce competition, and prevent workers from engaging with other projects or working for competitors. This agreement should mention a prohibition when looking for employment elsewhere while employed in a company. If employees are found to be working on two company projects, strict action will be taken against disclosing any confidential data or even more.  

Employers can use the agreement against employees engaged in moonlighting. In addition, the contract can limit an employee’s ability to work for another company outside of their official work. This is how the company can minimize risk and avoid unethical workplace policies.

3. Employees Should Understand the Company’s Moonlighting Policy 

Employees should be aware of the policies and limits set by the company. To make sure that every employee is aware of it, mention the brief in the company’s overview section with other policies. Besides, mention how the company will handle employee moonlighting cases per the policy. 

Industry experts suggest IT giants look at their active policies and develop an approach to deal with moonlighting. They can do this by setting performance expectations, protecting confidential company details, and others.  

4. Use Employee Engagement Software 

The employee engagement software can track an employee’s performance, productivity, and engagement levels. It helps managers track the work activity of employees and identify any signs of moonlighting. 

Employers can get information on whether some employee works for another company or pass on sensitive information outside of working hours.   

5. Ask Questions Regarding Moonlighting 

If you already know what your employees are doing or what to find out, ask them directly about it:

• Are you into some new projects outside our team?
• Are you engaged in other work outside normal office hours?
• Can we help you balance work here? 

Ask them questions and make them comfortable so that they feel free to discuss why they are into moonlighting. The more they are comfortable expressing actual reasons for moonlighting, the better you know what makes them happy. Based on this, you can take action to alleviate their concern that their full-time job will be sufficient financially. 

How Does Moonlighting Affect Organizations?

1. Decreased Productivity and Focus

One of the most common negative impacts of moonlighting is reduced productivity. Employees juggling two jobs may become fatigued, leading to decreased focus and performance in their main role.

Example: An employee working late nights on a side gig might show up to their primary job tired, making more mistakes or being less efficient during working hours.

2. Conflicts of Interest

Moonlighting can create conflicts of interest, especially if the employee is working for a competitor or in the same industry. This can lead to a potential risk of sharing sensitive company information or using company resources for personal gain.

Example: A software developer working for two competing tech companies might unintentionally (or intentionally) share trade secrets, which could harm both companies.

3. Higher Risk of Burnout

When employees moonlight, they often stretch themselves too thin, increasing the risk of burnout. This not only affects their long-term health but can also result in higher absenteeism or turnover rates.

4. Decreased Engagement

Employees who are moonlighting may be less engaged in their primary job, as their attention is divided. This can lead to a lack of commitment to team projects, lower participation in meetings, and overall reduced enthusiasm for company goals.

5. Retention Challenges

Employees who moonlight for personal growth or financial reasons might eventually decide to leave their primary job if their side gig becomes more lucrative or satisfying. This can create retention issues for the organization, leading to turnover and additional costs to recruit and train new employees.

Example: If a software engineer starts a profitable app development side business, they might eventually resign from their full-time position to focus entirely on the business.

Tips to Prevent Moonlighting by Employee (with examples)

1. Offer Competitive Compensation

One of the main reasons employees moonlight is to make extra money. Ensuring that your compensation packages are competitive and fair can reduce the financial need for a second job.

Example: If your employees are struggling with high living costs, consider periodic salary reviews or offering bonuses based on performance, making them feel valued and financially secure.

2. Create Career Growth Opportunities

Employees might seek side gigs if they feel stuck in their current role. Offering clear paths for growth, development programs, or mentorship can keep them focused on their primary job.

Example: Implementing a mentorship program or creating internal opportunities for promotions can help employees see a long-term future with your company.

3. Provide Flexible Work Arrangements

Offering flexibility with work hours or remote work options can help employees balance their lives better without needing to take on additional jobs.

Example: Allow employees to work remotely or choose flexible hours, so they have more time for family or hobbies instead of looking for side gigs.

4. Enhance Employee Engagement

A lack of engagement at work can lead employees to seek more fulfilling opportunities outside. Focus on creating a positive, motivating workplace where employees feel connected to the company’s mission.

Example: Introduce team-building activities, recognition programs, or make work more meaningful by assigning them projects that align with their skills and interests.

5. Open Communication Channels

Employees may be moonlighting because they feel disconnected or dissatisfied but haven’t voiced it. Encouraging open communication can help address any issues before they lead to moonlighting.

Example: Conduct regular one-on-one check-ins with employees to discuss their workload, well-being, and career aspirations. This helps to catch any dissatisfaction early.

6. Work-Life Balance Initiatives

If employees are overworked or stressed, they may look to moonlight to regain some control over their time. Promoting a healthy work-life balance can prevent burnout and the need for extra work outside the office.

Example: Encourage employees to take their vacation days, avoid excessive overtime, and offer wellness programs to ensure they don’t feel the need to moonlight for mental or financial escape.

7. Recognize and Reward Efforts

Employees who feel undervalued may seek validation and reward outside of their primary job. Recognizing their hard work and contributions through incentives or public recognition can keep them engaged.

Example: Introduce ‘Employee of the Month’ programs, performance bonuses, or peer recognition platforms to make sure employees feel appreciated.

Final Thoughts 

While an employer needs to respect employees’ need to engage with more than one job, there are situations in which moonlighting can have negative effects on the company.

Beyond company policies, HR should ensure that employees are aware of their limitations outside their employment in the office. So, when it comes to addressing moonlighting workers, focus on what is legitimate and the employment-relating concerns.

If a company is experiencing moonlighting problems and doesn’t know how to deal with them, it should frame a legal structure, defining norms and rules before things go out of control.

Frequently Asked Questions

What is the meaning of moonlighting?

Ans. Moonlighting refers to the practice of working more than one job at the same time, typically involving a second job outside of one’s regular working hours. It allows individuals to supplement their primary income and earn extra money.

Is moonlighting legal?

Ans. The legality of moonlighting depends on various factors, including employment contracts, company policies, and local labor laws. Some employers may prohibit moonlighting due to potential conflicts of interest or concerns about employee productivity. Employees need to review their employment agreements and seek clarity from their employers to ensure compliance with any restrictions.

How should employers address moonlighting concerns?

Ans. Addressing moonlighting concerns requires open communication and clear company policies. If prohibiting moonlighting, employers should explain the reasons while considering individual circumstances. Promoting work-life balance and addressing productivity concerns are essential for the effective management of moonlighting employees.

How do I know if my employee is moonlighting?

Detecting moonlighting can be challenging, but certain signs may indicate an employee has a second job:

• Decreased Productivity: A sudden drop in performance or an increase in errors can be red flags.
• Increased Absenteeism: Frequent unexplained absences or tardiness might suggest they’re juggling another job.
• Behavioral Changes: Noticeable fatigue, lack of focus, or changes in work habits can be indicative.

Employers can also implement clear policies requiring disclosure of any secondary employment to maintain transparency.

What is an example of moonlighting in real life?

Consider Pat, who works full-time in customer service from 9 a.m. to 5 p.m. On Tuesdays and Thursdays, Pat teaches ballet classes at a local studio from 6 p.m. to 9 p.m.

Is moonlighting good or bad?

• Pros:
  • Additional Income: Helps employees meet financial goals.
  • Skill Development: Offers opportunities to learn new skills.
  • Pursuing Passions: Allows engagement in personal interests.
• Cons:
  • Reduced Focus: May lead to decreased performance in the primary job.
  • Conflict of Interest: Potential breaches of confidentiality or loyalty.
  • Health Implications: Increased risk of burnout and stress.

The impact of moonlighting largely depends on individual circumstances and company policies.

What is blue moonlighting?

Blue moonlighting occurs when employees find it challenging to manage a second job alongside their primary one, leading to unproductivity in one or both roles.

 Which company allows moonlighting?

Some companies have policies permitting moonlighting under certain conditions:

• Swiggy: Introduced a policy allowing employees to take up external projects during non-work hours, provided there’s no conflict of interest.
• Tech Mahindra: CEO C.P. Gurnani expressed openness to moonlighting, emphasizing transparency and no conflict with primary job responsibilities.
• Google: Many Google employees have famously launched startups or pursued side hustles under the company’s open innovation culture.

How do companies check for moonlighting?

Companies may use various methods to detect moonlighting:

• Performance Monitoring: Observing declines in productivity or changes in behavior.
• Background Checks: Reviewing employment records for overlapping job histories.
• Network Analysis: Monitoring company network usage for signs of external job activities.

Is moonlighting legal in Wipro?

Wipro has taken a firm stance against moonlighting. In 2022, the company terminated 300 employees found to be working simultaneously for competitors, citing it as a violation of company policy.

Is moonlighting a crime in India?

Moonlighting isn’t a criminal offense in India. However, it can breach employment contracts, especially if there’s a conflict of interest or confidentiality issues, leading to potential termination.

Is freelancing also moonlighting?

Yes, freelancing can be considered a form of moonlighting if it’s done alongside a full-time job. It’s essential to ensure that such activities don’t conflict with primary job responsibilities or violate company policies.

Understanding the nuances of moonlighting helps in navigating its implications effectively, both for employers and employees.