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What is Moonlighting? Is Moonlighting Legal in India?


Moonlighting is not a new concept but has drawn much attention these days particularly after receiving a diversified response from several IT companies in India. The trend of moonlighting in which employees perform multiple jobs simultaneously is been rising in the nation, mostly in the IT sector. The trend had been highlighted by a food delivery app Swiggy that allowed its employees to moonlight or engage in more than one job outside their work hours or during weekends.

As compared to Swiggy, Wipro company chairman Rishad Premji considers moonlighting as ‘cheating’ while ex-Infosys director Mohandas Pai asserts that what a person does after his duty hours is his/her choice. Pai believes that an employment contract contains elements that describe employers’ relations with employees like pay structure for working particular hours a day. He said in an interview, “Employment is a contract between an employer who pays me for working for them for ‘n’ number of hours a day. During that time, I have to abide by their conditions, including client confidentiality, and I’m paid for that. At that time, I can’t work for anybody else. Now what I do after that time is my freedom, I can do what I want.”

Subsequently, Tech Mahindra’s CEO and MD CP Gurnani said that he might implement a moonlighting policy in his firm if given a chance but employees must be open about it. However, all companies operating in India do not have a similar viewpoint. For instance, a few companies said that if their employees are found moonlighting without informing the company, legal actions would be taken against them.

What is Moonlighting?

Moonlighting is a practice in which employees work for a second job outside normal business hours. An employee can work normally from 9-5 job for earning basic income but can work afterwards for a different job to get extra money. People working for private organizations are subject to various policies and job contract guidelines including moonlighting policy. Some firms do not want their employees to work outside their company while others do not care at all. One working in government companies also needs to check industry standards and if the government allows them to have two jobs simultaneously or not.

Is moonlighting legal in India?

Overemployment or having dual jobs is legal in countries like UK and America from tax perspectives. However, the second job in the UK can influence employees’ tax regime but not affect the first employer’s payroll system and may be marked unreported by large organizations. US tax system is comparatively simple and based on voluntary reporting and self-assessment. Similarly, a person working in India can do more than one job provided the company employee works in has not mentioned specifically about moonlighting in the job contract.

In India, however, a person doing similar work with another company may be treated as a breach of law or confidentiality violation if the company restricts employees to work with others which could lead to employment agreement terms violation. Moonlighting may be called illegal in case employees’ contracts need a single employment term with their employees which is very common in most employment contracts in India. But if nothing is mentioned in the job contract, moonlighting can be termed legal.

Factories Act in India prohibits dual employment. However, IT companies in a few states exempt themselves from such rules. Therefore, before starting multiple jobs, employees must go through their job contracts carefully to avoid falling into compliance with moonlighting policies.

Why moonlighting is not considered by major companies in India?

In several modern companies, the moonlighting situation is fine for employers and employees. They do not consider highlighting moonlighting policy in the business but many others find moonlighting bad and unhealthy for work productivity. Some of the reasons why Indian companies restrict moonlighting in their job policies include:

Conflict of interest: the second job of employees may create a conflict of interest or confidentiality law violation.

Exhaustion: if employees choose to work after regular duty hours, they may become too tired to work the next day due to a lack of mental and physical rest.

Reduction in work hours: employees may restrict their work hours even during peak season or when their company need it. The second job may not allow employees to work more even if the organization is willing to pay for over-duty.

Interruption: many employees may get distracted during their work hours because of their second job notifications or any important work that needs to be completed. This reduces work productivity as well as quality.

Is moonlighting ethical?

Whether moonlighting is ethical or not is an individual viewpoint. It is considered okay for many people to work for more than one job without causing any issues or consequences to their first job. But in a few cases moonlighting can be unethical, especially when the employee works for another competing firm. The situation can prove stressful for the employee and may lead then to proprietary data breaches for both companies. Hence, ethical moonlighting demands employees to perform work outside their primary organization if they face no negative consequences for themselves or their companies.

What are Moonlighting policies?

In most cases, moonlighting policies are not signed individually as job agreements between employers and employees. It is more like a company set of guidelines and employee policies which is common for all and may be found in the employee handbook. The moonlighting policy usually describes the conditions in which an employee may or may not work for a second job. It also mentions rules for moonlighting like employee information disclosure about the second company which needs to be approved or specific industries which must be avoided by employees for moonlighting.

Can the employer restrict an employee from moonlighting?

Whether an employer can restrict an employee from moonlighting completely depends on the moonlighting policy of the company, if present. In case your company does not have any particular policy regarding moonlighting, and your work for the second company does not impact your work productivity in the first company, you must not hide your work for the second company from your employers. But employers may ask you to leave the job if your second company work or moonlighting violates employment rules or impacts work performance.

How many jobs can I handle concurrently?

Except for workers in factories, there is no stated legal limit on the number of jobs a worker may have as a side gig. Moonlighting is therefore legal for employees as long as it is not prohibited by their employment contract with their current employer.

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