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What Is Employee Moonlighting? What does it mean for your business?

What Is Employee Moonlighting What does it mean for your business

Table of Contents

What Is Moonlighting?

Moonlighting is making news in India now, but it has been a surging trend in the US since 1996. The pandemic has only accentuated the problem of moonlighting amongst remote/hybrid employees. Before we dig deeper, let’s understand the concept of moonlighting and why it is picking up.

Moonlighting refers to taking up an additional job in parallel to one’s primary job. These kinds of jobs are taken up secretly by employees while working for their actual job at a workplace. Some businesses have strict rules against moonlighting, they do not permit their employees to work elsewhere along with them while some organisations may not even care what employees are doing post their working hours.

 

What Triggered Moonlighting?

Since the pandemic hit, people have suffered financially. A watershed event in most people’s lives, the pandemic made people think about their lives differently, including their workplaces. Additionally, the hybrid world of work offered opportunities and room to take up an additional source of income. Some people work extra to earn extra whereas some work to enhance their skills, fulfil their passion and utilise their skills in different ways.

Read More :-How to check Dual Employment and Employee Moonlighting

 

Different Types Of Moonlighting

1. Blue Moonlighting – Here the employees get certain benefits that may not be completely satisfying, and the workers opt for a second source of income to fulfill their needs.

2. Quarter Moonlighting – Quarter moonlighting is when the employee is not happy with their salary and ultimately, they end up looking for a part-time job.

3. Half Moonlighting – Employees who want a luxurious lifestyle and save a satisfactory amount for the future, start investing time in a secondary source of income. This is termed half moonlighting.

4. Full Moonlighting – This is when an employee’s salary does not meet their expectations or those whose friends are earning more and enjoying their status, such employees build their own business along with their regular jobs.

Examples Of Moonlighting

  1. Freelance Consulting: A common form of moonlighting is freelance consulting in a professional’s area of expertise. For example, a full-time marketing manager might offer freelance consulting services to startups on digital marketing strategies during off-hours. This type of moonlighting allows professionals to leverage their skills for additional income while enhancing their portfolios.

  2. Creative Projects: Individuals with creative skills often engage in moonlighting by taking on projects such as writing, graphic design, or music production. For instance, a software developer might also be a freelance graphic designer, creating logos and marketing materials for clients on weekends.

  3. Teaching and Tutoring: Many professionals moonlight as teachers or tutors in their field of expertise. A high school science teacher, for example, might offer private tutoring sessions in the evenings to help students prepare for exams or understand complex topics.

  4. Retail and Hospitality Jobs: Moonlighting isn’t limited to professional work. Many individuals take part-time jobs in the retail or hospitality sectors to supplement their primary income. A real-life example is a bank employee working weekend shifts at a restaurant or a retail store.

  5. Ride-sharing and Delivery Services: With the rise of gig economy platforms like Uber, many people moonlight as drivers or delivery personnel. This form of moonlighting offers flexible hours, allowing individuals to work as much or as little as they want, based on their schedules and financial needs.

  6. Real Estate: Some professionals invest in real estate and manage their properties as a form of moonlighting. For example, an IT professional might purchase rental properties and manage them in their spare time, generating passive income through rent.

  7. Crafts and Art Sales: Individuals talented in crafts or art might create products and sell them online or at local markets as a form of moonlighting. This includes handmade jewellery, pottery, paintings, and other crafts that can be marketed to a wide audience.

Is Moonlighting Ethical?

The Indian IT companies stand divided when it comes to moonlighting. While some consider it ethical, others oppose it. There are companies who are totally against it and if found guilty, fire or penalize employees. Others have accepted moonlighting at a policy level. Some of the common concerns around moonlighting are that it can impact employee productivity, could lead to compromise of company culture, and in the worst scenario compromise the data and security of an organization and its employees. Moonlighting can also create a culture of distrust. Whether moonlighting is ethical or not is a subject of great debate, but almost all organizations recommend transparency and honesty where moonlighting is concerned.

Why Are Employers Against Moonlighting?

Employers are generally against moonlighting for a variety of reasons, which can affect organizational integrity, employee performance, and company culture. Here are several well-documented concerns backed by employer testimonials and industry analysis:

  1. Conflict of Interest: Employers fear that moonlighting can lead to conflicts of interest, especially when employees work for competing firms or start their own businesses in the same industry. A notable example is when an employee at a tech firm might develop software or products that compete with their employer’s offerings, potentially diverting business or revealing sensitive strategies.

  2. Reduced Productivity and Fatigue: There’s considerable concern that employees who moonlight may not be as productive due to fatigue or divided attention. For instance, tech companies have stringent policies against moonlighting mainly because they require their employees to commit full intellectual and physical energy to their roles.

  3. Loyalty and Dedication Issues: Employers often view an employee’s decision to moonlight as a lack of loyalty or dedication to the company, which can affect career progression and trust. For example, a manager at a consulting firm might see an employee’s freelance work as a signal that they are not fully invested in the firm’s success, impacting decisions on promotions or key project assignments.

  4. Security Risks: Moonlighting can pose security risks, particularly in industries dealing with sensitive information or intellectual property. There are cases where employees inadvertently share proprietary data with a second employer, leading to significant financial and reputational damage. 

  5. Legal and Compliance Issues: Many businesses operate in highly regulated sectors where non-compliance can lead to legal action. Employers worry that moonlighting could lead to breaches of compliance, especially when employees are unaware of or overlook specific regulatory requirements in their side jobs. Financial services firms, for instance, often require any external work to be pre-approved to avoid breaches of financial regulations.

  6. Impact on Team Dynamics: Moonlighting can affect team morale and cohesion, especially if some team members are perceived to be less available or committed. This can lead to resentment or a decrease in overall team performance, as seen in project teams within IT companies where tight collaboration and quick turnarounds are crucial for success.

How Can Companies Check Moonlighting?

To effectively monitor and check for moonlighting within their organisations, companies can implement several strategies that combine robust policy enforcement with technology-driven monitoring tools. Here’s how companies can manage and check for moonlighting:

  1. Clear Policy Communication: Companies should have a clear and well-communicated policy regarding moonlighting. This policy should define what constitutes moonlighting, under what conditions it might be permitted, and the consequences of non-disclosure. Ensuring every employee understands this policy is crucial for effective compliance.
  2. Contractual Clauses: Employment contracts should include clauses that require employees to disclose any external employment or freelancing activities. This legal approach ensures employees are contractually bound to disclose their engagements outside of work.
  3. Regular Audits and Self-Declaration: Implementing regular audits where employees are required to disclose their current employment status and any external engagements can help track moonlighting activities. These audits can be coupled with self-declaration forms as part of routine HR processes.
  4. Performance Monitoring: Monitoring employee performance for sudden changes can be an indicator of moonlighting. A drop in productivity, frequent tiredness, or less engagement in work activities may suggest that an employee is overextended due to external work commitments.
  5. Technology and Software Tools: Utilizing software tools that track and analyze employee activity during work hours can provide insights into unusual activity. Tools like computer usage monitoring software or email traffic analysis can help identify patterns consistent with moonlighting.
  6. Feedback from Supervisors and Co-Workers: Regular feedback from supervisors and observations from co-workers can provide valuable insights into an employee’s work habits and changes in behaviour. This feedback can be instrumental in identifying potential cases of moonlighting.
  7. Confidential Reporting Systems: Establishing a confidential reporting system encourages employees to report any suspected cases of moonlighting discreetly. This can help in identifying cases that might not be immediately obvious through regular monitoring.
  8. Legal and Compliance Checks: Finally, ensuring that all monitoring and tracking activities comply with local labour laws and privacy regulations is crucial. Employers should consult legal experts to balance effective monitoring practices with respect for employee privacy and rights.

Moonlighting And Sunlighting

Moonlighting and Sunlighting refer to the practices of holding additional jobs outside of one’s primary employment, but they differ in terms of when and how these jobs are performed.

Moonlighting

Moonlighting involves taking on extra work outside of normal working hours, often in the evenings or on weekends. This term originally referred to people taking on these additional jobs covertly under the “moonlight,” but it has come to encompass any additional job outside of an individual’s main source of income.

Examples of Moonlighting:

  1. Tech Professionals Freelancing: An IT professional might work a typical 9-5 job but take on freelance coding or consulting projects during the evening.
  2. Healthcare Workers: A nurse working in a hospital might pick up extra shifts at a different clinic or even offer private caregiving services on their days off.
  3. Teachers Tutoring: Teachers often tutor students or teach evening classes in subjects where they have expertise.

Sunlighting

Sunlighting, on the other hand, is similar to moonlighting but typically occurs during regular daytime hours. This type of work can include part-time jobs or gigs that overlap with normal working hours but do not conflict with the primary job’s responsibilities or schedules.

Examples of Sunlighting:

  1. Remote Work Overlaps: With the rise of remote work, some employees might take on additional roles during the day that don’t interfere with their primary job’s responsibilities. For instance, a graphic designer might work for two companies simultaneously, managing time and deliverables to meet both roles’ demands without conflict.
  2. Academic Professionals: University lecturers or researchers might work on personal academic projects, such as writing books or conducting independent research, which can sometimes even enhance their primary job’s value.
  3. Business Ventures: An individual might run a small business or startup while maintaining a full-time job, as long as the business activities can be managed during typical office hours, such as an online retail store.

Key Considerations

Both practices raise various considerations regarding work-life balance, productivity, and potential conflicts of interest. Employers generally require transparency about such activities, especially when the secondary employment might impact the employee’s performance or compete with the employer’s interests.

  • Legal and Ethical Considerations: Both moonlighting and sunlighting must be managed carefully to avoid breaches of contract. Many employers have policies that restrict secondary employment, particularly if it poses a conflict of interest.
  • Work-Life Balance: While these practices can significantly increase income, they may also lead to burnout if not managed properly. It’s important for individuals engaging in moonlighting or sunlighting to monitor their health and well-being closely.

Here Are The Top Media Highlights on Moonlighting:

  • Infosys warns employees on moonlighting, says could lead to termination.
  • Wipro sacked around 300 employees for ‘moonlighting’ as this IT services firm toughened its stand against staffers taking a second job after work hours. Its chairman Rishad Premji said the company has no place for any employee who chooses to work directly with rivals while being on company payrolls.

“There is no Diet Coke employment; you can’t have the security of permanent employment & moonlight too,” says, Manish Sabharwal, Teamlease.

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Frequently Asked Questions (FAQs) On Moonlighting

What Is Moonlighting?

Moonlighting refers to the practice of holding an additional job or jobs outside of one’s main employment. This often occurs during off-hours, hence the name ‘moonlighting’, suggesting work done after dark or during free time.

How Does Moonlighting Affect Taxes?

Income from moonlighting is taxable. You must report all earnings from secondary jobs on your tax returns. It’s recommended to consult with a tax professional to ensure compliance and proper filing, especially if you are managing multiple income sources.

What should I consider before starting to moonlight?

Before starting to moonlight, consider your current job’s workload, the terms of your employment contract, and personal life commitments. Evaluating the potential impact on your time and energy is crucial to ensure that moonlighting is a beneficial endeavour.

Can my employer fire me for moonlighting?

Yes, if moonlighting violates the terms of your employment contract or significantly impacts your job performance, your employer may have grounds to dismiss you. It’s crucial to understand your company’s specific policies on secondary employment.

How can moonlighting impact my career growth?

Moonlighting can enhance your career by expanding your skills and experience. However, if not managed well, it can also lead to burnout and decreased performance at your primary job, potentially stunting your career progression.

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