Moonlighting remains one of the most common practices for a wide range of professionals. From making a bit of extra money on the side to starting your own business, there is a wide range of reasons that people decide to moonlight on their own. Our article is going to teach you about moonlighting, its legality, and the most common policies companies have against it.
What Is Moonlighting?
The first step to understanding the legality of moonlighting is to learn what it is. In short, moonlighting occurs whenever you take on a second job. This second job can vary significantly based on your professional nature and any relevant certifications you may have.
For many people, moonlighting may take the form of a seasonal job at a retail chain. This likely occurs during the holidays where you may be wanting to make some extra cash on the side. However, some people take moonlighting to a whole other level. Some examples of moonlighting that is more permanent in nature include starting your own business and offering consulting services.
Both of those examples tend to happen with individuals who have either specific trade skills or who have valuable industry insight in a given business sector. Either way, moonlighting itself is completely legal. However, there are specific situations where your employer may forbid moonlighting. The rest of our article is going to examine these types of situations in greater detail.
The Most Common Company Policies Against Moonlighting
No Competitors
The most common moonlighting policy you will find at most jobs is that you cannot work with a competitor. While this may seem like common sense, these types of policies are designed to keep competitors from benefiting from your unique training and experience. Ultimately, they are designed to protect the main company you work for.
As for what your company defines as a competitor, this can vary significantly. In most cases, companies will define competitors based on those that they directly compete with. In the case of retail chains, this would include other retailers who carry the same types of goods. However, the policy can be expanded to include side businesses and other ventures as well.
What this means is that any service that the primary employer offers could be considered protected. For example, if your employer offers consumer credit cards at their location, working at a financial company could be considered a competitor. When in doubt, it’s always best to consult with HR partners to determine just how far reaching the non-competition policy will be.
No Secondary Employment At All
While this moonlighting policy may seem extreme, it’s often reserved for high-level management and other professionals. The reason this policy is put into place is that it helps ensure that all of a given professional’s attention will remain centered on the company.
Ultimately, this helps guarantee that they will continue to produce top quality work and that all of their efforts will help the company continue to grow. In some rarer instances, lower level employees may be bound by this policy as well.
This is common for businesses that are high-security in nature. This may include financial companies, research organizations, and other groups that tend to have high-level security clearances. By ensuring that employees do not take on secondary jobs, they can help reduce the likelihood that schedules will be impacted and ensure that shifts are adequately staffed at all times.
Notification Requested First
This particular moonlighting policy is usually related to the non-competition reason we discussed first. When an employer request that their employees notify them first before working another job, it’s usually so that they can make sure that it wouldn’t result in a conflict of interest for the business or the employee.
In most cases, these types of policies require that you inform a dedicated HR representative in writing of the nature of your moonlighting gig. Common details that are asked for include the place you will be working at, the duration of the employment, scheduling requirements, and the exact position you will hold.
Using this information, the HR rep determines if the employment could potentially negatively impact the employee’s performance or harm the company. If things look okay, the employee is generally given the green light to proceed with their moonlighting gig.
No Self-employment
While not as common as the other moonlighting policies we have discussed so far, no self-employment is still widely used by many companies. There is a wide range of reasons for this.
One of the biggest reasons is that running your own company takes lots of time, effort, and money. All three of these can have a negative impact on an employee’s performance. In the case of money, this could theoretically create a security risk where the employee could be compromised. This creates a big issue for employees who regularly handle spending accounts and other financial matters.
Intellectual Property Limitations
For individuals who routinely create policies and procedures for their company, there are often limitations placed on the intellectual property that they create. There are policies in place that forbid creating intellectual property for other companies while you are currently employed at your main company.
The reason that these types of policies are in place is to prevent stealing intellectual property while you are employed at your main company. This ensures that any ideas that you create remain the property of your main parent company.
Although it can seem like this policy is a bit extreme, it’s designed to protect the best interest of the main company. It keeps employees from taking ideas that they pick up during their employment and presenting them to other companies for financial gain.
Company Patent Ownership
In the case of engineers and other talented professionals who design equipment and programs, there is typically a policy in place that dictates that all patents must be applied for via the company that they work for. This ensures that any work that is done by them during their employment remains the property of the company.
Ultimately, this prevents employees from selling ideas to outside organizations or from profiting from them themselves. It also ensures that any research that is done in-house will ultimately only benefit the parent company. For lower level employees, this type of policy is typically not as big of an issue or concern.
Drawing To A Close
At this point in our article, you should now understand that moonlighting is completely legal by itself. However, there is a wide range of circumstances where an employer may seek to restrict or eliminate an employee’s ability to moonlight. The decision to put these types of policies in place will ultimately be determined by the type of company that you have and the type of products that you provide.
