What is moonlighting?
Moonlighting refers to when an employee has a second job outside of their primary employment. This second job is often done without the knowledge or consent of the primary employer. Some common examples of moonlighting include:
- A full-time office worker who does freelance design work on evenings and weekends
- A retail employee who drives for a rideshare service after their shift ends
- A nurse who picks up extra shifts at another hospital in their free time
There can be many motivations behind moonlighting. The most common reasons are to earn extra income, develop new skills, or transition into a new career. However, moonlighting can also present risks for both employees and employers.
The risks of moonlighting for employers
As an employer, finding out an employee is moonlighting can be concerning. Here are some of the potential risks:
Decreased productivity and focus
An employee working a second job in their free time may come into work tired, distracted, and less productive. Their focus is divided, and they may be physically and mentally exhausted from working two jobs. This can result in mistakes, missed deadlines, and subpar work quality.
Increased absences and tardiness
Moonlighting employees are more likely to call out sick, arrive late, or need to leave early from their primary job. This inconsistent scheduling can be very disruptive for employers.
Higher turnover rates
Many employees moonlight as a way to transition into a new career. Once the second job takes off, they may quit their primary job. Even if they stay, burnout from working two jobs often leads to higher turnover.
Conflicts of interest
There may be a conflict of interest between an employee’s two jobs, like working for a competitor. Company information might also be shared or client poaching attempted.
Workplace injuries
An exhausted employee is more likely to have a workplace accident or injury. This increases workers’ compensation costs and liability for the employer.
Reputational damage
If clients find out an employee is dividing their time, they may see it as unprofessional. It could hurt the company’s reputation and business.
Best practices for dealing with employee moonlighting
If you discover an employee has been moonlighting, here are some tips for responding:
Review company policies
First, revisit your policies around outside employment. Make sure there is clear language prohibiting unauthorized moonlighting and outlining disciplinary action. Having a policy provides backing for any decisions.
Gather information
Ask the employee about the duration, nature, and hours of their second job. See if there is a conflict of interest or negative impact on performance. They may have a reasonable explanation.
Be direct about expectations
Have a candid talk about expectations. Explain the problems caused and needed changes. Make your policies and expectations clear for the future. Consider putting the employee on a Performance Improvement Plan.
Decide on appropriate action
If their performance has suffered or they violated policies, disciplinary action may be warranted. First offenses often result in a warning. More serious or repeat violations may require suspension, demotion, or even termination.
Offer support
Find out why they felt the need to moonlight. Offer resources to improve their situation like higher pay, flexible schedules, or career development. Supporting employees reduces the need for a second job.
Document everything
Keep documentation of all conversations, policies reviewed, and disciplinary actions issued. Thorough documentation protects the company against legal action.
Communicate expectations clearly
Reiterate that any moonlighting going forward must be expressly allowed by management. Outline the consequences for violations like termination. Clear communication prevents confusion.
Conduct training
Provide training across the company on policies around moonlighting. This reduces the risk that other employees will make the same mistake.
When employee moonlighting may be allowed
In some circumstances, allowing limited moonlighting under certain conditions can be beneficial:
- The second job does not compete directly with the employer’s business
- It does not interfere with the employee’s availability, work hours, duties, or performance
- The employee arranges it outside of work time and duties
- The extra income allows retaining employees who might otherwise leave
- It provides development opportunities to strengthen employees’ skills
If moonlighting meets the above criteria, having employees sign an authorization form is recommended. This ensures both parties understand the terms and limitations. But any authorized moonlighting should be carefully monitored and revoked if issues arise.
Alternatives to moonlighting
Rather than working a second job, encourage employees to speak to you about the motivation behind moonlighting. There are often ways to meet employee needs without them taking on extra jobs:
Higher pay
If employees are moonlighting for extra income, review their wages and consider raises to better compensate them.
Schedule flexibility
Allow adjustments to schedules that provide time for school, family, or other needs outside of work.
Career development
Create training, mentoring, and development opportunities to help ambitious employees build skills for advancement.
Other benefits
Consider adding or enhancing other benefits like more paid time off, tuition reimbursement, or wellness programs.
Open communication
Foster a culture where employees feel heard and comfortable openly communicating about their needs and goals.
By addressing the root causes, employers can reduce the desire for moonlighting while improving loyalty, engagement, and retention.
Handling special cases
Certain employee situations may require extra care when addressing moonlighting:
Part-time employees
Part-time employees are more likely to need extra income. Make expectations clear, but understand scheduling conflicts may occur.
Remote employees
It’s harder to monitor remote employees. Clear communication about policies and checking in on availability are key.
High-turnover roles
Frontline and shift-based roles often have high turnover. Moonlighting is common, so training for all employees on policies is crucial.
Highly skilled employees
Be cautious with disciplinary action for highly skilled employees, who are harder to replace if they quit. Additional flexibility may be required.
Management or executives
Higher-level employees moonlighting in a related field is a serious conflict of interest. Termination may be warranted.
Conclusion
Finding the right approach when an employee is moonlighting requires balancing employer risks with employee needs. Keep company policies clear, communicate expectations directly, document everything, and provide alternatives like career development. With the right response, moonlighting can often be channeled in a direction beneficial to both the employee and employer.