Introduction
In recent years, the practice of dual employment, commonly referred to as “Moonlighting”, has sparked debates across India. With professionals increasingly taking on multiple jobs to boost their income or pursue different interests, moonlighting has moved from being a prohibited activity to a growing trend. However, this practice raises significant legal and ethical questions, particularly as it pertains to employment contracts, intellectual property rights, and workplace regulations. While moonlighting may offer financial flexibility and personal growth opportunities, it also carries risks that can lead to legal challenges for both employees and employers. This article delves into the legal coverage and implications of dual employment in India.
KEY PROVISIONS
The legal framework governing dual employment, or moonlighting, in India is influenced by several labour laws that indirectly prohibits the practice of moonlighting. Some key provisions related to dual employment include:
- Factories Act, 1948: Section 60 of the Factories Act explicitly prohibits an adult worker from being required or allowed to work in any factory on a day when they have already worked in another factory.
- Industrial Employment (Standing Orders) Rules, 1946: Para 8 of Schedule I-B of these rules stipulates that a workman shall not at any time work against the interest of the industrial establishment in which he is employed and shall not take any employment in addition to his job in the establishment, which may adversely affect the interest of his employer.
- Occupational Safety, Health and Working Conditions Code, 2020: Section 30 of this Code mandates that no worker is permitted to work in a mine or factory if they have already worked in a similar establishment within the preceding twelve hours, unless specified exceptions are prescribed by the appropriate government.
- Model Standing Orders for Service Sector, 2020: Clause 22 of these standing orders deals with exclusive service, under which a worker shall not at any time work against the interest of the industrial establishment in which he is employed and shall not take any employment in addition to his job in the industrial establishment, which may adversely affect the interest of his employer. However, a worker may engage in additional employment, with or without conditions, after obtaining permission from their employer.
- State Specific Labour Laws:Various states in India have enacted specific labour regulations that further address moonlighting. For instance:
- Delhi Shops and Establishments Act, 1954: Section 9 of this Act prohibits any person from working in more than one establishment or in both an establishment and a factory beyond the legally allowed working hours as per the provisions of the Act.
- Andhra Pradesh Shops and Establishments Act, 1988: Section 69 of this Act states that no employee shall work in any establishment, nor shall an employer knowingly allow an employee to work, on a day or part of a day when the employee is on leave or holiday as per the provisions of the Act.
IMPLICATIONS OF MOONLIGHTING IN INDIA
The practice of moonlighting or dual employment, where individuals take up secondary jobs alongside their primary employment, may seem like an opportunity for professional growth and extra income. However, it carries a host of implications that can pose significant risks to both employees and employers. Below are some key concerns:
Breach of Employment Contract
One of the most immediate legal risks for employees engaging in moonlighting is the potential violation of their primary employment contract. Many employment agreements contain clauses that explicitly prohibit employees from taking up additional work without prior approval from the employer. Violating these clauses can lead to legal action, including termination of Employment, Breach of Trust and Confidentiality etc.
Conflicts of Interest
Dual employment can often lead to conflicts of interest, especially when an employee works for a competing company or engages in work that may undermine the interests of their primary employer. The legal consequences of such conflicts include:
- Breach of Fiduciary Duty: Employees have a legal obligation to act in the best interests of their employer. If they take on secondary employment in a similar industry or a competitor, they could be accused of failing to uphold this duty.
- Unfair Advantage: Employees may gain access to confidential business information in their primary job and use it to benefit their secondary employer, which could lead to claims of unfair competition or misuse of intellectual property.
Intellectual Property and Confidentiality Issues:
Moonlighting employees may inadvertently expose their primary employer’s intellectual property (IP) to unauthorized use. Many employment contracts contain provisions related to IP and confidentiality, stating that any invention, design, or work created during the course of employment belongs to the employer. If employees work for competing firms or develop similar products during their moonlighting hours, they may be accused of breaching IP rights, even if the work was created outside regular office hours.
Taxation Issues:
Employees involved in dual employment may also face tax-related complications. The income from secondary employment is taxable, and employees must report it to tax authorities. Failure to do so could result in Tax Evasion. Individuals who earn from multiple sources may fall into a higher tax bracket, leading to a higher tax liability. The failure to properly file tax returns could attract penalties and interest charges.
Overworking and violation of Labour Laws:
Excessive working hours are a common concern when employees take on dual jobs. In India, labour laws such as the Factories Act, 1948 and the Shops and Establishments Act regulate the working hours of employees. When employees work multiple jobs, they may unintentionally exceed the maximum permissible working hours, leading to violations of labour laws.
KEY CONSIDERATIONS FOR EMPLOYERS
As moonlighting continues to rise in popularity, it’s becoming increasingly important for employers to establish clear policies regarding dual employment within their HR guidelines. These policies can help manage both the opportunities and potential risks that come with employees holding multiple jobs. Given the unique nature of each business, companies should tailor their approach based on their operational needs and the nature of the roles involved. Key steps employers can take include:
Disclaimer
The information provided in this article is intended for general informational purposes only and should not be construed as legal advice. The content of this article is not intended to create and receipt of it does not constitute any relationship. Readers should not act upon this information without seeking professional legal counsel.
