Is India ready for the concept of moonlighting?

After Wipro fired 300 staffers for allegedly “working for rival companies” while being on the company payrolls, moonlighting became the talk of the town, with memes, posts, and opinions going viral on social media. Employees and employers got divided into two schools of thought — one stating it as unethical and illegal, while the other defending the practice with their financial need.

Moonlighting is working for a business of the same niche while being a permanent employee of another. Many IT sector employees moonlight “secretly” for financial benefits outside their working hours. Post-pandemic, the practice gained momentum due to remote working and reduced job security. Over 43% of employees find dual employment favourable to safeguard their earnings even if their permanent source of income is lost.

How does India perceive moonlighting?

Although moonlighting is popular in America, many companies in India are framing strict policies to refrain workers from working elsewhere. Especially in the IT industry, employers try to bind their workers with strict clauses regarding dual employment in their joining letters or through clear-cut company policies. For example, top IT companies like IBM and Infosys have “warned” their employees for moonlighting and find it “cheating — plain and simple.”

However, some companies consider moonlighting as the “future of work”, as 78% of corporates find talent acquisition and retention challenging. As a result, the food delivery chain Swiggy has allowed employees to work on other projects outside their working hours or during weekends that do not hamper their productivity to compensate for the gap in skills and remuneration.

Though the concept is controversial and stirring debate among employers and workers, there’s no defined law against moonlighting in the Indian constitutional framework. There is a restriction on dual employment in the Factories Act 1948 (Amended in 2016) for labourers working in plants and factories. But the law doesn’t encompass IT employees or workers outside the factory setting. Again, the Industrial Employment (Standing Order) Rules 1946 restricts workers from accepting additional employment that may harm the interest of their employers. But the Industrial Relations Code permits a worker to take up extra assignments at the discretion of his employer. Moreover, India’s Prime Minister highlighted the need for flexible working practices to acknowledge gig workers in the upcoming labour codes.

In such a scenario, moonlighting is gaining popularity, especially among millennials and Gen Zers who live in financial anxiety in the “competitive, ruthless, and highly under-equipped” corporate world. 64% of full-time millennial workers want to opt for the gig economy, and 37% are likely to switch employers if they’re not allowed to moonlight.

Who wins the corporate cat-and-mouse game?

Corporate leaders believe that moonlighting has increased after the work-from-home model came into existence. The economic turbulence during the Covid mobilised employees towards extra earnings through part-time jobs, freelancing, contractual working, or consultancy. Additionally, working from home gave them enough liberty and free hours to take up other opportunities apart from their full-time commitment.

While 65% of HR experts in the IT/ITES space claim to know about the part-time commitments of their workers while working from home, the majority consider a second job to be illegal, against the company policy, shifting towards daylighting, and conflicting with company interests. Consequently, 90% of the companies have asked their employees to resume working from the office, while 42% of employees announced quitting jobs if they’re not allowed to work from home.

Though 81% of employees prefer remaining loyal to their companies, at least 4 out of 10 workers are keen to practise side hustles to earn more, pay off debts, follow their passion, and evade boredom. Companies mainly identify dual income sources for their employees through their Universal Account Number (UAN) of the Employees’ Provident Fund (EPF). Creating two PF accounts is practically impossible for an employee, and two or more PF contributions in the same account indicate moonlighting directly.

However, tracking double employment is difficult in the case of freelancing or contractual jobs where no PF facility is available. In that case, an employer can earmark a breach of policies if the employee uses the same company laptop or organisational tools for moonlighting or the same bank account for depositing remuneration. Employers can also track moonlighting with new-age technologies or deploy third-party agencies for background checks. They can warn or sack them for compromised productivity, leakage of critical data, misuse of company resources, or conflict of interests.

What should companies do to prevent moonlighting?

Though moonlighting can be tough to identify and handle, companies can reduce the growing need for moonlighting by paying the appropriate remuneration, offering incentives and appraisals, rewarding employee performance, and using productivity tools to track employee working time. They should have a precise ‘moonlighting policy’ to convey the company’s expectations from an employee clearly and should take disciplinary actions only after warning the employees for consistently poor performance.

Moreover, hiring a workforce from a trusted source is essential to address the pain point at its core. Enterprises should rely on market-leading talent management agencies to acquire full-time resources or associate on a contractual basis. These platforms offer end-to-end staff management services like global search and selection, permanent recruitment, contract staffing, and HR assistance. They design and implement apprentice programs to train newly hired employees, save recruitment expenditures, and reduce workforce attrition. Such holistic support from professional networks can help overcome HR pain points and boost employee loyalty for business growth.

Final say

Moonlighting is a boiling concern in India that allures 73% of the workforce to take multiple jobs for financial benefits. Over time, companies will suffer from employee disengagement, low productivity, revenue loss, and confidentiality breaches. Thus, setting up a concrete moonlighting policy, satisfying employees with the right job roles and compensation, and partnering with highly-skilled talent management agencies for recruitment are the needs of the hour. Such steps will help fill the skill gap and empower businesses to track dual employment for efficient people management.

Note: This article by Vidur Gupta, was originally published in TOI