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Organisations need to have a firm grasp on the concept of moonlighting and be able to articulate their position on the practise before they can create an effective policy about it.

The new ways of working have led to organisations rethinking modern workplace policies. Moonlighting is one such area that is gaining popularity these days. “Moonlighting” may be defined as the practice of working for another organisation while committing oneself to one company as the primary workplace typically without the employer’s knowledge.

Instances of moonlighting can be categorised under two buckets:

Non-conflicted moonlighting: Zero or minimal overlap of time/professional commitments between the sources of employment an individual has. The employee is abiding by the ethical construct of the corporate culture.

Conflicted moonlighting: Violating time, professional, ethical or code of conduct commitments towards both the concurrent sources of employment along with direct and apparent conflict of interest.

Instances of conflicted moonlighting are on the rise across industries and are a common concern among employers.

While organisations are looking to manage moonlighting, the working model plays a vital role. It is imperative to understand and consider new and different families of roles:

Virtual working: Employees are required to work remotely, and leverage cloud-based online collaboration tools for carrying out their jobs.

Flexi hours: Employees with pressing personal commitments outside of their primary employment may opt to dial down work.

Hybrid working: Employees are required to partially be present in the office and partially work remotely based on their job requirements.

Work on site: Employees are required to work on-site only. These are predominantly adopted in manufacturing, and essential services sectors.

Neo Gig: Exclusive contracts with professionals such as specialists and freelancers to deliver projects over 2 to 3 years.

Gig: Secondary employment options such as vendors/contractors/freelancers who work with organisations on short-term projects.

In the on-site work arrangements, there is higher visibility and lower bandwidth available with the employees to engage in moonlighting compared with virtual and hybrid ways of working. Similarly, while moonlighting is common for Gig workers, it is not as common for Neo-Gig workers as they have exclusivity agreements. Instances of moonlighting are rare with employees working flexi-hours on their primary jobs.

Organisations also need to look at this from the employees’ lens. Employee mindsets can be broadly categorised as follows:

Learner:  Wants to learn new things, explore new areas and is intrinsically motivated.

Performer:  Strives for excellence in their performance and seeks validation for the same.

Community contributor:  Wants to contribute to society at large apart from their profession.

Passionate/hobbyist: Inclined towards following their hobby/passion beyond their regular job.

Entrepreneurial: Wants to explore opportunities of their own, extremely motivated, and independent.

As the next step for organisations is to understand and assess the factors/risks that would need to be considered to take a stance on moonlighting and further effectively managing their employee base. Following are a few potential risks for companies to consider ring-fencing and managing moonlighting:

Non-compete/conflict of interest – Managing conflict in the sources of employment by having a robust policy which prohibits the same.

Data privacy – Ensuring that the organisation has safeguards in place to prevent the transfer of confidential information. This could also expose the firm to data leakage, including leakage of unpublished price-sensitive information.

Non-compliance – Certain regulatory compliances might need to be followed by law for certain roles.

Employee productivity – Employees might lose productivity if their mind space is occupied by multiple tasks at once.

Conflicting priorities – Multiple responsibilities might lead to employees being distracted while performing the tasks they are supposed to, under their primary employment.

Legalities around company-licensed software – Most organisations are leveraging licensed tools, which could be leveraged for performing activities of another job.

Seepage of ROI – Reduced ROI for firms if employees are leveraging their proficiencies on multiple avenues.

Deterioration in performance of critical roles – The performance of employees with critical influence on the firm’s big-picture decisions might get affected.

How should organisations proceed:

Moonlighting verification and as-is impact assessment – Conduct an as-is assessment for all roles in the organisation. Define clear parameters basis which the impact of employees holding those roles moonlighting can be assessed.

Role based – Moonlighting risk assessment – Assess the impact of moonlighting based on the defined parameters on various roles existing in the firm.

Moonlighting Mitigation Strategy Design – Based on the anticipated impact for each of the roles, devise a moonlight mitigation strategy in alignment with all relevant stakeholders.

Re-design of Operating Model, HR Policies and Process manuals – Align the operating model and processes based on the moonlight mitigation strategy.

Leadership Assurance Dashboard/Policy Governance Controls checking – Analyse and devise process checkpoints to monitor moonlighting.

Employee Engagement Survey – Run an employee survey to capture engagement levels. A highly engaged workforce mitigates the risk of moonlighting.

Since the concept of moonlighting has gained popularity, there are many opinions that have emerged around it and different firms have taken different stances on the same. There is a constant debate from legal and ethical perspectives. No matter what stance a firm takes, the fact remains that moonlighting is an evident reality of today’s job environment and is here to stay. In such cases, it becomes imperative for organisations to understand moonlighting and clearly define the opinion they hold around it in order to draft a robust moonlighting policy.

A version of this article was published on 22 December, 2022 by The Economic Times Insights.com