Recently, the tech giant Wipro and some other Information Technology firms such as Happiest Minds Technologies topped the news headlines for firing their employees who were allegedly engaged in the act of Moonlighting while being on company payrolls. This piece of writing will discuss the legal status of moonlighting in India, laws related to it, judicial pronouncements, and way forward to mitigate potential threats. First of all, it is important to understand the concept of moonlighting.
Introduction to Moonlighting
Working a second job alongside or in addition to being employed at a regular job is known as moonlighting. In recent years, it has become more prevalent as people look for methods to supplement their sources of income or follow their passions. This can apply to any sector of work, including self-employment, contract labor, and part-time employment.
People frequently start working a second job to boost their income or obtain experience in a different industry. Moonlighting has gained popularity as the gig economy continues to grow up. In addition to their regular jobs, many people today work as independent contractors or freelancers. Moonlighting, nevertheless, may potentially have legal repercussions, particularly in India.
Understanding Moonlighting in India
Moonlighting is not specifically defined or regulated by law in India. Legal action may be taken because this is regarded as a breach of trust. According to Indian labor rules, workers must put in a set number of hours each day, typically eight. Any additional effort is deemed overtime and must be paid as such.
However, taking on an additional job after regular working hours might make an employee fatigued and less productive, which can impair their primary work. Additionally, many industries have a policy prohibiting moonlighting that workers must adhere with. There may be disciplinary consequences for breaking this policy, which involves termination of employment.
Employers may view and approach moonlighting differently. For example, Swiggy’s moonlighting policy stipulates that the employer’s approval is needed if the extra job involves professional expertise and is highly sensitive. If the worker is following a hobby or interest, situation might be a little different.
Employees of the central government are expressly prohibited from engaging in certain activities, but they are permitted to perform honorary social or charitable work, sporadic work of a literary, artistic, or scientific nature, or take part in amateur sports without the government’s prior permission. However, the government has the right to request that the employee to stop these actions at any point of time.
Legal Position of Moonlighting in India
As previously stated, there is no explicit law in India that addresses moonlighting. But it might be subject to legal repercussions under many statutes, including the Employment Contract Act, the Shops and Establishments Act, and the Industrial Disputes Act. The Industrial Employment (Standing Orders) Act, 1946 permits dual employment. Whereas under the Factories Act, 1948, dual employment is prohibited. In accordance to the Factories Act of 1948, an employer cannot require or let an adult employee to work in the factory on days when they have already worked in another workplace. The prohibition provided by the Occupational Safety, Health and Working Conditions (OSH) Code is restricted to simultaneous employment in a mine or factory and is largely equivalent to the one outlined in the Factories Act.
A worker may not work against the interests of the industrial establishment or accept any additional employment that could be detrimental to the interests of their employer, according to the Industrial Employment (Standing Orders) Rules, 1946, which prescribe additional items that are applicable to all industries.
If an employee moonlights without permission, the employer may fire them for breach of trust under the Employment Contract Act. Similar to this, the Shops and establishment Act forbids employees from working concurrently in more than one institution, for example moonlighting.
If a worker appears to be moonlighting, it may be considered misbehavior and result in disciplinary action under the Industrial Disputes Act. The nature of the second work and how it affects the primary job, however, determines the magnitude of the disciplinary action.
Moonlighting may also be connected to other problems including a conflict of interest, disclosure of sensitive or proprietary information, rivalry, the solicitation of co-workers or vendors, the compromise of intellectual property, and attrition.
Judgements of Court regarding Moonlighting in India
Many cases involving moonlighting have been heard in Indian courts over the years. The majority of the time, the courts have affirmed the employer’s authority to fire a worker for breach of trust.
For instance, the Supreme Court ruled in Jitendra Nath Biswas v. Steel Authority of India Ltd that an employee must have the employer’s permission to work a second job. The court further held that a second job can be considered misbehavior and result in disciplinary action if it hinders with the primary work.
Similar to this, the Supreme Court ruled in State of Punjab v. Ram Lubhaya Bagga that it is misbehavior and subject to disciplinary action if an employee does a second job that conflicts with their primary position.
These problems put industries at more risk, so the proper procedure needs to be in place to safeguard company interests. Regarding the veracity of these worries, Indian courts have acknowledged non-compete restrictions throughout the employment stipulation time. Additionally, Indian law protects an employer’s intellectual property and information confidentiality. To the degree that they are reasonable, non-solicitation agreements are enforceable.
Companies must specify which employee activities they intend to approve during non-working hours. The employment contract should specify if the position of employee is exclusive. Businesses should also think about implementing strong employment contracts and human resources regulations that spell out the conditions of employment, including the duties and constraints that apply to employees as well as what would be considered “misconduct” and warrant for disciplinary action.
Additionally, if an employee’s contract contains non-compete provisions and exclusive employment, as is the scenario with the great majority of conventional employment contracts, moonlighting may be regarded as unethical. Employees may not regard it as a violation of confidence or trust if employment contracts fail to include this clause or give exceptions.