Nichola Constant, director of People + Culture Strategies, which specialises in people management and workplace law, says Eric Simons’ story is the exception rather than the norm.
“Most cases involving moonlighting don’t have fairytale endings,” Constant says.
“An employee can risk losing their job or even paying damages if they fail to disclose business interests outside of their employment.”
“One difference between the AOL squatter case and the majority of moonlighting cases is that the squatter wasn’t an AOL employee, so there were lesser legal obligations on the squatter’s part.”
Constant points to the case of Ping Han, a former NSW RailCorp clerk, who was sacked for operating multiple companies on his employer’s watch.
Han used work hours to operate a myriad of small businesses including an insulation business, a travel agency, an interpreting service and a migration agency, in addition to overseeing several rental properties.
After working for RailCorp for 14 years, Han lost his job when his employer realised the extent of his moonlighting.
Han lost his appeal to the Transport Appeals Board for using his employer’s time and resources to run his stable of small businesses.
A RailCorp investigation found Han breached the company’s code of conduct by failing to declare secondary employment, and using his work email and other company resources to pursue his own interests.
When asked whether it’s illegal, Constant says it depends on the circumstances of the case and the particular terms of the employment contract.
“Some employers have policies or contracts that strictly prohibit employees from moonlighting,” she says.
“Generally, the more senior the employee, the higher the risk of actual conflicts of interest and legal consequences, such as termination of employment, and loss of intellectual property and profit.”
Australian entrepreneur Matthew Beeche is a former employee of Pitney Bowes, where he worked for five years.
“It was not until my fourth year there did I start to get the itch to leave and start my own business,” Beeche says.
“I started writing a small blog firstly, interviewing people from our own company about business.”
“I then dabbled in online stuff, and went and did courses to implement new online strategies within Pitney Bowes and my own business.”
Beech believes moonlighting – if done effectively – enables entrepreneurs to “fine-tune your time management skills to a tee”.
“I had a commitment to the business and my own team that I would not let my ‘other job’ affect my work negatively,” he says.
“When the business started to grow, I would use annual leave days once a month to do tasks related to B2B.”
Constant says before making the decision to “moonlight”, entrepreneurs must first consider whether it is likely to result in “role enrichment” or “role conflict”.
Role enrichment, according to Constant, is where you gain skills and knowledge that would complement your main job, whereas role conflict is where pursuing an outside interest results in stress or even outright competition.
“Many companies have a strict policy forbidding employees from moonlighting, although a growing number of employers are now willing to be more flexible,” she says.
“Employees should disclose their business interest to the employer and try to negotiate an acceptable number of hours, the type of work that can and cannot be done, and the employer’s expectations about disclosure, and ownership of work products such as IP.”
Beeche agrees employees need to be honest about their intentions, insisting “transparency is freedom”.
“If your boss does not go for it, then you have a decision to make – eventually you need to cut off the paycheck to grow the business,” he says.
