While employees having side jobs or engaging in freelance work is not new, some are now juggling two or more traditional 9-to-5 full-time jobs at the same time, a phenomenon known as overemployment. Employees are drawn to the practice to maximize their earnings, but overemployment can have significant drawbacks for employers.
The rise of overemployment has been facilitated by the shift to remote work during the pandemic, as individuals have found it easier to manage multiple jobs without the distractions and time constraints of commuting to an office. Advancements in technological tools have enabled remote workers to at least attempt to simultaneously meet the requirements of more than one employer.
Factors such as inflation, which has reduced the purchasing power of salaries, have also driven individuals to seek additional sources of income through multi-employment.
Whatever the reason employees choose to pursue the practice, it poses major headaches for employers — that is, if and when employers find out about it. Typically, employees are secretive about working two jobs at the same time, not wanting either of their employers to find out.
Overemployment can lead to a drop in an employee’s productivity at either or both of their jobs due to their divided attention. It can also create concerns about potential violations of company policies, such as confidentiality agreements. And an employer may feel deceived and lose trust in the employee.
What Can Employers Do?
If one or both of the employers find out an employee is overemployed, can they prohibit this practice? While laws in some states, including Colorado, protect employee outside employment during off-duty hours, if the employee is simultaneously performing work for two employers, yes, employers can address it.
Employers should look to their policies and past practice as to whether discipline is warranted and, if so, at what level. Each situation may be different, so the employer should gather facts, and this should include a conversation with the employee. Then, they should make sure any corrective action is appropriate and consistent with past practice.
The corrective action may be requiring the employee to stop the outside employment or could be terminating the employee, depending on the severity of the situation. Additionally, the employer can address any performance issue created by the outside employment, even if the outside employment is protected.
Establishing Policies
How can employers be proactive and establish guidelines to help prevent overemployment and safeguard themselves against conflicts of interest?
It is important to note that there are federal and state laws, including in Colorado, that prohibit restricting employees from pursuing lawful employment elsewhere. There are exceptions for executives, managers, officers, professionals, and certain contractually bound employees.
Employers are encouraged to establish policies that focus on promoting appropriate conduct for employees with external jobs rather than banning outside employment. Specifically, organizational guidelines should address external employment if it:
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Impedes the employee's ability to perform their duties within the organization
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Conflicts with the organization's current or future products or initiatives
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Involves conducting external business activities during working hours at the organization
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Involves the use of the organization's confidential information
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Involves working for a competitor of the organization
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Utilizes the organization's resources, equipment, or paid time off benefits
Click here to access Employers Council’s sample policies addressing outside employment.
Ultimately, it is crucial for employers to have clear guidelines in place to ensure that employees meet their performance expectations. Employers Council can assist Consulting and Enterprise members with developing such policies and others related to employee conduct. For more information, please contact us at info@employerscouncil.org.
Ruth Rusongoza is a human resources consultant for Employers Council.