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Dealing with Moonlighting Employees for California Employers

MoonlightingWhether it is acting, singing, modelling, founding a startup, daytrading, or dabbling in real estate, a substantial number of employees moonlight (or more appropriately, daylight) by earning income in ways other than their employment.  Dealing with moonlight employees can be tricky for California employers because of the restrictions prohibiting employers from interfering too much with an employee’s off-duty activities.

Obviously, it is not realistic to bar employees from engaging in other activities or taking second jobs to better themselves or their families. Since the great recession of 2007 occurred, it has become very common for employees to take other work to make ends meet, or build up experience to pursue long-term goals in a different field. Problems arise, however, when the employee’s activities  are interfering with job duties, causing problems for the employer, creating conflicts of interest, or if the employee is  texting, taking calls, using the Internet, printers, and otherwise engaging in non-employment activities during the workday. Where should the right boundaries be?

Off-Duty Activities
California law makes it clear that it is unlawful for an employer to interfere with an employee’s off-duty activities.  It is not possible to forbid employees from taking other jobs or pursuing hobbies, endeavors, projects, or other efforts while they are not at the workplace.  The grey areas arise when the employee is participating in activities that interfere with the employers’ work or have  negative impact on performance.  Consider for example, the off-duty activities undertaken by a former prosecutor in the Michigan Attorney General’s office, who was an off-duty blogger making numerous anti-gay and other comments criticizing the University of Michigan’s student president.

The Rough Night
Some common complaints by employers arise when the employee’s ability to do their job effectively  suffers because the employee is too tired from nighttime (or daytime) activities.  For example, if an employee is a night-time casino worker or overnight transportation driver, who has trouble staying awake in the days because of long hours at night, the employee’s off-duty activities would be interfering with the employee’s employment.  Moonlighting can create problems for the employer due to the worker showing up late, missing work, calling in sick, or leaving early, to get to or come from another job. “It’s hard to serve two masters,” the old saying goes.

Employers’ Resources
Regardless of the employee’s off-duty activities, employees should not be using the employers’ resources, IT systems, equipment (like printers, toner, ink, etc.) to pursue their own activities. During worktime hours (excluding meal breaks, rest breaks, etc.) employees should be devoting their time primarily to the employers’ tasks and duties.

Moonlighting Policies

The best way to prevent against these problems is to effectuate a moonlighting policy. The basic policy should generally address: a) interference with the employment caused by the employers’ off-duty activities; b) conflicts of interest; c) use of the employers’ resources; and d) off-duty activities that put the employer in an unfavorable light with the public. With a little planning, employers can better position their ability to respond to such situations if they arise.

For some general guidance, please check out our Sample Moonlighting Policy.


AXIS Legal Counsel’s Business and Corporations Practice provides legal advice to numerous businesses with a variety of legal matters involving employees and labor law. We can assist in establishing compliance with California’s Employment and Wage & Hour laws, employee handbooks, leave policies, promotions, demotions, terminations, payroll matters, and other employment requirements.  AXIS offers full-service legal support to businesses and companies, and can also assist your company with business formations and governance, contracts, deals, and transactions, administration & operations, risk management / insurancelabor/employment matters, intellectual property, healthcare, crisis management, directors/officers, private/data security, technology, statutory/legal compliance, and business litigation.

For information on retaining AXIS Legal Counsel to represent your business in connection with any legal matter, contact [email protected] or call (213) 403-0130 for a confidential consultation.

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