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Caution: A complete ban on moonlighting could be unenforceable

There are a number of good reasons why companies may wish to restrict their employees from working second jobs. Moonlighting can be tiring, and some employees may become less productive as a result. In particular industries, a fatigued worker can be a safety risk.

In other cases, employees may take second jobs that create a conflict of interest with the first company. An employee might go to work for a direct competitor. Or, they may take a job with a vendor or supplier and be in a position to influence contracting.

It may be tempting to ban moonlighting altogether but, in reality, some employees simply may need to moonlight to make ends meet. A lot of employees consider moonlighting bans to unduly restrict their free time and economic opportunities. Employers may benefit from a less restrictive policy.

There is another reason why a full ban on moonlighting may not be the best policy. It might be unenforceable, according to a recent ruling by an administrative law judge with the National Labor Relations Board (NLRB).

In that case, a company called Nicholson Terminal & Dock Co. had a policy prohibiting moonlighting that 1) was inconsistent with the company's interests, 2) had a negative impact on the company's image, or 3) required so much time and effort as to interfere with the employee's work. Further, employees had to obtain prior approval from the company treasurer before taking a second job.

The company said these restrictions were primarily about workplace safety and keeping employees from working for competitors. The judge, however, found that the first and second restrictions in the company's policy were in violation of the National Labor Relations Act (NLRA), which guarantees employees the right to unionize and bargain collectively.

Suppose a worker wanted a second job attempting to organize Nicholson's workers into a union. Under Nicholson's policy, this might be seen as adverse to the company's interest or likely to negatively impact its image.

In fact, many employers have argued that unionizing activities go against their interests or promote negative publicity, but the NLRB has found that workers' collective action rights outweigh such concerns.

Any moonlighting ban should be narrowly tailored

Employers do have the right to restrict moonlighting in many circumstances, but a complete ban probably isn't enforceable because it could be used to restrict employees' collective action rights.

Legally compliant policies are generally narrow in scope, prohibiting outside work only when it interferes with the employee's first job or when it creates a conflict of interest.

If you think you have been improperly prohibited from moonlighting, we recommend discussing your concerns with an employment law attorney.

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