Kim’s Message: Moonlighting & Polyworking in California

You’ve probably heard of moonlighting—but what about polyworking? This trend is gaining traction with remote workers, and it’s leaving many HR professionals and leaders (including myself) wondering what this means for their organizations. If you’re wondering what in the heck I’m talking about, let me break down the definitions and the protections you can put in place for your business.

Moonlighting

Moonlighting occurs when an employee takes a second job outside their normal work hours. For example, a receptionist might work 8 a.m.–5 p.m. at their primary job, then work a few evening shifts at a hotel.

In California, employees generally have the right to hold two or more jobs (Labor Code Section 96). However, there are exceptions to this labor code.  An employee who is moonlighting is not protected if their second job:

• Involves illegal activity
• Uses company resources or property
• Harms the employer’s goodwill or reputation
• Misuses confidential information or trade secrets
• Results in poor work performance
• Presents a conflict of interest (e.g., a current employee who competes with the company by taking side work for a customer. All employees owe a duty of loyalty to their employer.

Polyworking

Polyworking—or daylighting—goes a step further. It refers to employees working multiple jobs simultaneously, often full-time, during overlapping hours. That’s right, working two or more jobs at the same time! This is happening, and in fact, there are entire online communities that promote overemployment as a way to diversify income, build skills, and gain flexibility. Crazy, right?

Polyworking may sound good to some employees, but it creates major risks for everyone involved. Employees are likely to face stress, burnout, and declining performance, while employers risk lost productivity, inconsistent work quality, and compromised security.

Do Employees Have to Disclose a Second Job?

If you are wondering whether an employee has to tell you when they take on a second or even third job, the answer is no.

California employees are not legally required to tell you, unless you have a valid employment contract requiring disclosure or approval. As I mentioned earlier, LC 96 protects an employee’s right to engage in lawful activities outside of work.

Since California is an at-will state, unless your company has a union or is in the public sector, it’s unlikely that you have an employment contract. However, the good news is that both private and public sector employers can create Conflict of Interest Policies!

Conflict of Interest Policy

Also called an employee code of ethics, a conflict of interest policy can be incorporated into your employee handbook or used as a standalone policy document. It addresses an employee using their position with your company with third parties for private gain and/or harm to your business. Generally, these policies include language about conflicts of interest between an employee's personal or financial interests and their work-related duties, giving and receiving gifts to or from third parties, the procedure for reporting potential conflicts of interest and violations of the policy, and a non-retaliation policy for reporting violations.

Employer Risks

While neither federal nor state law prohibits multiple jobs, employers and employees should be aware of the risks:

• Conflicts of interest: Working for competitors or misusing confidential data can lead to termination and legal action.
• Fraud: Billing two employers for the same hours is illegal and can result in civil or criminal charges.
• Performance & resources: Declining performance or use of company time/equipment for another job is cause for discipline. Employers can—and should—require that employees devote their full attention to company work during work hours and, in the case of exempt employees who are not paid by the hour, to the extent required to get the work done.
• Technology risks: Overextended employees handling multiple employers’ devices and data raise compliance and IT security concerns.

Best Practices

• Acknowledge reality: Moonlighting isn’t going away. Instead of trying to eliminate it, set reasonable boundaries. Polyworking is an entirely different animal; make sure your employees understand the difference and the risks.
• Communicate openly: Encourage employees to talk about second jobs before they become a problem.
• Coordinate internally: Ensure HR, IT, and Compliance teams work together to monitor risks.
• Create a conflict of interest policy: Include this in your employee handbook, in your job offer letters, and discuss it when interviewing job candidates. Clearly outline expectations around outside employment, use of resources, and conflicts of interest.

Key Takeaway

Moonlighting and polyworking are likely here to stay, but they pose different risks. Employers should focus on setting clear policies, protecting company interests, and maintaining open communication—while respecting employees’ rights under California law.