Close form

How to Manage Employees Who Have a Side Hustle

25 November 2019
Mark Friend
Payroll, People, Building a Business

A recent study suggests that 25% of employees in the UK are running at least one business project alongside their day job: a side hustle!

A side hustle is a secondary business or job that brings in, or has potential to bring in, extra income. It’s particularly popular among millennials and generation Z (those born 1997 to 2010), who tend to start a side hustle as a hobby or to explore a new challenge.

Millennials and generation Z have different attitudes towards work and technology; they’re comfortable working from anywhere, using a smartphone or a tablet.

Various studies have shown that employees with a side hustle, report feeling happier and more content.

So why do businesses / employers seem to view a side hustle as a negative distraction from their employee’s day jobs.

With many of the best employees having a side hustle, employers need to be more supportive. A side hustle can be a good thing as long as it doesn’t involve working for a competitor or doing anything that might damage the main employer’s business.

Employees learn new and useful skills from running their own side hustle.  They gain real-life experience of customer service, project management or budgeting that can be applied when they are working their day job. From an employer’s perspective, their employees are gaining new skills that can make them better at their jobs and the employer doesn’t have to pay for any training.

Research from numerous studies has found that an employee who has the drive to work a side job is more likely to be innovative, proactive, and organised. They are also more likely to come up with new ideas, which they have gained through their own new experiences.

A survey from a well-known careers website recently revealed that over 70% of employees with a side hustle want to remain in full time employment. They don’t want their side hustle to become their full time job, as it’s more of a hobby / passion that just happens to create an income.

It seems that the side hustle is here to stay and employers need to shift their view – a side hustle is a positive thing.

With the cost of living on the rise and average salaries in the UK barely keeping in step with inflation, increasing numbers of UK employees (not just millennials and generation Z ) are turning to second and third jobs to maintain their lifestyle, or simply to make ends meet. This may not appear to be a major issue for employers, providing their attendance at and quality of work is not adversely affected by time spent on other jobs. But what happens if it does?

AHR Consultants our HR Business Support partners suggest these safeguards.

First employers must ensure that they are protected from potential conflicts of interest and competition if any of their employees start moonlighting for a competitor. Employers should have express contractual terms:

  1. Prohibiting employees from working with/for any other business that might be in competition with the employer.
  2. To ensure that employees first seek and receive approval from the employer before taking up any additional employment.
  3. Stating that the employee spends all their time at work in pursuit of the employer’s business and not working on personal or other business endeavours.
  4. Confirming that the use of the employer’s facilities and equipment should only be for the exclusive benefit of the employer’s business and not for any personal or other business activities.

The European Working Time Directive and UK Working Time Regulations puts a limit on the total number of working hours an individual should be expected to work per week, 48 hours, which applies across all jobs.

This puts an obligation on the employer, in the absence of an opt out of the 48 hour agreement, to monitor the employee’s working hours not just for them, but across any/all work the employee may be undertaking for themselves or any other employer.

Where employees are engaged on driving duties, either for their main employers or any secondary business, the Driving Hours Regulations are even more restrictive in terms of the number of hours of driving permitted and the duration and frequency of rest breaks, so it is essential that employers are aware and ensure full compliance with the law in this regard.

Health & safety obligations govern the employer’s and employee’s responsibility to ensure their fitness for work at all times. Working on personal and other business endeavours may negatively impact the employee’s rest periods and result in increased fatigue that may influence the employee’s fitness to work and to work safely and productively for the employer.

If any employee becomes distracted by their outside business interests, this should be addressed informally by the line manager in the first instance and the rules and expectations regarding their commitment to the employer’s business be highlighted. If their conduct continues to pose a risk to the employer’s business, or their attendance and quality of work deteriorates then formal action under the Employer’s Code of Conduct, disciplinary and dismissal procedure or performance and capability procedure should be considered.

Overall the benefits of side hustles and second jobs can be great for a business provided employers safeguard themselves in case the employee doesn’t play by the rules. Our HR Business Support partners, AHR Consultants can be contacted on 0345 076 2288

The content in this blog is correct as at 25/11/2019. See terms and conditions.

Similar articles

21 October 2020

Support for businesses placed into lockdown

The Local Restrictions Support Grant will apply if your business is placed into lockdown, but there may also be some discretionary grants available from your local council.

Joint hands at wooden desk
19 October 2020

What is the Job Support Scheme?

With the Job Retention Scheme set to finish by the end of October, what support is there for employers?

Man at desk
6 October 2020

The pitfalls of engaging consultants and contractors

There are important changes being introduced in April 2021 to combat companies employing individuals through their own personal services companies. In our blog we highlight the dangers to business owners and how over the years the rules have changed and the net tightened leading to the new off payroll rules which come in to play on 6th April 2021.

Our 3 step risk-free guarantee puts your mind at rest and keeps us on our toes!

FIND OUT MORE
Bryant House - Friend and Grant Chartered Acocuntants and Tax Advisors

Book Your Discovery Meeting

Are you hungry for success? If you run a small to medium size business and you want to grow your sales, increase profitability and pay less tax then you have come to the right place.