Performing Other Work On Company Time? How Employers Can Protect Against Moonlighting
September 12, 2025
| By
Clifton Yiu
Employment Standards
Summary
In recent months, a Silicon-Valley software engineer has made the news after it was discovered he had been “moonlighting” simultaneously for different tech start-up companies by performing multiple full-time jobs and purportedly working up to 20 hours per day.
“Moonlighting” refers to an employee who works a second (or more) job(s) in addition to their regular employment. In most cases, employees “moonlight” by having part-time employment or self-employment outside of their regular duties, rather than multiple full-time jobs. While moonlighting in and of itself is not strictly illegal in most cases, employers are justifiably concerned about whether the employees they hire will dedicate their working time and effort to the job they were hired to perform.
In this article, we explore how an employer can manage the risk of employee moonlighting via contract and how to identify and address potential moonlighting.
Contractual Protection – Conflict of Interest and/or Exclusivity Provisions
After finding the right candidate, employers should extend an offer of employment with terms and conditions of employment to the prospective employee in the form of an employment contract or letter of employment. Employers concerned about employee moonlighting should include conflict of interest and/or exclusivity provision in the contract. These provisions provide employers with greater protection against moonlighting which operate alongside unwritten common law protections in favour of the employer (e.g. an employee’s duty of loyalty).
While the scope of conflict of interest and/or exclusivity provisions vary depending on the nature of an employer’s business, these provisions clearly outline the employer and employees’ expectations at the outset regarding when an employee will be permitted to perform work for another employer and/or themselves.
For most employers, a conflict of interest provision prohibiting an employee from working for a competing business (operated by themselves or otherwise) is often sufficient. An employee’s decision to perform part-time work in a field entirely unrelated to their full-time job will not likely adversely impact the employer’s business, so long as the employee is able to provide their full attention and energy to their employer during business hours and where the employee is not competing, directly or indirectly, with their employer.
Exclusivity provisions are more restrictive than a conflict of interest provision as they limit an employee’s ability to work for anyone else while they are still employed with their contracting employer. While imposing an exclusivity provision may require an employer to provide greater incentives for an employee to forego the right to perform other work, the security provided is often beneficial for employers in particularly competitive industries, industries where it is harder to monitor for moonlighting (e.g. purely remote-work environments), and for employees with highly specialized skillsets.
However, a non-competition provision that restricts an employee’s ability to work after their employment with their employer ends is not an appropriate method to manage moonlighting for most employees in Ontario. Under the Employment Standards Act, 2000, non-competition agreements are illegal for all but senior executive level employees. Including a non-competition provision in a contract for a middle manager employee, for example, could adversely impact the remainder of the employee’s contract, including any other conflict of interest or exclusivity provisions. Provisions to prevent moonlighting must be limited to the duration of the employee’s employment with their employer only.
Identifying Moonlighting Through Performance Management
While a contract provides clear recourse for employers if an employee is improperly moonlighting (e.g. termination of their employment), the available recourse will only be applicable when a moonlighting employee is identified.
Moonlighting can arise from employees who work physically in the workplace or remotely. However, moonlighting can often go unnoticed for long periods of time for employees who primarily work remotely, as an employee’s absence from their workstation would not be as apparent as it is for employees who work physically in the workplace.
Employers should be regularly reviewing employee behaviour and performance to assess whether employees may be moonlighting on company time, particularly for remote employees. Signs of employee moonlighting can include:
- Unsatisfactory response times to communications from other employees or management, especially in urgent situations;
- Missing deadlines and/or regularly requesting extensions for completing work without adequate justification;
- Regularly receiving communications from the employee outside of regular business hours where the work does not typically need to be done, or is not expected to be done, outside of working hours;
- Frequent unexplained absences; or
- Consistent unavailability during regular business hours.
Employers should carefully review their workforce to determine if employees are exhibiting similar behaviour to those described above as they may suggest that an employee’s attention during business hours may lie elsewhere.
However, employers should not be quick to jump to conclusions; employees may have reasonable justification for their behaviour which, in some cases, may raise additional obligations for an employer (e.g. the potential need for accommodation on human rights grounds). Employers should speak to employees exhibiting the above behaviour to assess if and how the employee’s attention to their regular work can be refocused and take reasonable action to do so. This could result in accommodations provided to an employee or taking disciplinary action, depending on the reasons for the employee’s behaviour.
Takeaways
An employee’s decision to moonlight will often have a detrimental impact on the work that their employer hired them to do. Employers must set clear expectations from the outset of the relationship to outline what an employee can and cannot do with respect to work outside of their employment. Once a moonlighting employee has been identified, employers should act quickly to determine whether the employee’s actions were inappropriate and take appropriate action. In egregious cases, an employer may be justified to terminate an employee’s employment for cause for moonlighting. This should be determined on a case-by-case basis, ideally with legal review.
Need More Information?
For more information or assistance with employment agreements and/or managing conflicts of interests, contact Clifton Yiu at cyiu@filion.on.ca or your regular lawyer at the firm.
