30

So I've been working at my current employer for almost 4½ years. A while ago I was approached by a manager from my previous employer asking me if I would be willing to assist them with some projects as an external consultant. It turns out they don't have the required knowledge in-house and since I had already worked on those projects when I was employed with them, they turned to me.

Since they would require me to do things I already do for my current employer, I agreed. We still have to agree on the details, like payment and exact expectations, but I've already made it clear I would only be able to help them outside my regular working hours and my main job would always get priority over them.

I'm now wondering if it would hurt or rather help me if I were to mention this to my employer. I don't think I have anything to lose by telling them as my contract doesn't mention disallowing anything like this (as long as I don't use their resources or things I developed for them of course).

I think that mentioning this might let them know other companies are looking for people with my profile, which might reinforce my position in the company (improving chances of raises or promotions). I am certainly not someone who couldn't easily be replaced, but still.

Finally I want to clarify that I am still very happy in my current job and am not looking at leaving them to become a full time consultant, nor do I have any intention of going back to my previous employer. I would only do it for the experience and to earn a little extra on the side (increased taxes and stuff taken into account). I would also make this very clear to my boss if I told him about it.

EDIT: ALready some great answers, but I feel like I need to clarify some things:

  • My contract, company policy and the law all permit me to do something like this, I have checked this before I even talked with my previous employer.
  • I am not, and certainly will not be planning to leave my current employer to go back to my previous employer or to become a full time freelancer. Working with them is still very fulfilling and I have zero complaints. I would also make this very clear when approaching my manager.
  • If I were to tell my manager, I wouldn't do it with the intention to gain anything, it would mainly be because I don't want to do it behind their back.
  • Even though I would be doing the same type of work, my previous and current employer are in completely different fields, so I wouldn't be working for a competitor. The work relates to a specific branch of IT which is used in a lot of big companies.
11
  • 8
    Dont forget to take into consideration employment law. In my country you are not allowed to work more than 45 hours a week - that includes both jobs. May 6, 2022 at 9:00
  • 4
    In some jurisdictions, even if the law allows you doing side gigs, the law may require you to notify your employer (because your employer might be required to file taxes related to you differently then).
    – orithena
    May 6, 2022 at 13:31
  • 2
    @stackoverblown its not any of the employers business, but if the employer finds out not from the OP, it could hold negative repercussions. This is a valid and useful questions as a result, somewhat of a damned if you do, damned if you don't situation. Most people choose not to moonlight because of this perceived risk.
    – GOATNine
    May 6, 2022 at 17:05
  • 2
    @JoshPart see my answer. You'll find that different industries treat freelancing very differently. This is why I use the word may instead of will. Depending on jurisdiction, repercussions could include termination and blacklisting, though if there's no anti-moonlighting clause this is unlikely. At the very least the employer may view it as a sign the employee is looking to leave and act accordingly (prepare to replace, hire over, remove from consideration for raises/promotions)
    – GOATNine
    May 6, 2022 at 18:00
  • 1
    @stackoverblown It's pretty common for a salaried employee to be expected (and required) to give as much of their focus and energy to their employer as possible, especially if you work for a Fortune 500 company with a huge salary. The idea is that you're "giving your all" in return for a lot of compensation. As an example, many companies automatically own an IP you come up with while employed by them (i.e. you can't go file a patent in your spare time). At Microsoft all paid work outside our job required approval. It was usually freely given though.
    – pbarranis
    May 8, 2022 at 10:07

10 Answers 10

47

Depending on the industry and your employment contract (if any) this can end very badly for you.

Your current employer may look poorly on you doing the exact same type of work for another company, as you are effectively working for a competitor by doing so. While you may not use company resources from your current employer, how do you quantify intangible assets developed by the company (such as if they train you or have a process methodology that gives them an advantage, which you would use for your freelance work).

Additionally, while a weaker argument, your current employer may assume that any freelance work you do in the same field will reduce your willingness/effectiveness as you work for them. I know in Controls Engineering and Programming, I'm only good for X hours a day before I need to step back and do something different, to let my mind recharge. If you're doing freelance work on top of your regularly scheduled work, you may be reducing your overall ability to perform (which would be a concern for the company you work for).

If you plan on freelancing, I would only mention it to your current employer if you are required to. I would also be prepared for negative backlash if my employer found out I was freelancing in the same industry.

4
  • 13
    As the OP feels they have covered most of the objections, the important one that stands out to me is the 3rd paragraph about effectiveness. We have many other answers that quote a ~40 hours effective maximum productivity for knowledge workers (and the "thinking time" part of that is less, maybe 25-30 hours). IMO, the OP risks dropping in performance for their main employer, or burning out attempting to run both gigs. If the side hustle was something entirely different - coaching a sports team, working in a bar, arts/crafts etc, then it may be more feasible. May 6, 2022 at 7:01
  • 1
    @NeilSlater it's more about perception form the current employer than reality anyway. so long as the perception of a performance drops exists, its a potential problem
    – GOATNine
    May 6, 2022 at 13:24
  • Just because he is doing similar work for 2 companies, it does not mean the companies are competitors. You could be writing very similar code for companies that are in completely different fields. A Database is used by McDonalds and GM, but they don't compete with each other in any way.
    – boatcoder
    May 8, 2022 at 12:16
  • @boatcoder Again, it's about how the employer perceives the relationship. I can tell you I've done work for several companies in the same field and the same business who were not competitors due to geographic differences. The vast majority did not mind one bit (again, not competitors), but a few DID take exception. This answer is written to be broad enough to cover what CAN happen, not just answer the specific question.
    – GOATNine
    May 8, 2022 at 12:23
30

I don't think I have anything to lose by telling them as my contract doesn't mention disallowing anything like this

Make 100% sure your current employer's contract doesn't prohibit "moonlighting" of any kind.

What you do outside of your employers hours is none of their business.

Letting them know you are moonlighting can only hurt you.

I think that mentioning this might let them know other companies are looking for people with my profile, which might reinforce my position in the company

The only real thing that employers fear is losing a valuable team member at a critical time.

The only time-proven way to create this fear is having an outside offer in hand and be willing to take the outside offer.

If you're going to threaten to leave (and this is the only way your management will interpret your side hustle), you have to be willing to go all the way.

Don't try to play head games with your boss, it's just not worth the risks.

The strongest option here is just to do the side work quietly and treat it as a networking option in case things go south with your current job.

2
  • 4
    100% agree, first thing check your contract if you have any and validate that you can work for someone else on your own time. Besides that, Its not your employer business what you do outside of work hours
    – Strader
    May 5, 2022 at 14:31
  • 2
    Also make sure that the contract does not have restrictive IP or non-compete clauses that might affect ownership of the outside work you do..as a consultant, I’ve seen some really, really horribly restrictive ones. May 5, 2022 at 21:52
17

You have very little to gain by telling your current employer, unless you work in an industry where such extra work is legally mandated to be shared. For instance, if you work as a government regulator and also at one of the people you're supposed to be regulating, then you have to disclose it. But barring such a situation, your current employer doesn't need to know about anything that you do outside of their work hours.

Chances are likely that your current employer won't want you taking on the extra work. They would be worried you might jump ship, that you'll work on it during their official work hours, or that by having a second stream of income you view your current job as disposable.

At the same time, the upsides you mention in your question don't really exist. If you tell them you're in high demand and working with another company, I strongly doubt that would help your standing in your current company. If I had an employee telling me that they're doing extra work in their free time, I wouldn't think I should promote them, I would think I should hold them back because they're not loyal to my company.

11

Don’t forget about intellectual property law

In the U.S. it is not uncommon for IT sector companies to make their employees sign agreements stating that the company owns all intellectual property developed by the employee while employed by the company, possibly with some limitations, but not always. Even if you didn’t sign such an agreement, either explicitly (a separate contract), or implicitly (it’s buried in an employee handbook that you agreed in writing to follow), you may be risking being sued for intellectual property theft by your current employer, which doesn’t sound unlikely since you’re doing work for a potential competitor that is very much like what you’re doing now. This all assumes that you’re generating creative works (software, designs, specs, etc.). IANAL but I’d check everything you signed directly or implicitly, check relevant workplace policies, and possibly talk to a lawyer first if you’re serious about going this route and are doing work where you’re creating things. You could be exposing yourself to a lawsuit at the hands of your current company (again IANAL). Personally I’d be concerned about making my company mad as well and so would never do this, but if you are willing to take that risk, it may not be the only risk you face…

1
  • 2
    I don't know if it would qualify as theft of intellectual property from your employer, but I can see it giving your employer a claim of ownership over your client's product. Which is probably an even bigger legal mess.
    – aleppke
    May 6, 2022 at 21:50
9

I had a situation like this, where I worked for J and left them to work for K. While happily at K, I got a call from J, "Could you come back and do a bit more on that stuff you were doing when you left?"

Immediately I told my boss at K about this, and he said, "You can do it only if we, not you, get to bill J for your work. It will simply be part of your work for us."

So I did that, and sure enough, it did impact the work I was supposed to be doing for K, but it was soon over and I picked up K's work as originally intended. No hard feelings in any direction, nor fear of discovery.

1
  • This is the correct answer and should be flagged as such.
    – RedSonja
    May 10, 2022 at 13:14
4

Sometimes, doing freelance work outside your work may violate your contract of work with your employer.

For example, if you are taking on clients that otherwise might have gone to your employer then you are effectively competing against your employer for clients and this is very commonly prohibited in work contracts.

I'd very carefully consider this, because even in many circumstances where you may not consider yourself to be in competition with your employer, you may effectively still be, and even if the amount of work you do or the amount you're paid is very low it could be still at issue.

Still, sometimes there are situations where you can be confident you are not violating your work contract or competing with your employer, in which case, by all means go ahead and do so. For example if you are employed as a web developer but you do a bit of work as a musician on the side, or a plumber.

Whether you share details is up to you. I'd recommend caution, but if you are concerned enough about whether or not you should be sharing, then maybe it's because you fear you are skirting the line of what they would allow and maybe the answer is it's safer not to do it at all than to do it and not talk about it.

Another way to look at this, however, is if you are totally open and transparent about what you're doing in your freelance work then you can be sure that your employer is fine with it on a case by case value. This really depends on the sort of relationship you have with your employer, but let's say they have some client they have turned down, maybe you want to take them on privately and they may be fine with that, etc, which you wouldn't know if you weren't talking to them regularly about this stuff.

Finally, there are some lines of work where you are beholden to the public interest, in which it isn't appropriate to conduct any business outside your normal employment. For example, in some countries if you are a member of the police force you are barred from having any second form of employment or business due to potential for conflict of interest. If you work in such a job then you presumably would know about this already. This would also apply to jobs in intelligence and some other forms of public service too where there is the concern you may be working counter-intelligence and the like.

3

I think that mentioning this might let them know other companies are looking for people with my profile, which might reinforce my position in the company

If you don't think management will see it negatively that you're working on something else, the only thing I'd worry about is how to tell them. I feel like any attempt you'd make that involves going up to management and filling them in will sound like a passive "watch your backs or i might be gone", mostly because you already have a foot out of the door so to speak.

However if you brought it up naturally as part of conversation, eg.

"Any plans tonight?"

"Oh, just gonna do some freelancing for X"

it's a completely different situation than just approaching them while still carrying the positive effect (if there are any at all) of sharing that information with them. It will seem more like you can't get enough of what you're working with rather than looking for a way out. Who knows, maybe this can buy you some overtime at the current company ;)

But this is mostly based on the fact of how confident you sound your management won't mind the fact that you're working your job for a competitor. Else the other answers are definitely more applicable and you should probably just look for other avenues to increase your perceived worth at the company. Either way, don't walk up to them and bring it up, if you have to tell them/want to risk telling them wait for a very very good moment to do so.

2

Look into your country's laws. In some countries you aren't allowed to work on a second job within the same industry without both of them saying it's ok.

  • If you're a developer in your day job you aren't allowed to be a developer on the side without the blessing from your day job.
  • You are allowed to work in a store as an extra job if your day job is a developer, no permission or information have to be given.

Ask the union about applicable laws, agreements etc regarding this before you do any work on the side.

2

Other answers have already focussed on the contract side. On that, I'll note that I've personally had to have a contract changed for that - the original contract said "we own everything you invent", but I did open-source work and hobbyist electronics in my spare time, so the company was happy to change it to "we own everything you invent related to automotive electronics". It wasn't a problem for them, but it needed to be allowed for.

The other problem you face though, which no-one else has mentioned yet, is taxes. How are you getting paid by the other company, and how are you then paying tax on what you earn? Typically this results in the second company automatically deducting maximum-rate tax (at least in the UK), which is normally more than you actually owe. Don't forget to allow for this in the calculation of what you're actually earning. You may also need to fill in extra tax return forms, and/or hire an accountant to figure that out.

And a third issue is insurance. In the UK, freelancers normally need public liability insurance in case they do something which goes badly wrong and they get sued. It's easy enough to get and it doesn't cost that much, but you do need to factor it into the cost of freelancing.

1
  • If OP is proposing doing freelance consulting work, then most likely they won't be on payroll so there won't be deduction of tax at source. Rather, OP will invoice their customer and be responsible for their own taxes. This will mean filing a self assessment tax return each year. Also note that "need public liability insurance" isn't strictly accurate: for most industries it is not compulsory albeit it is recommended especially if you are a sole trader. Another sensible step would be to do the consulting work through a Ltd company to avoid personal operational liability. May 7, 2022 at 20:07
-1

Unless you are compensated for what you do outside of work hours, this is none of the company business.

If there are laws requiring you to do so, your contract says so, or the work is for a competitor, then you should.

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .