IT Minister Supports Moonlighting Among IT Employees; But Contract & Trust Shouldn’t Be Broken

Amidst the circus surrounding moonlighting with every IT CEO in the country chipping in, minister of state for IT Rajeev Chandrasekhar has laid his cards on the table.

IT Minister Supports Moonlighting Among IT Employees; But Contract & Trust Shouldn't Be Broken

One exemption

He has shared his support and approval for the practice, saying companies should not put a lid on employees’ dreams.

They should rather accept the employee-entrepreneur mindset of today’s tech force.

He did note that moonlighting should not violate any contractual obligations.

He clarified “However, I do agree with one part of the moonlighting argument that if one is a contracted employee of a company, and your contract says, non- compete, confidentiality clauses, then if you violate that you’re obviously running afoul of the contract law.”

New-age practices

Chandrasekhar said the days when employees signed up with big tech majors and remained there lifelong are long gone.

Per his words, “Today’s youngsters have every sense of confidence and purpose about wanting to monetise, create more values out of his or her own skills. 

So, the efforts of companies that want to pin their employees down and say that you should not work on your own startup or consulting are doomed to fail exercise.”

Poignant words to beware

He believes this is the age of employee-entrepreneurs and corporates and companies must understand and adapt to the structural shift in the minds and attitudes of the young Indian tech workforce.

To be precise, “There is a shift in our workforce, there is a shift in the psychology, temperament, confidence of young Indians, and companies and entrepreneurs who recognise this will succeed.”

He warned that any captive models will “fade”.

Employers expect employees to be entrepreneurial while serving them. 

The same people can apply it personally to themselves.”

“A time will come where there will be a community of product builders who will divide their time on multiple projects.”

He compared such people to lawyers or consultants who divide their time between work. 

And he called such an approach “the future of work.”

Wipro set the ball rolling

The discussion heated up when earlier this week, Wipro chairman Rishad Premji said the company has no place for any employee who chooses to work directly with rivals while being on Wipro payrolls.

It went on to fire 300 people suspected of doing so.

Infosys

Infosys shared the stance, warning that double employment was not permitted in the company.

It “strictly discourages dual employment”, and it defined moonlighting as a practice of working on a second job during or outside of regular business hours.

IBM India

IBM India, not to be left behind, also called it out as an unethical practice.

“All of our workers when they are employed, they sign an agreement which says that they are going to be working full-time for IBM. So moonlighting is not ethically right for them to get into,” said Sandip Patel, managing director, IBM India.

Main concerns these IT companies hold are that moonlighting will affect productivity, lead to conflicts of interest and possible data breaches.

The outliers

However, a couple stood out from the crowd.

CP Gurnani, CEO, Tech Mahindra, had tweeted recently that it is necessary to keep changing with the times and said, “I welcome disruption in the ways we work.”

Swiggy formulated its employee-first ‘Moonlighting Policy’ which allows its employees to pick up gigs or projects beyond work that add to their professional and mental well-being.

This is subject to approvals.

What does the law say?

Moonlighting in all forms is clearly prohibited in most employment contracts present today as well as laws.

Certain statutory provisions provide for exclusive service and impose restrictions on double employment such as the Delhi Shops and Establishments Act, 1954, the Factories Act, 1948, and the Industrial Employment (Standing Orders) Central Rules, 1946.

Restrictive covenants in employment contracts which are intended to apply during employment are also enforceable under the Indian laws.

Hence, the contractual provisions against moonlighting will be enforceable by employers against a defaulting employee.

Icons did the same to succeed, so what now?

Take Steve Jobs for example, who after having a dispute with John Scully, created a competing company called Next by poaching Apple employees. “There goes non-solicit, IP and non-compete clauses of today.”

It should be noted that most successful startup founders did side hustle and their unicorns were born while they were employed in large firms.

The Ambanis, Musks and Adanis create new companies every now and then and successfully run those companies in parallel and are seen as visionaries.

Are their attention divided?

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