Indian IT Firms Are Changing Contracts, Employment Rules To Stop Moonlighting

If you are the one who follows corporates and their culture, then you might be aware that these days, it is the “moonlighting” that is at the epicentre.

Indian IT Firms Are Changing Contracts, Employment Rules To Stop Moonlighting

The proliferation as well as its acknowledgement is now pushing companies, led by IT/ITeS and technology players, to seek legal help to re-evaluate and redraft existing employment contracts.

Companies Reaching Out to Law Firms

Law firms which include Khaitan & Co, AZB & Partners, A&P Partners and Sarvaank Associates said that they have seen many companies reaching out to them for help in redrafting employment agreements, figuring out loopholes, making contracts more robust, enforcing restrictions, or even enabling moonlighting with necessary checks and balances.

As per Anshul Prakash, partner, employment labour & benefits at Khaitan & Co “Several organisations in the IT/ITeS sector have been emphasising the requirement to have their employment contracts and policies revisited, including additional clarity on their stance against possible moonlighting. The moot point is to specify that exclusivity of employment relationship and confidentiality obligations would not be limited to work hours but for the entire service tenure. Any actions that conflict with such obligations would warrant disciplinary action against that employee”.

Priyanka Sinha, cofounder of law firm A&P Partners said that “There is a culture shift about taking up side gigs. Companies are aware that they can’t stop people beyond a point. Hence, they are trying to ringfence their businesses by putting processes in place”.

Corporates are reaching out to them to design policies can be designed to ensure that employees treat their employment as the primary job, outline what amounts to conflict of interest and set out restrictive covenants from taking jobs with competitors during employment and ways to protect themselves in terms of confidentiality.

Wipro Fired 300 for Working Secretly With Competitors

The corporate India is split when it comes to this phenomenon. As per Wipro chairman Rishad Premji who has been a vocal critic, recently said the company had fired 300 employees who were found to have been working secretly for competitors.

A consultant, who did not wish to be named, told ET that the potential challenges around moonlighting will create the need for companies to ensure contracts are more watertight and clear boundaries laid down. “This is a classical friction as employee expectations and technology moves faster than regulation,” he said.

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