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Are side hustles a threat to employment?



Side hustles refer to an individual’s secondary source of income, ranging from part time jobs taken in their spare time, such as working in a pub on weekends, to starting up their own business or following a passion, perhaps as a beautician, gardener or artist.

In fact, the most common side hustle for British adults is selling unwanted clothes on sites such as Depop or Vinted, having a part-time second job comes next and social media influencing and content creation is listed in third place. 

Ordinarily, there is no requirement for an employee to declare additional earnings to an employer, whether it comes through taking on a second job or setting up a new business.

It is only when the side hustle becomes a distraction or begins to impair the quality of work being produced for the primary employer that an employee may need to be honest and open about their situation.  

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Navigating conversations around additional income can be uncomfortable for both employees and employers, particularly as many employees often turn to a second income to compensate for what they perceive as a low or unsatisfactory salary.

It’s essential that when entering conversations with staff, employers take a soft and investigative approach to find out what the side hustle is, when it is being worked on and what the reasons may be behind it.  

If an employer does find evidence that the side job either directly competes with the business or is being worked on during the contracted working day, they may choose to begin disciplinary proceedings, which could potentially lead to a dismissal.

However, employers should tread carefully, as if it is found that the employee had to implement a side hustle as a result of a low salary, it could ultimately cause reputational damage to their brand if not handled sensitively and appropriately. 

Employers should also remain aware of working time regulations which mean employees cannot exceed an average 48-hour working week.

If an employer finds out that an employee with a side hustle is looking to exceed these hours, they should ask the employee to consider signing an opt-out agreement to protect themselves from potential future claims.

If the worker does not agree to this, the employer should look to reduce their working hours to ensure compliance with the 48-hour limit.  

More often than not, employee side hustles pose no threat to an employer, but clear boundaries should be put in place to ensure the workforce is clear on what is and isn’t acceptable.

Whilst these conversations can be complicated to navigate, it’s important that employers understand that employees will often pursue passions and hobbies, and they should seek to review their pay practices and employee support offering to ensure that no one is being driven to secondary work as a result of poor pay.  

By holding open conversations around side hustles with employees and conducting thorough yet sensitive investigations where necessary, employers can be assured that any extra work taken on should have little impact on day-to-day working life.  

Nicholas Jones is employment partner at law firm Shakespeare Martineau. 

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