With the increase of remote work and tech jobs in Texas, moonlighting appears to be on the rise. This naturally leads to the question: can my employer fire me for moonlighting? There is no simple bright line rule. Instead, it requires knowing what your company’s rules are and knowing what agreements you have signed.
This past week I had a consultation that brought up an interesting question. The consult wanted to know what laws protected him from getting another job while still employed with his current employer. To quote them, they wanted to know if they could get in trouble for having a “side hustle” or secondary income stream. The practice of having a side hustle is becoming more and more common. In particular, it is big in the tech industry where many employees either freelance or operate a completely different small company. Having a second job is often referred to as moonlighting, and the question of whether it is legal requires a rather longwinded answer that almost always falls into the purview of what your employer’s workplace policies state. In this blog I would like to flesh out that answer.
First, with the exception of serving in the military, there is no specific law that outlines whether someone can hold a second job. This means that instead of looking at statutes, we turn to either contract law or the employer’s internal policy to find the answer.
Under contract law the obvious answer is a non-competition clause or sometimes duty of loyalty clause that limits the employee’s ability to seek secondary employment. While the answer to what a non-compete is can be a full blog answer, in short it is essentially an agreement between an employee and an employer where the employee agrees to not compete during the term of their employment and sometimes for a period of time after their tenure with the employer is done. Under the Texas Business Code, these agreements are fully enforceable provided that they are reasonable in scope, geographic area, and time. Thus, if an employee has signed a non-compete agreement and their second job competes with their primary employer, then they may very well be in violation of that agreement.
If an employee was to violate a non-compete with their moonlighting, the employer may be entitled to seek an injunction from a court to stop the employee from continuing to breach the agreement. Further, if the employer is able to prove that it has suffered an economic harm from the employee’s engagement in the second job, it may choose to seek damages from the employee. As such, it is imperative to take note when joining a company if you will be forced to sign a non-compete agreement.
Next, as stated above, there are no specific laws that state that you cannot have a second job. Nonetheless, this should not be taken to mean that an employer cannot fire you for working a second job. This is because employers typically have specific company rules that forbid moonlighting. Moreover, even if you are not subject to a non-compete, sometimes employers have internal conflict of interest rules. This means that absent some discriminatory application of this rule, an employer may terminate an employee for having a conflict of interest i.e. a second job.
Lastly, due to the fact that Texas is an employment at-will state, an employer is still able to discharge an employee for any reason, even if false, so long as it does not run afoul of another law. Thus, even if there is no rule against a second a job, an employer may still choose to terminate an employee for moonlighting. Again, this is assuming it is not for an illegal reason.
Ultimately, when it comes to moonlighting it is always best practices to request a meeting with your employer to discuss if whether your engagement with another employer would be acceptable. The old adage “it is better to ask for forgiveness than permission,” is inapplicable here. But, as was alluded to above, the mere fact that Texas is at-will or that there are internal policies not allowing moonlighting does not always mean that it is legal. Often times these inquiries require a holistic analysis by an attorney that understands the law and is willing to fight for your rights. At Wiley Walsh, P.C. we specialize in employment, and we are more than happy to go over your situation so that we can assess what we are able to do for you. Feel free to contact us to schedule an appointment with one of our attorneys.