Moonlighting — the practice of an employee taking secondary employment or running a business without their employer’s knowledge or consent — creates a specific set of concerns for employers. At its most straightforward, it involves an employee working additional hours for another employer without disclosing that they are doing so. At its most serious, it involves an employee who is on sick leave from their primary employer working full-time elsewhere, or an employee using their employer’s time, resources, or confidential information to build a competing business.
The investigation of moonlighting employees is a regular part of our work, and the circumstances in which it is instructed vary considerably. Some cases are straightforward: an employer has reason to believe an employee is working elsewhere in violation of an express contractual restriction. Others are more complex: a concern that an employee is conducting a competing business, diverting clients, or misusing confidential information that has come to light in the course of a sickness investigation or an absence pattern review.
What Is Moonlighting?
Moonlighting, in the employment context, refers to an employee taking on secondary paid work — with another employer, through self-employment, or through a business interest — in addition to their primary employment. It is not inherently unlawful; many employees lawfully hold second jobs or run small businesses outside their primary working hours.
Moonlighting becomes a conduct issue where it breaches an express contractual restriction on secondary employment, where the secondary employment creates a conflict of interest with the employer’s business, where it involves the use of the employer’s time or resources, where it involves a direct competitor, where it involves misuse of confidential information, or where the employee is on sick leave from their primary employer and claims to be unable to work.
Why Employers Investigate
Sick leave fraud: the most common context in which moonlighting investigations are instructed. An employee who is absent from work on full or partial sick pay and who is simultaneously employed elsewhere or running their own business is committing a fraud against their employer. The investigation establishes whether the secondary employment exists and whether it was active during the absence period.
Breach of contract: many employment contracts contain express restrictions on secondary employment, either requiring prior disclosure and consent, prohibiting work for competitors, or restricting outside employment to specified categories. Where an employee has breached these restrictions, the investigation establishes the nature and extent of the breach.
Conflict of interest: an employee who is working for a competitor, diverting clients, or building a business in the employer’s market has a conflict of interest that may breach both their contractual obligations and their implied fiduciary duties. The investigation identifies the nature and extent of the competing activity.
Misuse of employer resources: an employee who uses their employer’s time, systems, equipment, or contacts to build a secondary business is misappropriating employer resources, which is itself a conduct issue independent of the moonlighting.
Signs an Employee Is Working Elsewhere
- Unusual tiredness, reduced performance, or difficulty concentrating that is inconsistent with their reported health status or workload, suggesting that they are working additional hours.
- A LinkedIn profile, personal website, or professional directory listing that references employment or business activity not consistent with their current role or disclosed activities.
- References to clients, projects, or professional activities that are not part of their current role, made in social media posts, published content, or conversations with colleagues.
- Being difficult to contact during working hours in contexts where contact would normally be expected, suggesting they are occupied elsewhere.
- A pattern of sick leave that correlates with high-demand periods in a related sector or with events that would be relevant to a secondary business — trade shows, seasonal peaks, contract renewal periods.
- Registration as a director or person with significant control of a company, identifiable through Companies House, that operates in a field relevant to their primary employment.
Investigation Techniques
Companies House investigation: a systematic search for current and historical directorships, shareholder interests, and PSC registrations in the employee’s name. This is the first step in identifying any registered business activity. The investigation extends to associated entities — companies with shared addresses, registered agents, or directors who are connected to the employee through other means.
Open source intelligence: a structured review of the employee’s publicly available online presence, including professional networking profiles, social media, business websites, trade directories, and any other accessible material that might reveal secondary employment or business activity.
Employment platform and job board research: where the concern is that the employee is working for another employer, searches of job boards and employment platforms for profiles associated with the employee can identify active secondary employment.
Covert surveillance: where the concern relates to sick leave fraud and the employee is suspected of attending another workplace during their absence, covert surveillance can establish whether and where the employee travels during the absence period and whether they attend any premises associated with secondary employment.
Financial intelligence: in cases where the secondary employment or business activity has generated income, financial intelligence may identify banking relationships or payment flows that corroborate the investigation’s other findings.
Legal Considerations
An investigation into moonlighting must be conducted within the applicable legal framework. The gathering of personal data about the employee’s activities must have a lawful basis under UK GDPR. Covert surveillance must comply with the requirements applicable to private investigation in England and Wales. The evidence gathered must be preserved in a form suitable for use in disciplinary proceedings.
Contractual analysis is also important. Before commencing disciplinary action on the basis of moonlighting, the employer should review the employee’s contract to establish what restrictions apply, whether consent was required and not given, and whether the secondary activity falls within the scope of those restrictions. An employee who moonlights in a way that does not breach any contractual term may still be subject to disciplinary action if the activity creates a conflict of interest or involves misuse of employer resources, but the basis for action is different from a straightforward contractual breach.
Concerned that an employee may be working elsewhere, including during sick leave? Contact iSpy Detectives for confidential moonlighting investigations.