Does Moonlighting Constitute a Breach of The Employment Contract?

Does Moonlighting Constitute a Breach of The Employment Contract?

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The current state of the South African economy has created the need for many South Africans to find ways to earn an extra income. The term “moonlighting” refers to the practice of an employee having an extra job or a “side hustle” in addition to their ordinary job, usually without the knowledge of their employer. 

Moonlighting does not necessarily constitute a breach of the employment contract, although in some instances it may, depending on the contractual provisions. Recently, the Labour Court in Vilakazi v Commission for Conciliation, Mediation and Arbitration and Others (JR164/20) [2023] ZALCJHB 319 (3 November 2023) was confronted with a situation where an employee had engaged in moonlighting and was consequently dismissed as a result of her conduct. 

Dr Vilakazi took up full-time employment with Wits University as a lecturer. In her contract, she agreed to familiarise herself with all policies applicable to Wits University’s permanent academic staff. The Wits University’s Declaration of Interests Policy required that any involvement in any external institutional affairs, including moonlighting, had to be approved by the Vice-Chancellor’s office. With the ink barely dry on her permanent employment contract with Wits, Dr Vilakazi also took up employment with Kantar South Africa as an account’s director on a full-time basis. 

She was charged and later dismissed for gross misconduct in that she took up full time employment with Kantar South Africa (Pty) Ltd whilst still in the full-time employment of the University without the knowledge or authority of the University. Dr Vilakazi referred an unfair dismissal dispute to the CCMA. After conciliation failed, the matter proceeded to arbitration, where the commissioner found that the dismissal of Dr Vilakazi was both substantively and procedurally fair. The commissioner held that the two contractual relationships were mutually incompatible and could not practically exist together. On review, the Labour Court found that Dr Vilakazi had breached Wits University’s Declaration Policy and irrespective of the policy, she had breached the duty of good faith owed to her employer.

South Africa’s Constitution states that everyone has the right to work. In essence, employers can therefore not prohibit an employee from working. This does not mean that the main employer should just accept a possible negative impact on an employee’s work performance as a result of a second job. To manage the risks of activities like moonlighting proactively, employers are advised to implement clear rules and policies regarding moonlighting. The rule should indicate that the additional employment should not be in contradiction with the employment contract, harm or potentially harm the employer’s business, or affect the employee’s capacity to work for the main employer. The policies routinely describe the circumstances in which an employee may or may not have a secondary job, whether the employee needs to seek approval before taking a second job, as well as specific industries, companies, or roles in which the employee cannot hold a second job. 

In conclusion, the duty of good faith includes disclosing material information that may impact the employer’s business interests. Where an employee fails to disclose material activities to an employer, they act in violation of the duty of good faith towards their employer and may be dismissed.

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