MoonlightingMoonlighting in IT/ITES Sector: Part III – Judicial Precedents and the Best Practices

January 18, 20230

The Previous Blog in the Series discussed the Essential Clauses of a Contract in an IT/ITES Sector as well as the Moonlighting being the Need of the Hour. This blog shall discuss the Judicial Precedents and the Best Practices to be followed in Moonlighting in the IT/ITES Sector.


1. The employers may by the way of workshops or sessions, discourage their employees from moonlighting out of concern for conflicts of interest, impact on primary job performance, misuse of company resources, absenteeism, or poor attentiveness.

2. The employers should formulate policies and rules internally with respect to moonlighting and should also add the Moonlighting Clause in the Employment Agreement.

3. The employers can use various tools to monitor their employees who are working remotely and can remain vigilant on where the employees are spending their time during the work hours.

4. The employers can deploy tools and techniques to detect and prevent risks associated with moonlighting including data leakage or abuse of resources or intellectual property and confidentiality of the company.

5. On the part of the employees, it is crucial for the employees to carefully check their employment contractwith their principal job to ensure compliance with any moonlighting policies, before looking for side jobs or businesses.


Supreme Court

1. Manohar Nathurao Samarth v. Marotrao and Ors. [MANU/SC/0350/1979]

In this case, the Supreme Court held that the disqualification of the Appellant from the election is not bad in law because Section 49 of the Life Insurance Corporation Act, 1956 read with Regulations 25, 25 (4) and 39 of Life Insurance Corporation of India (Staff) Regulations, 1960 and Sections 15 and 428 (2) of City of Nagpur Corporation Act, 1948 constitute the ineligibility or disqualification for whole time salaried employees of L.I.C. to become member of any local authority.

The Supreme Court observed that if the Appellant is already working as a full time salaried employee of LIC and becomes a member of the local authority, the same would result into less efficiency of the Appellant.

High Courts

1. Gulbahar v. Presiding Officer, Industrial Tribunal and Others [CWP No. 15088 of 2015]

(Punjab and Haryana High Court)

In this case, the Petitioner was working as a driver with the Respondent Management with effect from 15.10.2001 but later it came to the attention of the Respondent that the Petitioner was also working for one M/s Top Wheels Tours and Travels Private Limited. Therefore, the Respondent terminated the Petitioner from the employment.

The Punjab and Haryana High Court held that the termination of the Petitioner from his employment because he was engaged in dual employment was completely valid.

2. Neelakandan v. The Presiding Officer and Other [W.P. No. 13964 of 2007]

(Madras High Court)

In this case, the Petitioner had joined the services of the Respondent No. 2 in 1991. In the year 2001, the Petitioner was issued a charge memo-cum-suspension order dated 26.4.2001, in which it was stated that the petitioner, while in the employment of the Company, along with two other persons, promoted a company, named M/s. N. K. R. Chemicals Private Limited and functioned in the capacity as a Director of the said Company along with two other persons.

The Madras High Court upheld the Order of the Labour Court wherein it was held that enquiry was conducted properly, in which, the misconduct of the Petitioner has been established beyond doubt, and since the Management has lost confidence in the activities of the Petitioner, the Petitioner was not the fit person to be given any relief and therefore, the Labour Court dismissed the Industrial Dispute raised by the Petitioner.

Therefore, from the above judicial precedents, it is clear that the judiciary is of the view that opting for another employment may decrease the efficiency of an employee in his or her regular employment and same should not be done.


Moonlighting is the practice of working more than one job apart from the primary job without the knowledge of the primary employer, after regular business hours.

Moonlighting can be seen as a technique to maintain competence and productivity while also avoiding disengagement, learning new skills, and boosting passion.

However, Moonlighting may contradict the fundamental purpose of rest hours, holidays, and leave, while also having a negative impact on workers’ physical and mental health and contributing to burnout which eventually results in losing expertise, data, and technology to rivals that comes across as a huge threat to the regular employer.

In India, there is an absence of clear-cut legislation pertaining to Moonlighting that can be applied to every field of employment. Therefore, as of now, the idea of the legality of Moonlighting widely depends on the employers and their terms of appointment.

Companies may include a Conflict of Interest Clause in the employment agreement as well as an exclusive Moonlighting Clause but legal restrictions alone will not provide the desired results if there is no trust and no engagement.

The Government should play its part and create a policy on Moonlighting as part of the new labour laws in light of the present debate on Moonlighting. It might simply give what has been going on covertly for years in so many sectors a legal framework.


For any queries or feedback, please feel free to get in touch with or

Leave a Reply

Your email address will not be published. Required fields are marked *

Current day month ye@r *

© 2020-21 AMLEGALS Law Firm in Ahmedabad, Mumbai, Kolkata, New Delhi, Bengaluru for IBC, GST, Arbitration, Contract, Due Diligence, Corporate Laws, IPR, White Collar Crime, Litigation & Startup Advisory, Legal Advisory.


Disclaimer & Confirmation As per the rules of the Bar Council of India, law firms are not permitted to solicit work and advertise. By clicking on the “I AGREE” button below, user acknowledges the following:
    • there has been no advertisements, personal communication, solicitation, invitation or inducement of any sort whatsoever from us or any of our members to solicit any work through this website;
    • user wishes to gain more information about AMLEGALS and its attorneys for his/her own information and use;
  • the information about us is provided to the user on his/her specific request and any information obtained or materials downloaded from this website is completely at their own volition and any transmission, receipt or use of this site does not create any lawyer-client relationship; and that
  • We are not responsible for any reliance that a user places on such information and shall not be liable for any loss or damage caused due to any inaccuracy in or exclusion of any information, or its interpretation thereof.
However, the user is advised to confirm the veracity of the same from independent and expert sources.