Moonlighting and the Legal Industry

Moonlighting and the Legal Industry

Moonlighters have existed since the very emergence and evolvement of commercialisation and work culture. In the wake of the lethal pandemic (COVID-19), necessary adoption of flexible workplace practices by corporates became cardinal essential for survival, thereby escalating the propagators of moonlighting. Moonlighting is generally the practice of accepting an additional job, assignment or project while being under permanent and preliminary employment of a company. Some people applaud the concept for honing their skills and making a few extra bucks. The others disregard moonlighting, stating the phenomenon equivalent to extra-marital affair or cheating on the first job. 

Moonlighting was not so talked about until recent disclosure from Wipro chairman Rishad Premji said “If you actually look at the definition of Moonlighting, it is having a second job secretively … I'm all about transparency”, he added that the company found 300 people to be moonlighting and working for rival companies in the last few months, adding that there was no place for such people in the company. 

Moonlighting can be also inferred to be the root cause of organisational issues such as conflict of interest, confidentiality breach, compromise of intellectual property, solicitation of organisational links. The laws usually support side hustlers, provided that they are not working for a competitor, not using the employer’s property (laptops, internet devices, etc.) and not causing any prejudice to their employer. It is the employment contract which may bind employees from taking up another source of remuneration. A non-compete clause might be an addition restricting employment with a rival organisation during employment, or even after resignation. 

Discussions over phenomena like moonlighting or side hustle often stir after sensations like that of Geoffrey Cox QC take over the media reports. Experienced lawyers are always in demand since understanding the black letters of law is not a cake walk. 

For legal professionals, ethics and laws are quintessential. Maintaining confidentiality of clients is indispensable. When people in the legal profession moonlight or are engaged in the same profession, the path ahead is not so smooth. There are ridges and grooves for both lawyers and law firms. 

In this article we will discuss the perks as well as the risks that moonlighting brings for lawyers.

Perks

Moonlighting is usually picked by employees to make more money or follow their passions while keeping up with their profession. This may bring greater satisfaction at a personal level. Supporting moonlighting employees could be favourable for law firms as well since it lowers the financial pressure. Otherwise, a desperate employee may also leave the job for another high paying employer, which eventually affects the firm. In the legal profession, connections account for success. Extended network of the employees sure holds the potential to benefit the law firm in the long run.   

Risks

Breaching Prohibiting Clause

    The employment agreement between lawyers and law firms usually restricts the lawyers from availing remuneration from any other sources, or allows with explicit written consent of the employer. If the lawyers still engage themselves outside the law firm, the act breaches the clause against moonlighting. Hence, side hustle holds the potential of endangering the lawyer’s livelihood, and may also attract legal action by the law firm. 

    Compromising Loyalty

    An employer ought to be faithful towards the employer and the business run under the employment. The contract of employment on a full time basis does not usually permit moonlighting. Employees should also maintain loyalty towards their employer and at least disclose their side hustles embraced due to financial distress.

    Loss of Productivity

      Legal professionals not only need to apply their mind, but need to hone their skills, ace at observation and focus, etc. With more things to take care of including additional assignments, the chances of affecting their productivity increase due to fatigue and burnout.  

      Prejudice to Confidentiality 

        As a lawyer, one has to deal with confidential information in abundance on a daily basis. If a law firm employee engages with a competitor or opposing counsel, there is a significant risk of compromising such privileged information. 

        Insurance Claims

          A professional liability insurance to indemnify clients for an impact of negligent services is a necessity in law firms. However, a moonlighting lawyer is not covered under such policy owned by the law firm. Uncovered claims through a dissatisfied client may land the lawyers as well as their firm in huge trouble.

          What Next for the legal professionals

          • Law firms may have an explicit policy restricting moonlighting, i.e. lawyers accepting employment outside the law firm.
          • If allowing side hustle to lawyers, have a written policy requiring lawyers to disclose details of such employment.
          • For solo practitioners, details of each client engagement must be disclosed to evade conflict of interests.
          • Also, such a disclosure should be signed by both the lawyer and the client acknowledging the fact of engagement with such an attorney and not the law firm. 
          • Moonlighting lawyers may also be held responsible for indemnifying any claims against the firm due to his/her representation of clients outside the firm.

          Employees having a plan B should not be an obstacle for employers or anyone else, unless someone’s interests are touched on. But lawyers moonlighting in another law firm or even with common clients igniting conflict of interests should not be fostered. There has to be a middle ground so that interests of attorneys are not impacted, nor the employers face any prejudice due to moonlighting in the legal industry?

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          Disclaimer: The views and opinions expressed in this article do not necessarily reflect the official policy or position of Novum Learning or Legal Practice Intelligence (LPI). While every attempt has been made to ensure that the information in this article has been obtained from reliable sources, neither Novum Learning or LPI nor the author is responsible for any errors or omissions, or for the results obtained from the use of this information, as the content published here is for information purposes only. The article does not constitute a comprehensive or complete statement of the matters discussed or the law relating thereto and does not constitute professional and/or financial advice.

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