The number of unemployed and underemployed individuals has been on a rise in India, in addition to low rates of wages pertaining to a fluctuating economy. A large section of people working in private sectors are subjected to work for an arbitrary number of working hours and are paid at a rate less than minimum wages. Unable to meet the expenses in an inflated economy, people have to take up dual employment or double employment.
Dual Employment in India or double employment rule in India means being employed by more than one employer at the same time. This means that an employee occupies full-time employment and receives wages from one employer while having an additional job in another organization.
Dual Employment Law in India
Under the employment law in India, there is no specific provision that talks about the legality of dual employment in India. Section 60 of the Factories Act, 1948 talks about the restriction on double employment in India, on people working in factories. The provision states that no adult worker is allowed to work in a factory when they are already working in another factory.
The law, however, is not applicable to all institutions, as not every organization falls within the meaning of the factory under the Factories Act, 1948. Organizations that are not covered by the Factories Act must specify the stipulation related to double employment by way of dual employment clause in the appointment letter or employee’s agreement or offer letter. The employment agreement must state what restrictions have been placed on double employment and that the employee is prohibited from engaging in additional employment or profession till they’re under their current employer’s services. That means that an employee can not take up dual jobs.
In addition, the various state-wise Shop and Establishment Acts applicable to establishments not covered by the Factories Act lay down provisions regarding dual employment in India in the same institution. For instance, the Delhi Shops and Establishment Act states that an employee cannot work in an establishment or factory in excess of their lawful employment period.
Double employment meaning under Shops and Establishment employment laws in India differs as they regulate the working of an employee in the same establishment after the working hours. However, both the Factories Act and Shops and Establishment laws can be applied to prevent employees from taking up double jobs.
Section 8 under Schedule I-B of the Industrial Employment (Standing Orders) Central Rules, 1946 states that a workman cannot work against the interest of an industrial establishment by taking dual employment in addition to their existing job. Different Indian courts have also held that termination of employment rules in India which states that termination of an employee who has taken up double employment, is valid as having dual jobs affects efficiency and productivity of the employee, who fails to provide 100% efforts to their job.
The Punjab and Haryana High Court in 2016 held that terminating the employment of a driver who was engaged in double employments was completely valid. Similarly, in 2012, the Madras High Court held termination of a Grade III operator to be valid when he was found to be employed as a director of another company. The courts have to take every aspect of dual employment individually to decide the validity of employee termination policy on such grounds.
The punishment for dual employment in India has not been specifically stated in the dual employment of Indian law. Through the various judicial pronouncements, it can be concluded that consequences of dual employment in India is termination of the employee having dual jobs.
It becomes pertinent for employers to take measures for protecting the company’s interest and ensure that employees provide their full time and energy to their current job. One such measure used by employers is the Moonlighting Clause.
A moonlighting clause is a negative covenant that puts a restriction on the double employment of an employee. Thus, it restricts from taking any other job while being employed by another employer. Moonlighting simply means holding another job during the working hours of employment. It is added to the employment agreement so that employees work efficiently and focus only on their current job. The moonlighting clause must be added and signed with the free consent of both the employer and employee.
The employer has to make sure that the employment agreement clearly mentions dual employment as a ground for termination of employment. The employer must also get their HR policy drafted by an experienced employment lawyer, specifically mentioning the company’s stand on dual employment and its dual employment policy.
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