Are Employee Side Hustles a Problem?

Opinions are mixed as to whether an employee’s side hustle is a problem for you as their employer. 

As a business owner, you want your employees to be focused on their work. That said, some of the most productive employees are those that also have side hustles. How do you balance your need for optimal work with your desire to get top performers? It can be a challenge. 

In today’s blog post, we take a deep dive into some of the things to consider assessing if your employee’s side hustles are an issue.

Is It Competing with Your Business?

You don’t want employees poaching your clients for their side hustle. 

If your employee is offering the exact same services that they do in their current role as a side hustle, it may be time to talk with them. Some employers will build non-compete clauses into their work in order to protect themselves from an employee who might want to start their own firm and take important clients with them (check your state laws, as non-compete agreements may be regulated). If you did not do this upfront, getting legal advice is a good first step.

There are situations where there is so much work in your field, or side gigs are so common that as long as an employee isn’t directly taking your clients, it’s not a problem. 

Are They Hustling on the Clock?

So, your employee’s side hustle has little or nothing to do with the work that you pay them for. 

That’s great. 

The main risk to your business is then that the employee is working on their side business when they should be working for you. You should try to find out if your employee is using the equipment or tools that you provided for their side hustle, as this could increase your operating costs and bring up legal issues.

Most importantly, you should determine if you’re getting the performance and results needed from the employee. 

Do They Meet Deliverables?

Holding onto the most motivated employees can be challenging. 

If you have a hyper-productive staff member who meets their deliverables and then takes the last bit of their day to work on their own projects, that may be a price you’re willing to pay to keep them. Ask yourself if your employee is staying on schedule with their work, if they remain responsive to your emails and other communications when they should be on the clock, and if they pursue opportunities to grow in their current role. 

If so, most employers are reluctant to complain about a side hustle. Meeting their obligations to you is really what matters.

What Does Their Future Look Like?

Sometimes allowing your best employees to grow beyond you does benefit you. 

For example, if you’re a real estate brokerage, supporting your administrative assistant as they create a business as an agent can benefit you. Due to your relationship, they may end up sending business your way.

About Focus HR

Focus HR, Inc. uncomplicates the people side of business by providing small business owners with outsourced HR, project HR, and Leadership Coaching. For more information, please contact us today! 

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