How to manage side hustles at work

They’re an increasingly popular method for exploring hobbies and making some extra cash outside of work. But what do they mean to employers, and how can you manage the effects?

First published on Monday, Aug 23, 2021

Last updated on Monday, Aug 23, 2021

5 min read

Side hustles are the new norm.

That’s according to data from Etsy, which recorded a 72% rise in active sellers since the start of the pandemic.

But in reality, this is old news. A shift in perspectives has been on the horizon for a long time now, with millennials investing in (and profiting from) their hobbies more than any generation before them.

From graphic design guru to stock market shark, there are plenty of avenues for exploring. But as their boss, what should you do when you hear one of your employees has taken their passion for arts and crafts to the market?

Well, while side hustles are largely regarded as a good thing, there are a few pitfalls to make sure you avoid.

Should I let my employee have a side hustle?

There’s plenty of research to say that employees with hobby based second jobs are happier and more productive at their primary employment. Specifically, they’re more innovative, proactive and organised.

Side hustles are also great educators. People who run their own small enterprise pick up transferable skills like customer service, project management, and budgeting. They then take these new skills with them for the rest of their life.

Some savvy bosses might even look at it as business training that you don’t have to pay for.

So, what’s the problem?

While a worker making a bit of extra dough on the side shouldn’t be an issue in theory, there are a few risks you should consider.

The Working Time Regulations 1998

These are a set of regulations that govern the maximum time you’re allowed to spend at work a week, which is 48 hours. Having said that, they’re actually there to make sure of the opposite—that your employees are getting enough rest.

And the thing is, as their primary employer, you hold the responsibility of ensuring your employees aren’t working over that 48 hour a week threshold, even if it’s outside of the job you pay them for.

Failing to take reasonable steps to protect your workers’ safety is a big no-no. If you don’t ensure that limit on working hours, you could get slapped with a criminal offence and face an unlimited fee.

The best way to combat this problem is to encourage your employees to disclose any extra work with you. You could even implement a policy whereby they have to ask for your permission to take on work outside of their primary role.

If all else fails, you can ask them to opt out of the Working Time Regulations. Once you get this agreement in writing, you’re no longer liable for them. They’ll be able to work on their second job as long as they want, and you don’t have to keep checking up on them.

Employee Performance

If an employee’s activities outside of work start to infringe on their productivity at work, you’re looking at a problem.

Now, there are traditional disciplinary procedures for this type of behaviour... but pump the brakes for a second. Assess your options.

Our advice? Be proactive. Have an open discussion with your employee. A survey by CV-Library showed that 60% of those who take on outside work feel they need to because they don’t earn enough from their primary employment. A third of those said they’d give up their side hustle if their employer increased their salary.

That’s just one potential reason, though. You won’t know why your employees are seeking extra work unless you ask.

In any case, make sure your business is protected. It’s totally fair to have an express term in their contract that stops employees from taking up additional commercial activities if it means they’re not giving their primary work full attention during working hours.


You don’t want an employee using the same skillset for their side hustle as they do when they work for you. That’s a clear case of competition.

Luckily, any activities that conflict with their primary employer’s business interests are largely protected by an implied term of fidelity in their contract. In other words, they can’t go and do the job you pay them for elsewhere while they’re still with you.

But it’s best to be sure. Apply a non-competition policy and clause in their contract to restrict this type of activity.

And while you’re at it, check your confidentiality policy. Make sure you’ve got your confidential information under protection while your employees are outside of work.

That extends to your facilities and equipment too. After all, they’re meant for your business, not their side gig.

Are you dealing with side hustles at work?

If so, you don’t have to do it in the dark.

Light the way with BrightBase’s expansive library of expert policies, templates and guides.

BrightBase is an online software packed full of useful business resources (like how to create employment contracts).

All the documents are ready to be downloaded and used offline, and they cover a massive array of topics. Maybe you’re dealing with a side hustle right now, but tomorrow you could be handling a grievance, or onboarding a recruit. Hopefully none of those are related, though…

In any case, BrightBase has the answer to practically all your business queries. Start soaking up the knowledge today with a free demo.

And if you still need help, give our friendly advisors a ring via our 24/7 advice line, on 0800 783 2806.

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Ask away, we’ve got lightning fast answers for UK business owners and employers powered by qualified experts.

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