Dual Employment Laws in India

Dual Employment Law in India

Dual employment, also known as double employment or moonlighting, refers to the practice of 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 can raise various legal, ethical and practical issues for both the employers and the employees involved. For instance, dual employment can create conflicts of interest, breach of confidentiality, violation of contractual obligations, overwork, fatigue, poor performance, absenteeism, etc.

In this article, we will explore the legal aspects of dual employment in India and examine the relevant provisions, case laws and implications for different types of employing entities.

Legal Provisions on Dual Employment in India

There is no specific provision in the Indian labour laws that explicitly prohibits or permits dual employment in India. However, there are certain provisions in various laws that impose restrictions or conditions on dual employment for certain categories of employees or employers. These are:

• Section 60 of the Factories Act, 1948: This section applies to employees working in factories as defined under the Act. It states that no adult worker shall be required or allowed to work in any factory on any day on which he has already been working in any other factory unless prescribed by the government. This provision aims to prevent overwork and exploitation of factory workers and ensure their health and safety.

• Section 8 of Schedule I-B of the Industrial Employment (Standing Orders) Central Rules, 1946: This section applies to employees working in industrial establishments as defined under the Act. It states that a workman shall not at any time work against the interest of the industrial establishment in which he is employed and shall not take any employment in addition to his job in the establishment, which may adversely affect the interest of his employer. This provision aims to protect the employer’s interest and prevent conflicts of interest and breach of loyalty by the employees.

• State-wise Shops and Establishments Acts: These Acts apply to employees working in shops, commercial establishments, residential hotels, restaurants, theatres and other places of public amusement or entertainment as defined under the respective Acts. These Acts regulate the working hours, holidays, leaves, wages and other conditions of service of such employees. Some of these Acts also contain provisions that restrict dual employment by such employees. For example:

o Section 65 of the Bombay Shops and Establishments Act, 1948 states that no employee shall work in any establishment, nor shall any employer knowingly permit an employee to work in any establishment, on a day on which the employee is given a holiday or is on leave by the provisions of this Act.

o Section 9 of the Delhi Shops and Establishments Act, 1954 states that no person shall work about the business of an establishment or two or more establishments or an establishment and a factory over the period during which he may be lawfully employed under this Act.

These provisions aim to regulate the working hours and conditions of service of such employees and prevent overwork and exploitation by employers.

Apart from these statutory provisions, there may also be contractual provisions that prohibit or restrict dual employment by the employees. For example, an employment agreement or an appointment letter may contain a clause that requires the employee to devote his whole time and attention to his job and not engage in any other employment or profession without the prior consent of his employer. Such a clause may also specify the consequences of breach of such a condition, such as termination of service, forfeiture of salary or benefits, legal action etc.

Case Laws on Dual Employment in India

There have been several cases where courts have dealt with the issue of dual employment in India and interpreted the relevant provisions and clauses accordingly. Some of these cases are:

• Rajasthan State Road Transport Corporation vs Daya Shankar Sharma (2017): In this case, the Supreme Court held that an employee who was working as a conductor with RSRTC was also working as a teacher with another employer without obtaining permission from RSRTC. The court upheld his dismissal from service by RSRTC on the ground that he had violated Section 8 of Schedule I-B of the Industrial Employment (Standing Orders) Central Rules, 1946 as well as his terms and conditions of service.

• Suresh Kumar vs State Bank Of India (2015): In this case, the Delhi High Court held that an employee who was working as a clerk with SBI was also working as a teacher with another employer without obtaining permission from SBI. The court upheld his dismissal from service by SBI on the ground that he had violated his terms and conditions of service as well as Section 9 of the Delhi Shops and Establishments Act, 1954.

• Rajesh Kumar vs State Of Haryana (2013): In this case, the Punjab and Haryana High Court held that an employee who was working as a teacher with the Haryana Education Department was also working as a lecturer with another employer without obtaining permission from the department. The court upheld his dismissal from service by the department on the ground that he had violated his terms and conditions of service as well as Section 60 of the Factories Act, 1948.

Implications of Dual Employment in India

The implications of dual employment in India may vary depending on the type of employment, the nature of the employer, the terms and conditions of service, the statutory provisions applicable and the facts and circumstances of each case. However, some of the general implications are:

• Legal Action: An employee who engages in dual employment without obtaining permission from his employer or in violation of any statutory or contractual provision may face legal action from his employer, such as termination of service, recovery of salary or benefits, damages, injunction etc. The employer may also initiate criminal proceedings against the employee for fraud, cheating, breach of trust etc.

• Disciplinary Action: An employee who engages in dual employment may also face disciplinary action from his employer, such as suspension, demotion, warning, censure etc. The employer may also report the matter to the concerned authorities or bodies, such as professional associations, regulatory bodies, licensing authorities etc.

• Taxation: An employee who engages in dual employment may also have to pay taxes on his income from both employers. He may also have to file returns and disclose his income from both sources. He may also have to comply with the provisions of the Income Tax Act, 1961 and other relevant laws regarding taxation.

• Ethical Issues: An employee who engages in dual employment may also face ethical issues, such as conflicts of interest, breach of confidentiality, loyalty, fiduciary duty etc. He may also have to deal with the expectations and obligations of both employers and maintain a balance between them. He may also have to avoid any situation that may compromise his integrity or reputation.

Conclusion

Dual employment is a complex and controversial issue in India that involves various legal, ethical and practical aspects. There is no clear-cut law that prohibits or permits dual employment in India. However, there are certain provisions in various laws that impose restrictions or conditions on dual employment for certain categories of employees or employers. There may also be contractual provisions that prohibit or restrict dual employment by the employees. An employee who engages in dual employment without obtaining permission from his employer or in violation of any statutory or contractual provision may face legal action, disciplinary action, taxation and ethical issues. Therefore, it is advisable for an employee who wishes to engage in dual employment to obtain prior consent from his employer and comply with all the relevant laws and clauses.

References

• Section 60 of the Factories Act, 1948

• Section 8 of Schedule I-B of the Industrial Employment (Standing Orders) Central Rules, 1946

• State-wise Shops and Establishments Acts

• Rajasthan State Road Transport Corporation vs Daya Shankar Sharma (2017)

• Suresh Kumar vs State Bank Of India (2015)

• Rajesh Kumar vs State Of Haryana (2013)

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