Dual employment is the practice of working for one or more employers or working for oneself in different capacities at the same time. Dual employment is not specifically defined under a single comprehensive law in India; rather, it is covered by a number of statutes and regulations.

Dual employment is generally governed by the terms of an employee’s offer letter and appointment letter. If the letter doesn’t specify that the employee must work exclusively for the organization, the employee is free to work elsewhere. However, if the letter does specify this, the employee may be required to pay any compensation or income generated from other work to their primary employer.

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.

 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 cannot 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.

The Industrial Employment (Standing Orders) Rules, 1946, also restrict dual employment. Schedule I-B of these rules mandates that workmen should not engage in any employment that may prejudice the interests of the industrial establishment where they are employed. This provision aims to prevent conflicts of interest and ensure that employees remain dedicated to their primary job responsibilities.

The Companies Act, 2013 that deals with corporate governance, company management, and financial disclosure doesn’t provide explicit provisions regarding dual employment.

Employment contracts often include exclusivity and conflict of interest clauses and specific industry laws, such as the Factories Act, 1948 and state-specific regulations, impose restrictions on dual employment. Managing dual employment requires careful navigation of legal obligations, working hours and confidentiality agreements to avoid conflicts and ensure compliance.

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.

Disclaimer:  This is an effort by Lexcomply.com, to contribute towards improving compliance management regime. User is advised not to construe this service as legal opinion and is advisable to take a view of subject experts.

Bhavya Jain