Outside Employment: US

This Outside Employment policy helps your organization set clear expectations for side gigs, second jobs, volunteer roles, and other outside commitments, while protecting your business from conflicts of interest, confidentiality risks, and performance issues. Although there is no single federal statute that requires a standalone outside employment policy, the National Labor Relations Act (NLRA) can limit how broadly you restrict off-duty work or discipline employees for it, especially when rules could be read to chill protected concerted activity. A well-written policy focuses on legitimate business needs (like avoiding work with competitors, misuse of resources, information confidentiality, and interference with work schedules), uses a simple pre-approval or disclosure process that collects only the minimum necessary information, and applies consistently across roles and locations.

The History Behind Outside Employment Policies in the US

Outside Employment policies grew out of basic workplace control Rules & Logistics. Early versions focused on loyalty and conflicts, but modern policies had to account for wage-and-hour rules that made "moonlighting" a payroll problem, not just a management one. The Fair Labor Standards Act pushed employers to pay for all hours worked, and later Department of Labor guidance and enforcement made it risky to ignore off-the-clock work that a manager "didn't ask for" but still allowed.

Federal labor law also shaped what employers can and cannot police. The National Labor Relations Act limits overly broad rules that chill employees' protected concerted activity, including discussions about pay, working conditions, and, in some contexts, taking collective action that can overlap with outside work. The NLRB's modern rule-making and decisions on workplace policies (often litigated as "overbroad rules") pushed employers to write narrower conflict-of-interest and outside work restrictions, and to avoid language that reads like a blanket ban on second jobs or a gag rule on talking about where else you work.

Industry trends continue to influence these policies. The rise of non-competes, trade secret litigation under state law and the federal Defend Trade Secrets Act of 2016, and the platform or "gig" economy made it normal for employees to have side jobs that can overlap with customer relationships, confidential information, and company devices. Remote work then blurred the line between "after hours" and "on the clock," so employers started treating outside employment as an operational risk that needs a simple intake process, clear guidelines, and a conflict check that doesn't ask for too much information.

Which Law is the Outside Employment Policy Meant to Comply With?

If you create and distribute an Outside Employment Policy for your US-based employees, make sure it complies with the National Labor Relations Act (NLRA) and federal acquisition rules (FAR) or other contracting guidelines if you're a federal contractor or subcontractor.

How to Write a US-Specific Outside Employment Policy

• Start with "why" and introduce the concept, allow outside work while preventing conflicts of interest and interference with job responsibilities.
• Require employees to disclose planned outside roles for conflict review before they begin.
• Define the main conflict categories to evaluate, including schedule interference, competitive relationships, overlapping services, misuse of workplace resources, and confidentiality or objectivity risks.
• Explain the outcomes when a conflict is found, including declining the role or changing the arrangement to remove the conflict.
• State that proceeding with unresolved conflicts can lead to discipline, up to termination.
• Prohibit outside work during working time and prohibit using your organization's property, systems, or confidential information for outside work.
• Reinforce that employees with outside roles must still meet performance expectations, follow policies, and maintain professional conduct.
• Encourage employees to ask for guidance when they are unsure whether an outside role creates a conflict.

When to Include this Policy in Your Employee Handbook

The law does not require you to publish a policy or issue a specific notice. That said, you still have to comply with the requirements that apply to you as an employer. 

You can comply without putting this in your handbook or otherwise publishing it to employees, but including it usually pays off. A short policy helps employees find answers without a ticket to HR, and it helps supervisors handle situations the same way across teams. If you're intentionally keeping your handbook lean, this can live in another easy-to-find policy hub, but make sure employees can actually access it and managers know where to point people. 

Other Considerations

None.

Exceptions

None.