Managing an Employee Who Has a Side Hustle

The rise of the gig economy and remote work has blurred the boundaries between primary jobs and side hustles. As employees seek to diversify their incomes or explore passions outside of their 9-to-5 jobs, side hustles are becoming a standard part of many professionals’ lives. While side hustles can offer creative outlets and a sense of autonomy, they can also create challenges for managers, including concerns over divided attention and potential conflicts of interest. However, with the right approach, managers can turn this dynamic into a win-win situation, ensuring that both the employee’s primary role and their side pursuits can coexist productively. The following suggestions can help.

Start With Empathy and Understanding

Managing an employee with a side hustle begins with understanding why they have taken up an additional role. Side hustles can range from freelance work and consulting to launching a small business or pursuing a creative endeavor, like writing or photography. Employees often engage in these activities to improve their financial stability, explore new interests, or build skills that might not be fully utilized in their main job.

Instead of assuming that a side hustle will detract from an employee’s productivity, take the time to understand their motivations. Open a dialogue that is rooted in curiosity rather than skepticism. This can foster a stronger relationship between you and your employee, and it shows that you value their personal growth. It can also reveal new ways to support the employee’s development, potentially by incorporating elements of their passion into their current role, if it aligns with the organization’s goals.

Set Clear Boundaries and Expectations

While it’s important to be supportive, managers also need to establish clear boundaries to ensure that the side hustle doesn’t interfere with the employee’s primary responsibilities. A transparent conversation about work hours, performance expectations, and the use of company resources for personal projects is crucial. The goal is to ensure that employees know where the lines are drawn between their main job and their side activities.

For example, it’s reasonable to expect that an employee’s side hustle should not be conducted during working hours or make use of company equipment. Clarifying these expectations helps prevent potential conflicts down the road. A manager might say, “I support your passion projects outside of work, as long as we’re aligned on how they fit alongside your responsibilities here.” This approach emphasizes mutual respect and accountability without micromanaging the employee’s time.

Emphasize Accountability Over Micromanagement

Managing an employee with a side hustle doesn’t mean scrutinizing their every move. Instead, focus on performance and results. If an employee is meeting deadlines, continuing to produce quality work, and contributing positively to the team, the fact that they have a side hustle might not be especially relevant. Emphasizing accountability encourages employees to take ownership of their role while balancing their personal pursuits.

Regular check-ins can be helpful in ensuring that expectations are being met without being invasive. These conversations should focus on the employee’s goals, any challenges they’re facing, and how they’re managing their time. For instance, you might ask, “How are you finding the balance between your role here and your other commitments?” This approach keeps the dialogue open and allows for adjustments, if needed, ensuring that side activities don’t impact the employee’s performance of their primary job.

Identify and Address Conflicts of Interest Early

Potential conflicts of interest can arise when an employee’s side hustle overlaps with their primary role. For example, if an employee is running a consulting business in the same industry as their employer, there could be concerns about competition or misuse of insider knowledge. Addressing these issues proactively can prevent misunderstandings and protect both the company and the employee.

Encourage employees to be transparent about their side activities, and create an environment in which they feel safe disclosing them. This transparency is key to identifying any potential overlaps and finding solutions that work for everyone involved. It might also be helpful to establish a policy outlining what constitutes a conflict of interest and what activities require disclosure. This reduces ambiguity and gives employees a clear understanding of what is acceptable.

Recognize the Benefits of Side Hustles

Side hustles can bring unexpected benefits to the workplace. Employees who pursue side projects often develop new skills and perspectives that can enhance their primary role. For example, someone running a small online store might gain a deeper understanding of digital marketing, or a freelance writer might sharpen their communication skills. By recognizing these advantages, managers can look for opportunities to integrate an employee’s side-hustle skills into their current job.

This approach not only makes employees feel valued for their broader talents but also aligns their personal growth with the organization’s needs. For example, a manager could say, “I noticed that your side project has given you some great insights into social media trends. Let’s discuss how you might apply some of those ideas here.” This kind of positive reinforcement encourages employees to bring their whole selves to work, potentially leading to more innovation and engagement.

Create a Culture That Values Autonomy

A supportive approach to managing employees with side hustles is part of fostering a workplace culture that values autonomy and respects employees’ time outside of work. In an era where work-life balance is increasingly prioritized, employees appreciate leaders who trust them to manage their responsibilities without imposing rigid controls. This respect for employees’ time and aspirations can boost their morale and help retain talented individuals who might otherwise seek out more flexible employers.

Creating such a culture involves encouraging open communication, providing resources for personal development, and setting clear but flexible guidelines around performance. When employees feel trusted, they’re more likely to be engaged and committed, even if they have other projects on the side. It’s about creating an environment where employees can thrive both in their role and in their personal endeavors.

Adapt and Evolve With Changing Work Dynamics

As side hustles become a more common part of the employment landscape, managers must adapt their approaches to keep pace with these changes. This means staying open to new ways of working and being willing to adjust policies as needed. For instance, remote work and flexible hours have made it easier for employees to balance multiple commitments, and organizations that embrace this flexibility can often attract and retain a more dynamic workforce.

The key is to strike a balance where employees feel empowered to pursue their passions without compromising their contributions to the team. This might mean revisiting traditional policies around moonlighting or offering professional development opportunities that align with employees’ interests outside of work. The organizations that succeed in this evolving landscape will be those that see side hustles not as a threat but as a part of the broader picture of employee engagement and satisfaction.

Ultimately, managing employees with side hustles requires a blend of empathy, clear communication, and a focus on outcomes. By understanding what drives employees, setting the right boundaries, and recognizing the potential benefits, managers can create a work environment where side hustles and primary roles coexist productively. It’s a shift in perspective — one that values the diverse experiences employees bring to the table and encourages them to grow both inside and outside the office.

“The MIT Sloan Management Review is a research-based magazine and digital platform for business executives published at the MIT Sloan School of Management.”

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