Protect your business interests with these approaches
The Ministry of Manpower has clear rules against work pass holders and foreign domestic workers working for anyone except their employers at all times, while the Public Service Division has stated that “civil servants need to declare additional trade or work that draws income to ensure that there is no conflict of interest”.
When it comes to employees who are not work pass holders in a small company, however, the regulations are not as straightforward. Moonlighting is disapproved of generally under common law. Under the law, an employee owes a duty of fidelity and integrity to their employer. As such, “moonlighting”, which usually means being engaged in another job without the prior consent of the employer, is a breach of the employment contract.
If discovered, such a breach may allow an employer to elect whether to terminate the contract and/or make a claim against an employee for any loss or damage suffered as a consequence from the breach.
In addition to “moonlighting”, there is another concept called “non-compete”. It specifically addresses a situation where an employee obtains a freelance job and alternative employment from a competitor of the employer.
Employees should be warned that even if the are no express clauses against “moonlighting” or “non-compete”, these obligations are imputed into the contracts.
However, these obligations are not imputed after the contract expires or is terminated. If you wish to prevent your employees from working for a competitor after the existing contract of employment has ended, you will need a lawyer to assist you in drafting a binding non-compete clause, which the Court will accept as fair and reasonable.
Non-Compete Clauses In Employment Contracts
Non- compete clauses are by policy reasons not enforceable after the end of an employment contract. People have the right to pursue their livelihoods and a free market economy encourages competition, and these clauses are in principal contrary to these ideals.
However, these clauses can be enforced in exceptional cases. For such clause to be enforced, the Court must be satisfied that the clause is fair and reasonable in terms of the geographical limits, the length of time and the nature of the activity that the clause seeks to restrain the employee.
- If an employee is a skilled carpenter, it would be unfair to restrain him from working in carpentry or furniture-related businesses, after the end of his employment contract, as it would deny him his right to a livelihood.
- If the same skilled carpenter were to be trained in a special technique, it might be fair to impose a restraint on him from working in another carpentry or furniture business for a limited time period, within a certain territorial limit and against use only of that special technique.
Hire a lawyer to review your company’s employment contracts to ensure that the clauses are able to protect your business interests.
Protect Your Company’s Intellectual Property
Strengthen the existing non-compete agreements with your employees by protecting your company’s intellectual property.
Do the necessary – file for trademark, copyright and patent, and have the correct assignments in place to make sure that any processes, systems, inventions etc developed by employees during business hours and using company resources belong to your company, not to the employee who developed them on behalf of your company.
This article is for informational purposes only and should not be treated as legal advice.
If you’re unsure about how to protect your company’s intellectual property, we are here to help. Contact us for a complimentary consultation to discuss your next step now.