When Side Hustles Become a Risk
- opekoshemani
- Dec 2
- 3 min read
Side hustles, second jobs, fraud risks, and flexible careers are no longer fringe topics. They now sit at the heart of how start-ups and scaling businesses manage their people.
Two recent wake‑up calls
A striking UK example is a recent case of the Gloucestershire man with four council jobs found guilty of fraud. He held roles across several local authorities at the same time, submitting false timesheets and failing to disclose his overlapping posts. Over about 16 months, he received roughly £236,000 in salaries and benefits before data-matching and fraud checks uncovered the misconduct, leading to multiple fraud convictions and a prison sentence. The case shows how easily undisclosed multiple jobs can turn into fraud, cause reputational damage, and result in a serious breach of trust, particularly where oversight and controls are limited.
A second, equally important case is the Employment Tribunal decision in Ogumodede v Churchill Contract Services, which highlights the importance of being aware of an employee’s second job. The employee was working two full-time roles, one day job and one night job, resulting in very long days and a breach of the Working Time Regulations. She concealed her dual employment from her employer, who dismissed her from the night role after discovering the extent of the working hours. Her claims for unfair dismissal, breach of contract and unlawful deduction of wages were dismissed, with the Tribunal finding the contract illegal in practice and her dismissal substantively fair. The case underlines that employers can face criminal and regulatory risk if staff secretly work excessive hours elsewhere, and that concealment and dishonesty will weigh heavily against an employee in litigation.
Why side hustles are rising now
Economic uncertainty and repeated rounds of restructuring and redundancies, particularly in start ups and scale ups, have pushed more employees to seek second jobs or build side businesses to protect their income. Due to rising uncertainty, workers now expect to manage multiple roles or income streams over time, rather than relying on a single source of income. For start-ups and SMEs, this can be positive: side hustles can build skills, networks and resilience. However, without transparency and guardrails, it also introduces risks around conflicts of interest, working time breaches, burnout, and in rare but serious cases, fraud.
Practical steps for founders and People leaders
Start-ups and scaling businesses rarely have the audit infrastructure of larger organisations, so simple, practical controls matter most.
Set a clear, fair policy on side hustles and second jobs, requiring disclosure and approval for external work, and explaining when conflicts, working time limits or performance risks mean you may need to say no.
Ask new starters about other employment and check in periodically, framing questions around health, safety, wellbeing and fairness rather than suspicion.
Strengthen contracts with well-drafted clauses on confidentiality, conflicts of interest and (where genuinely necessary and proportionate) competition and non‑solicitation, revisiting these when roles change.
Train managers to spot red flags such as unusual working patterns, persistent fatigue, quality or responsiveness issues and to have open, non‑judgemental and supportive conversations about workload and external commitments.
Build light‑touch oversight, for example periodic spot checks on timesheets or payroll anomalies, which is how the multi‑council fraud was ultimately identified.
Balance protection with flexibility by using part‑time roles, project‑based work or transparent, agreed external work arrangements, so employees do not feel forced to hide what they are doing.
How Protean HR can support
Protean HR can help small and scaling businesses build realistic, people‑centred approaches to side hustles and multiple jobs, grounded in compliance and commercial common sense. Support can include:
Drafting or refreshing secondary employment and conflict of interest policies, aligned with your risk profile, culture and sector.
Reviewing contracts and documentation so expectations around outside work, confidentiality and working time are clear and enforceable.
Designing and delivering training for founders, HR teams and line managers on handling disclosures, early concerns, and high‑risk cases confidently.
Auditing current practices to identify gaps in controls, especially around working time, fraud risk and record‑keeping.
Advising on live employee relations issues involving undisclosed second jobs or suspected fraud, including investigation planning and fair process.
If your business is grappling with questions about employees’ side hustles or multiple jobs, Protean HR can help you protect your company while maintaining trust, flexibility and a modern, realistic approach to work.
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