Moonlighting Debate: Missing the Forest For the Trees

To fire or not to fire? The framing of the moonlighting debate, affecting IT employees with multiple jobs, may be the biggest problem when one factors in the larger issue of inequality, exacerbated by neo-liberal economic policies and the COVID-19 crisis.

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“When inequality of conditions is the common law of society, the most marked inequalities do not strike the eye; when everything is nearly on the same level, the slightest are marked enough to hurt it.”

– French political scientist, historian and politician Alexis de Tocqueville, ‘Democracy in America’

 What is moonlighting?

This month, Information Technology (‘IT’) giant Wipro fired 300 employees after discovering that they work for other companies.

The issue gained prominence as the lockdown-induced ‘work-from-home’ model allowed employees to take up other projects and second jobs.

Such a move by employees has been called out as moonlighting by other major tech firms like Tata Consultancy Services, Infosys, and IBM. For instance, Infosys prohibits second jobs as violative of employment agreements that restrict dual employment, and call for disciplinary action and dismissal. IBM has called it unethical.

While contractual considerations may seem black and white, wherein employees are clearly wrong for violating standard clauses, there is more at play here that necessitates a meaningful examination of the issue.

The tech industry is also divided. For instance, C.P. Gurnani, chief executive officer (‘CEO’) of IT company Tech Mahindra, accepted moonlighting if it did not hamper employee efficiency and productivity.

To begin with, consider the charge against employees. The word ‘moonlighting’ conjures images of deceit, cheating and misleading. However, it hides a deeper reality of entrenched social inequalities and the ever increasing demands of a consumer economy.

Why are workers engaging in ‘moonlighting’?

There is wide recognition that the issues of inequality and the capitalist consumerist economy are linked. State policy, along with corporate practices, are crucial for intensifying or ameliorating problems.

The government’s capitalist or neo-liberal bent is evidenced by various agendas. This includes the incumbent Union Government’s Quixotic attempt at removing the word ‘socialism’ from the Preamble of the Constitution. In this regard, a batch of petitions, including Subramanian Swamy versus Union of India (2020), are pending before the Supreme Court. Such attempts were previously unsuccessfully made in 2010.

The word ‘moonlighting’ conjures images of deceit, cheating and misleading. However, it hides a deeper reality of entrenched social inequalities and the ever increasing demands of a consumer economy.

With respect to the moonlighting issue, a socialist perspective takes into account the prevailing economic climate and how it impacts workers.

The World Health Organization has stated that the pandemic triggered the worst economic crisis since the 1930s.

It has become increasingly difficult for people to pay for care. Even before the pandemic, half a billion people were being pushed into extreme poverty due to health-care payments. In all probability, the number is currently considerably higher.

To understand this better, consider Nobel laureate American economist Joseph E. Stiglitz’s award-winning book ‘The Price of Inequality‘ (2012), which addressed the after-effects of another economic crisis – the subprime mortgage meltdown of 2008.

He considers English economist J.M. Keynes’ views on the Industrial Revolution, and questions the role it may have played in freeing people from the chains of subsistence through increased productivity. Stiglitz echoes Keynes and asks: “How would people spend the productivity dividend?” The answer may be an increase in enjoyment of goods, or an increase in enjoyment of leisure.

The moonlighting incident evidences a society swinging towards the former, that is, an increase in enjoyment of goods by earning more money. However, considering the number of hours moonlighting employees would have to work, Keynes’ original presumption seems to have been way off mark. Particularly, is there any real choice between leisure and consumer goods in a consumerist economy?

Stiglitz explains this mistaken presumption in the following terms: “The key issue – to which Keynes repeatedly paid insufficient attention – is that of distribution.”

Existing empirical literature establishes that people have biased perceptions of the extent of inequality, wherein high-income individuals, such as managers and CEOs at IT companies, have a lower subjective perception of inequality.

The attendant monopolization of resources in a capitalist economy, to the detriment of the well-being of employees, is very much a contemporary reality.

Further, entrenched inequality within Indian society is severe. Charitable organisations federation Oxfam’s 2021 report called ‘Inequality Kills’ reported that the income of 84 per cent of Indian households declined in 2021, whereas the number of Indian billionaires grew from 102 to 142. During the pandemic period of March 2020 to November 30, 2021, the wealth of Indian billionaires increased from INR 23.14 lakh crore (USD 313 billion) to INR 53.16 lakh crore (USD 719 billion). The wealth of billionaire tycoon Gautam Adani multiplied eight-fold in this period.

This behaviour, wherein the rich get richer without added benefits to the rest of society, is called rent-seeking.

According to reports, IT major Wipro’s CEO Thierry Delaporte earned the most among his peers, at INR 79.8 crore (USD 10.5 million) in the fiscal year ending March 31, 2022, up from INR 64.3 crore (USD 8.7 million) in 2021. Infosys CEO Salil Parekh began drawing INR 72 crore (USD 10.2 million) this year, under the terms of a new contract, increasing his pay from 2021 by 88 per cent.

As per financial and business portal Moneycontrol, CEO salaries in India’s giant IT companies have grown disproportionately faster than the salaries of fresh hires in the industry.

While the median annual pay of CEOs increased by 835 per cent in a decade (from INR 3.37 crore in 2012 to Rs 31.5 crore in 2022), the median salary package of freshers grew just 45 per cent in the same duration (from Rs 2.45 lakh to Rs 3.55 lakh). When inflation rates are factored in, freshers today effectively earn less than their peers from a decade ago.

Other issues plaguing the Indian IT sector, like cutting down employee incentives, reduction of raises, and delay in on-boarding freshers, also play a role.

In view of this, let’s rephrase the issue:

The attendant monopolization of resources in a capitalist economy, to the detriment of the well-being of employees, is very much a contemporary reality. When some own abundant cash and capital, many find themselves in more precarious situations, while others, at the bottom of the pyramid, fall further.

It is the middle group that faces the moonlighting problem in IT industries. While they may have enough resources to take their families out for a fancy meal, their income does not match up to meet ever-increasing demands.

These include rising inflation on the one hand, and corporate practices on the other. Consider the common industrial design of planned and perceived obsolescence.

It is time to consider the role of India’s consumer economy and the corporate culture it supports, in allowing greater inequalities, including that of income, than ever before. A more useful analysis will include recommendations on how to make workplaces more equitable; and how to ensure that employees earn a liveable wage that ensures their needs are met without resorting to extra work.

It creates a need for constant replacement of kitchen appliances, mobile phones and laptops, children’s toys, among many other things. Consumer goods are artificially designed for a limited life, or become seemingly outdated as soon as a new model is launched. For instance, manufacturers intentionally slow down older versions of gadgets to sell costlier new models.

Further, aspirations like better education for children in costly private schools, and cultural demands of exorbitant weddings, increase expenditure across middle-income households in India. Add to this the increased pressure of health issues caused by COVID-19, and any spare income soon dries up.

What is the main takeaway to draw from the moonlighting debate?

Perhaps, moonlighting should be considered as another ramification of the economic crisis caused by the pandemic. Backlash against employees is an impulsive response by companies that only serves to make matters worse, propelling more people closer to poverty.

Allowing for employees to work multiple jobs, seems like a more constructive solution, as suggested by Rajeev Chandrashekhar, the Union Minister of State, Ministry of Electronics and IT and Skill Development. However, the notion of overworked employees spending their leisure time working yet another job is far from desirable.

The framing of the moonlighting issue as an unavoidable choice between these two polarities is a false dichotomy that misses the larger question. It is time to consider the role of India’s consumer economy and the corporate culture it supports, in allowing greater inequalities, including that of income, than ever before.

A more useful analysis will include recommendations on how to make workplaces more equitable; and how to ensure that employees earn a liveable wage that ensures their needs are met without resorting to extra work. Government policies that regulate corporate governance and effective enforcement of such laws must also be considered.

Of equal concern is the trade-off Indians are now required to make. For instance, while families are often cited as embodiments of Indian values, as evidenced by the marital rape debate, expecting employees to work more to meet rising expenses only reduces quality time spent with families.

Most importantly, policy makers must consider better solutions to tide over India’s burgeoning population during an unprecedented health and economic crisis, without compromising the true potential of India’s demographic dividend.

(If you have been let off due to moonlighting or faced any professional repercussions due to engaging in it, and would like to share your story with us for a potential follow-up piece on moonlighting, please email [email protected] with the subject ‘Moonlighting’. All accounts will be kept anonymous.)

Prachi Arya is a law and policy consultant, having worked with the tech industry for a decade.