In an attempt to weather the poor economic climate exacerbated by the COVID-19 pandemic, many people have taken on a ‘side hustle’. Similar to ‘moonlighting’, a ‘side hustle’ is defined as any work performed to supplement one’s primary income. With flexible working arrangements becoming more common, taking on a side venture has become a viable option for many employees.
Engaging in a side-hustle business does however expose an employee to certain risks in relation to his or her primary employment. Even if no contractual term or workplace policy precludes an employee from partaking in any side-line business, he or she may end up in hot water should it become evident that a conflict of interest exists between his or her side hustle and primary employment, or if the side hustle interferes with his or her primary workplace duties. This was demonstrated in the recent case of Bakenrug Meat (Pty) Ltd t/a Joostenberg Meat v CCMA and Others (CA8/2020)  ZALAC 4.
In Bakenrug Meat, an employee took on a side-hustle business which entailed the marketing of biltong, while she was primarily employed as a sales consultant at a meat production business. The employee was found guilty of a charge of dishonesty in that she failed to disclose her side venture to her employer, and that her venture hindered her work performance.
Upon being dismissed, the aggrieved employee referred an unfair dismissal dispute to the CCMA. The CCMA found that the dismissal was substantively fair in that the employee failed to, at the very least, inform her employer of her side business. Had the employee been transparent about her side venture with her employer from the onset, her employer would have had the opportunity to determine whether such an activity would be deemed a conflict of interest. This blatant omission, coupled with the evidence provided by the employer that the employee neglected her duties, warranted the dismissal.
The employee then approached the Labour Court to have the decision by the CCMA set aside. There, the Court held that, due to the fact that the employee was not bound to perform her duties to her primary employer 24 hours per day, no nexus could possibly exist between the duties of her primary occupation and her side business which she only partook in during her free time. It further held that a duty to disclose one’s side business only exists when a real conflict of interest is present, and not merely when there is a possibility that such a conflict may arise. The Court therefore set aside the CCMA’s decision.
On the employer’s appeal to the Labour Appeal Court, the Court placed great emphasis on the fact that the employee’s side business of the sale of biltong was very similar to her primary occupation – in meat sales with Joostenburg Meat. As she had made the conscious decision not to disclose her materially similar activities to her employer, the Court held that she was being dishonest and manifestly acted in violation of her duty of good faith to her employer. The Court therefore upheld the initial decision by the CCMA.
It is evident that this case is equally as important to employers as it is to employees. For employees, it illustrates the extent to which one’s duty of good faith towards one’s employer stretches. For employers, it highlights the possible risks in failing to establish clear workplace policies regarding side ventures, especially in a setting where flexible working arrangements are embraced.
If you are considering starting a side hustle and are unsure whether this puts you in breach of existing employment obligations, contact us today for advice,