How Do I Deal with Employees Who Have Multiple Jobs

Introduction

Employees often take on second jobs to supplement their income or pursue different career opportunities. While this is usually legal, it introduces considerations for both employers and employees.

As an employer, you are responsible for managing payroll and tax correctly, ensuring your staff’s working hours comply with the law, and avoiding conflicts of interest or performance issues. With the right approach and communication, you can handle multiple-job situations fairly and compliantly.

Are employees allowed to have more than one job

Yes. There is no law preventing an employee from working for more than one employer, unless their employment contract specifically prohibits it. Many people legally hold two or more part-time roles, provided they meet their contractual obligations in each job.

Some contracts include a secondary employment clause or exclusivity clause that restricts outside work. However, since 2022, such clauses are no longer enforceable for zero-hour contract workers, giving them greater flexibility to take additional work.

Employers can still require disclosure of other employment to ensure compliance with working time and conflict of interest rules.

Tax and payroll considerations

If an employee has multiple jobs, each employer operates PAYE (Pay As You Earn) separately. However, how the employee’s personal allowance is allocated affects their tax code.

1. The employee’s main job

HMRC usually applies the employee’s personal tax allowance (the amount they can earn tax-free) to their main job. This job will have a cumulative tax code such as 1257L.

2. The employee’s secondary job

Their second job will typically be taxed under an emergency or BR (basic rate) tax code. This means all earnings from the second job are taxed at the basic rate (currently 20 percent) without any personal allowance.

If the employee’s combined income pushes them into a higher tax bracket, HMRC adjusts the tax code to ensure the correct amount of tax is paid across both jobs.

As an employer, you do not need to manage this adjustment yourself. You simply process payroll using the tax code provided by HMRC. The employee can contact HMRC if they want to split their personal allowance between jobs.

3. National Insurance

National Insurance contributions (NICs) are calculated separately for each job. This means that if an employee has two jobs, they could pay NICs on both, even if their total earnings across both roles exceed the upper earnings threshold.

HMRC may refund overpaid NICs at the end of the tax year if applicable.

Working time regulations

Employers must comply with the Working Time Regulations 1998, which limit the total hours an employee can work.

The law states that an employee cannot work more than 48 hours per week on average, calculated over a 17-week period, unless they have voluntarily signed an opt-out agreement.

If an employee works multiple jobs, their total hours across all roles count toward this limit. Employers should:

Ask staff to declare if they have other jobs.

Keep records of working hours.

Obtain a written opt-out if the total exceeds 48 hours on average.

Employees must also receive adequate rest breaks: at least 11 consecutive hours of rest in every 24-hour period and one day off each week (or two consecutive days off every fortnight).

Managing performance and wellbeing

Having multiple jobs can sometimes affect an employee’s performance, punctuality, or energy levels. Employers should take a supportive but firm approach to ensure that secondary work does not interfere with the primary role.

You can manage this by:

Including a clause in contracts requiring disclosure of other employment.

Discussing concerns early if performance declines.

Ensuring workloads and expectations remain realistic.

Promoting wellbeing and encouraging employees to maintain work-life balance.

Open communication is key. Many employees can manage multiple jobs effectively if expectations are clear.

Conflict of interest

If an employee’s second job involves working for a competitor or using confidential information from your business, this could create a conflict of interest.

To prevent this, your contract should:

Prohibit employees from working for direct competitors.

Require disclosure of any secondary employment.

Emphasise confidentiality and data protection responsibilities.

If a potential conflict arises, address it through discussion or formal disciplinary processes if necessary.

Pension and auto-enrolment

Each employer must assess and auto-enrol eligible staff into their own pension scheme, even if the employee already contributes to another scheme through a second job.

The employee can choose to opt out of one or both schemes, but the employer must still offer auto-enrolment as required by law.

Managing sickness and leave

Each employer is responsible for managing sick pay, annual leave, and statutory entitlements separately. For example:

Statutory Sick Pay (SSP): The employee may qualify for SSP from both jobs if they meet the earnings threshold in each role.

Annual leave: Entitlements are calculated independently for each employer based on hours worked.

If an employee is off sick or on holiday in one role, it does not automatically mean they cannot work in their other job, provided it does not breach contractual or medical conditions.

Payroll administration tips for multiple-job employees

Always use the correct tax code as supplied by HMRC.

Keep each employment record separate in your payroll system.

Ensure accurate reporting under the Real Time Information (RTI) system.

Confirm pension and NI contributions for each job.

Issue payslips showing gross pay, deductions, and net pay for each role.

Good payroll software makes it easier to manage multiple employees, even when they have other jobs elsewhere.

Common mistakes to avoid

Failing to ask employees about secondary employment.

Ignoring total working hours across jobs and breaching the 48-hour limit.

Misapplying tax codes or National Insurance calculations.

Overlooking potential conflicts of interest with competitors.

Assuming statutory entitlements apply across both jobs automatically.

Avoiding these errors helps protect your organisation and ensures staff are treated fairly.

Conclusion

Employees can legally hold multiple jobs, but employers must handle these arrangements carefully. Each job must have its own payroll record, correct tax code, and independent contract. Employers should monitor total working hours, assess any conflicts of interest, and maintain open communication to ensure both compliance and productivity.

By managing payroll accurately and setting clear expectations, you can support staff who have more than one job while protecting your organisation’s integrity and legal obligations.