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As an employer, it may feel difficult to support your employee’s side businesses.  But first, let’s dive into why it might be beneficial to your business by supporting them.

The U.S is recognized for its great economy and hardworking population. Unfortunately, the country’s economy suffered a big blow, especially in the second quarter of the global pandemic. 

The GDP declined at a 32.9 percent rate. This is the highest decline since 1947. As a result, the working class is compelled to work harder to revive the declining economy. For instance, a growing number of employees have a side hustle in order to survive the tough times.

However, the idea of employees having a side hustle has attracted a lot of controversies among employers. In this article, we’ve explained why employers should encourage their employees to have a side hustle.

Benefits of Supporting Your Employees Side Business

Many employers strive to extract every second from their employees’ schedules, causing some employees to work overtime day in and day out. 

These are employers who view an employee’s side business as a threat to their business. But this isn’t the case. 

Instead, you can gain a lot by supporting your employees side businesses and allowing them to have thriving side hustles. Here’s how you can benefit.

Cut Training Cost  

With the ever-changing technology, employers are forced to invest in employee training programs. The goal is to help them keep up with the new trends. 

Training is a lifeline to businesses, and it comes at a higher cost. However, by supporting your employers to start side hustles, they’ll strive to grow their business so as to remain relevant in the highly competitive environment. 

This helps them acquire new skills. They’ll then use the skills mastered to run your business. This means you’ll have a team of experts at no additional training cost.

For example, IronMonk (digital marketing agency) CEO Jack Choros claimed that most of their staff have freelancing side hustles. They support them because it helps them sharpen their skills, making them better writers without the company shouldering inflated training costs.

Improves Employees Retention Rate

Employees don’t stick with employers who don’t support their goals. Therefore, you may be forced to keep looking for new employees, which could sink your investment. That’s because losing skilled employees means you have to spend more time and money on recruitment and training. And the new employees may take time to adapt to your business style.

With the current tough economic times, supporting your employees to find other ways of boosting their income motivates them and increases their loyalty to you. So, they’ll strive to achieve your business goal along with growing their side hustles. 

That means you’ll retain the right talents in your company by supporting your employee’s side businesses, and this is good for business.

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A Financially Secure Workforce is More Productive

Financial insecurity can take a toll on your employees’ productivity, directly affecting your business. Regardless of how much you pay your employees, most are always worried about potential changes that could render them jobless. 

Anxiety triggered by money affects relationships, psychological health, and physical health. Employees who have side business regardless of its size are more confident because they have an alternative plan. 

The confidence and peace of mind boost their productivity, creativity, and commitment to you. Besides, they may use income from their side hustles to pay their debts, which helps them remain calmer.

Help them Find Satisfaction

According to 2019 Gartner’s, employees study in the United States, only 13% seem to find satisfaction in their jobs. And over 46% of workers are dissatisfied. 

If your employees feel unsatisfied, they may not offer an exceptional service. Supporting their side business helps them fulfill their purpose and lead happier lives. 

The fact that your employees find their side business more fulfilling should not worry you because most still keep their day job. Their side business gives them renewed energy needed to run your business activities. 

In this condition, they’ll address customers better, be more organized and become better time managers.

A Side Business Helps Employees Better their Skills

Even if you’ve constantly been offering training courses to your workforce, it may not bear results like running a side hustle. 

A side business offers both skills and experience. This way, your employee will improve their existing skills and master new skills in the process. 

They’ll improve their communication skills, problem-solving skills, financial management skills, and so on. 

The knowledge gained from side hustles is a great asset to your business. Keep in mind that a well-equipped and skilled workforce is a lifeline to your business. 

Tips on How to Manage Employees with Side Business

While supporting employees’ side hustle comes with tons of benefits, it may cost your business if you don’t set reasonable limits. If some employees are not controlled, they may skip their day jobs or spend hours answering private business calls during working hours.

This is inappropriate and unacceptable. You can prevent this from happening by letting your employees know that you have no problem with them having a side hustle, but they must comply with your business policy. 

This will help protect your hard-earned investment. Here are practical business practices to add to your policy:

  • Must portray good working performance–  It’s important that you specify each employee’s daily obligations. 

Their performance and conduct must be good. That doesn’t mean you implement stringent regulations, keep it professional and sensible. 

For example, implement flexible working schedules and involve your employees. Make sure they understand that non-compliance or misconduct may lead to disciplinary or dismissal.

  • Comply with working time legislations-  According to the U.S. Department of Labor, employees are required to work for specific hours per day. The law dictates that they receive time off and breaks between shifts. 

An employee can choose to have a side hustle and run it during their off-days and breaks. To enhance their general well-being, advise your employees to work reasonably to avoid overworking their brains and bodies. 

And avoid denying them their rest time as that could lead to monetary penalties and fines since it’s against the law.   

  • Develop an open communication culture–  Start discussions about side hustles to encourage your employees to open up about their outside jobs. 

This helps build rapport because they’ll be convinced you have their interest at heart. 

Being honest and open boosts productivity and loyalty, and you can borrow their ideas and implement them in your business, especially from employees with thriving side businesses.

  • Protect your business assets–  Employees should not expose your business assets, such as confidential clients materials and information. 

These should remain within the business. A breach of data can harm your brand reputation, and therefore your employees should run their side hustles without exposing your business data. 

Key Takeaway

Your employees’ side hustle should not be a threat to your business.   In face, you have a lot to gain by supporting your employee’s side businesses.

It has tons of benefits like boosting their productivity, skills and giving them satisfaction. Besides, they gain new skills without you spending on educational courses. 

Whether you need advice on practical business solutions or looking for a reliable 401(k) provider, Life, Inc Retirement Services is the best option. We value your business and employees. 

Partnering with us gives you time to concentrate on your business growth as we handle the hard stuff.

If you need help finding which plan makes sense for your company, schedule a plan discussion with us or take 30 seconds to find which plan is best for your company with The Retirement Plan Evaluator.