Moonlighting: What's the Harm?

{"version":"0.3.0","atoms":[],"cards":[],"markups":[["strong"],["a",["name","OLE_LINK12"]],["em"],["a",["href","https:\/\/www.berkleydp.com","target","_new"]],["i"],["a",["href","https:\/\/www.berkleydp.com\/risk-management\/risk-resources\/","target","_new"]],["a",["href","mailto:amendelson@berkleydp.com"]]],"sections":[[1,"p",[[0,[],0,"July 28, 2022"]]],[1,"p",[[0,[],0,"\n\nConsider this scenario: An architect in your firm wants\nto design a home addition plan for a family member. Or this one: an engineer\nwants to take on a parking-lot project for a local non-profit organization she\nvolunteers for. They may want the additional experience, income and\/or\nrecognition such moonlighting projects may bring. "]]],[1,"p",[[0,[],0,"\n\nYou may think, As long as they do it on their own time,\nit\u2019s no big deal, right? Not necessarily.\n"]]],[1,"p",[[0,[],0,"\nIt\u2019s not just the designer\u2019s time that\u2019s at issue.\nThere\u2019s a very real potential that your firm could be held liable in the event\nof a claim related to the moonlighting work.\n"]]],[1,"p",[[0,[],0,"\n"],[0,[0],1,"Professional Liability Insurance"],[0,[],0,"\n"]]],[1,"p",[[0,[],0,"\nYour next question may be, But wouldn\u2019t my firm\u2019s\nprofessional liability insurance policy cover it anyway? Again, not necessarily.\nTypically, such policies specify that employees are covered\u2014but only for those\nservices performed on behalf of the firm. "]]],[1,"p",[[0,[],0,"\n\nEven if your PL insurance policy responds to such a\nclaim, keep in mind that your firm would be responsible for any deductible. In either\nevent, you need to ask yourself this: Do I want to be on the line for paying\nthe cost of a claim on a project for which my firm received no income?\n"]]],[1,"p",[[0,[],0,"\n"],[0,[0],1,"What Puts Your Firm at Risk"]]],[1,"p",[[0,[],0,"\n\nIf a claim arises out of a moonlighting project,\nanything that implicates your firm\u2019s involvement can result in imputed\nliability against your firm. Any of the following situations might imply that\nyour firm was knowledgeable about and\/or sanctioned such work:\n"]]],[1,"p",[[0,[],0,"\n\u2022 Employee\u2019s performance of moonlighting services\nduring the firm\u2019s normal work day or on the firm\u2019s premises\n"]]],[1,"p",[[0,[],0,"\n\u2022 Moonlighting employee\u2019s use of your firm\u2019s:\n\n"]]],[1,"p",[[0,[],0,"\t\t\t-Equipment (computers, printers, scanners,\nplotters)\n\n"]]],[1,"p",[[0,[],0,"\t\t\t-Software (design technology, other)\n\n"]]],[1,"p",[[0,[],0,"\t\t\t-Email account domain\n\n"]]],[1,"p",[[0,[],0,"\t\t\t-Telephone system or company-issued mobile device\n"]]],[1,"p",[[0,[],0,"\t\t\t-Letterhead, logo or other standard documentation\n"]]],[1,"p",[[0,[],0,"\nWhat\u2019s more, those who engage in moonlighting tend to\nbe less seasoned employees. This lack of experience, when coupled with the lack\nof your firm\u2019s normal QA\/QC process, creates an environment that is ripe for a\nclaim."]]],[1,"p",[[0,[],0,"\n\n"],[0,[0],1,"Protecting Your Firm"],[0,[],0,"\n"]]],[1,"p",[[0,[],0,"\nMany architectural firms affirmatively prohibit\nmoonlighting activities by addressing it in the firm\u2019s employee handbook and\nrequiring employees to sign a form to indicate that they have read and\nunderstood its contents. You may also want to include a disclaimer of liability\nand, perhaps, an indemnity in the event an employee violates the policy. Be\nsure to enforce the moonlighting restriction, however, as inconsistency can\nlead to exposure.\n"]]],[1,"p",[[0,[],0,"\nIn addition to putting your policy in writing and\ngetting it formally acknowledged by your staff, include an actual dialogue\nabout moonlighting during the onboarding and training of new employees. Also\nconsider discussing the topic at an all-employee meeting. Such interactive\nconversations can help your staff more fully understand the risks of\nmoonlighting\u2014to themselves and to the firm\u2014and help you dispel the myth that\nthere\u2019s no harm in moonlighting.\n"]]],[1,"p",[[0,[],0,"\n"],[0,[0],1,"Final Words of Advice"],[0,[],0,"\n"]]],[1,"p",[[0,[],0,"\nA design professional cannot be an effective firm\nleader and, at the same time, engage in moonlighting activities. Leaders, in\nparticular, need to devote 100% of their professional energy to the firm.\n\nLastly, if you choose to allow non-leadership staff to\nmoonlight, you should place key restrictions on such activities:\n"]]],[3,"ul",[[[0,[],0,"\nCannot be performed on the firm\u2019s premises\n"]],[[0,[],0,"\nCannot be performed on the firm time\n"]],[[0,[],0,"\nCannot make use of any of the firm\u2019s equipment,\nsoftware or material\n\n \n\n \n\n"]]]],[1,"p",[[0,[1,2],2,"Diane P. Mika, is Vice\nPresident, Director of Risk Management Education and Andrew D. Mendelson, FAIA,\nis Senior Vice President and Chief Risk Management Officer of "],[0,[3,4],2,"Berkley Design\nProfessional,"],[0,[2],1," a division of Berkley Alliance Managers which is a member\ncompany of W. R. Berkley Corporation that provides professional liability\ninsurance to design and construction professionals. "]]],[1,"p",[[0,[2],1,"Risk\nmanagement resources for design professionals can be found "],[0,[5,4],2,"here."],[0,[2],1," Andrew may be\ncontacted at "],[0,[6],1,"amendelson@berkleydp.com"],[0,[2],1,". "]]],[1,"p",[[0,[2],1,"Information\nprovided by Berkley Design Professional is for general interest and risk\nmanagement purposes only and should not be construed as legal advice nor\nconfirmation of insurance coverage. As laws regarding the use and\nenforceability of the information contained herein will vary depending upon\njurisdiction, the user of the information should consult with an attorney\nexperienced in the laws and regulations of the appropriate jurisdiction for the\nfull legal implications of the information.\u202f"]]],[1,"p",[[0,[4],1,"Practice\nmanagement recommendations should be carefully reviewed and adapted for the\nparticular project requirements, firm standards and protocols established by\nthe design professional."]]],[1,"p",[[0,[2],1,"Products\nand services are provided by one or more insurance company subsidiaries of W.\nR. Berkley Corporation. Not all products and services are available in every\njurisdiction, and the precise coverage afforded by any insurer is subject to\nthe actual terms and conditions of the policies as issued."]]]]}