Should an Employer Allow an Employee to Work on a Side Business? A professor of business ethics advises on if and when to allow employees to moonlight on startups of their own.

Q: Should an employer allow an employee to work on a side business?

A: The question is fraught with ethical issues. The word thorny comes to mind, which is why we called on Gregory Fairchild. As an associate professor of business administration at the University of Virginia's Darden School of Business, Fairchild teaches strategy, entrepreneurship and ethics. He says the outside-work question can often be distilled to a fairly simple equation: "To what degree is there an implicit versus an explicit agreement about working on a side business?"

Yet Fairchild concedes that even explicit agreements can contain "a reasonable amount of gray," and thus be subject to all manner of lawyerly interpretation. On occasion, Fairchild says he's granted a Darden employee permission to pursue outside work, only to be overruled by the university's human resources or legal staff.