Independent Practice- Standard IV(A) Loyalty

Guys,

The standard says “Independent practice for compensation is allowed if a notification if provided …and the employer consents to all terms of the proposed independent practice before it begins”.

My questions are:

  1. What if the practice is unpaid? What`s the guidance on that case?

  2. If the practice is not expected to be time consuming or hurt in any way the employee`s commitment to the company, does it need to be disclosed (and/or received approval)?

There’s an example on CFAI curriculum about an analyst serving as a town mayor. The guideline is as follows: If Mota’s mayoral duties are so extensive and time-consuming that they might detract from his ability to fulfill his responsibilities at Tyson, he should discuss his outside activities with his employer and come to a mutual agreement regarding how to manage his personal commitments with his responsibilities to his employer.

hi,

  1. even if the practice is unpaid needs to approve it. The practice can give other type of benefits like reputation, influences, networking, etc.

2)yes in any case.

Kind regards

Hm. But how about the answer from CFAI that I posted above? It doesn’t make it clear but kinds of indicate that if the activity is not time consuming it wouldn’t need discussion with the employer, correct?

It’s more than whether it’s time-consuming; there’s that “hurts the employee’s commitment” part.

If you’re doing something that prevents you from giving your employer your full loyalty, you must get permission.

Yeah, right. Thanks for the reply S2000magician.

Just a follow-up to see if I understand correctly. So, in the end, if the activity does not interfere with the employee’s full commitment, loyalty, does not compete with the employer, etc - it is not required for the employee to get permission and/or to notify (disclose) this additional activity?

You’re welcome.

Correct.

If I want to work at an investment company during the day and teach mathematics at night, I don’t need permission from the investment company to teach math.

Perfect. Thanks once again.

My pleasure.

always disclosure and ask for approval, then the company will grant you permission, but need to ask always.