How to reduce side hustling with a smarter compensation strategy

Canadian workers are hustling harder than ever — but not always out of ambition. Employment Hero’s 2025 Annual Jobs Report reveals that 35% of full-time Canadian employees now hold multiple jobs. Among younger workers, the number jumps even higher: half of those aged 18–24 are juggling side hustles alongside their main role.

For small and medium-sized business (SMB) owners and HR leaders, this creates a serious challenge. Side hustles drain energy, divide focus and chip away at loyalty. If your staff need extra jobs just to cover groceries, how long before they leave for a better offer?

The answer isn’t banning side hustles — it’s making them unnecessary. A strong, well-designed compensation strategy addresses the root causes of poly-employment. Here’s a practical playbook to help you build one.

Why side hustles are surging in Canada

The cost of living is the biggest driver. As one Canadian worker put it in the Jobs Report: “My full-time salary alone does not cover all my expenses, so additional work is non-negotiable,” explains Brigitta, a 30-year-old Education Co-ordinator from Calgary, AB. “The number of supplemental hours I work in a month directly determines whether I can afford basic necessities such as groceries.”

Regional differences add nuance:

• Quebec workers are most likely to want lower-pressure roles (60%).
• Atlantic Canada reports the lowest at 47%.
• Ontario workers are the most open to relocating for better pay and opportunities (62%).
  

This signals that while rising costs are a nationwide challenge, the regional context should shape compensation planning.

Want to see how a smarter compensation strategy could work for your team?

How your compensation strategy reduces side hustling and boosts retention

A compensation strategy is more than setting salaries — it’s the playbook for how you reward, support and retain your team. Done right, it makes side hustles unnecessary and strengthens employee retention.

Here’s how to build one, step by step.

Audit your total compensation

Start by reviewing total compensation:

• Base salaries: Do they align with market benchmarks in your industry and region?
• Benefits compensation planning: Are you covering healthcare, retirement (CPP/QPP) and wellbeing support?
• Bonus structures: Do employees have a clear path to increase earnings through performance?
• Perks: Are you offering flexibility, training or allowances that help offset cost-of-living pressures?

With the Employment Hero Work App, employees can view payslips, benefits, and leave balances all in one place — making total compensation more transparent.

Identify pressure points that fuel side hustles

Compensation isn’t just numbers on a payslip — it’s about real life. Common triggers for side hustling include:

• Rising housing and food costs: With inflation continuing to affect essentials, many employees are turning to side hustles just to keep up with rent, mortgages, and grocery bills.
• Lack of retirement planning through CPP/QPP: While the Canada Pension Plan (CPP/QPP) provides a foundation, employees often feel it’s not enough for long-term financial security without employer support.
• Minimal career progression opportunities: When workers can’t see a path to higher pay or advancement, they look outside your business — often through side hustles — to fill the gap.
• Limited flexibility to balance work and life: Rigid schedules and workloads push employees to seek income sources that let them maintain better control over their time.
  

Talk to your employees. While open conversations are essential, digital tools can help capture feedback consistently. With Employment Hero Work, managers and employees can use 1:1s to track growth, raise feedback and build a record of development — giving leaders clearer visibility into what’s really driving financial stress.

Build fair pay structures to improve employee retention

Employees are far less likely to seek outside income when they know pay is fair and predictable. Practical steps include:

• Create pay bands for each role, based on market data
• Conduct regular salary reviews to ensure competitiveness
• Establish transparent raise criteria so employees know how to grow their pay without leaving or hustling on the side

This transparency signals that your business offers stability — something Canadian workers now value more than ambition. Employment Hero Payroll automates accurate, on-time pay runs, while the Work App gives employees instant access to their payslips and salary changes — ensuring transparency.

Add benefits that make life affordable

Benefits are often the difference between financial stress and security. Go beyond the basics where possible:

• Healthcare coverage (including mental health)
• Retirement contributions (CPP/QPP matching or top-ups)
• Childcare or family support allowances
• Wellbeing perks such as gym memberships or counselling

Even small enhancements can reduce the need for supplemental income. Think of benefits as part of compensation planning, not an afterthought.

Create growth paths without adding pressure

The Jobs Report shows that more than half of Canadian workers — especially in Quebec — want roles without high pressure. That doesn’t mean they don’t want growth.

Offer progression that feels achievable:

• Skill development: Fund certifications, training and mentorship programs — but don’t stop there. Pair junior employees with mentors across departments, or sponsor short courses that directly support their career goals. For example, if an employee shows interest in leadership, cover the cost of a management skills workshop and recognize their progress on your internal channels.
• Lateral moves: Allow employees to explore new functions without “climbing” the ladder. This could mean inviting a marketing team member to sit in on a sales strategy session, or giving an operations specialist the chance to shadow a product launch. These experiences broaden skills without formal promotions and help employees feel engaged without pressure.
• Flexible progression: Recognize expertise and contribution without forcing people into management. For example, instead of adding more workload, invite an employee to present at a company all-hands via Employment Hero Work, or showcase their work in a cross-department group. This builds visibility and pride without the stress of a bigger role.

This approach keeps employees engaged without overwhelming them, reducing the appeal of side hustles as a form of personal growth or financial buffer.

Communicate your compensation philosophy

Finally, tie it all together with a clear compensation philosophy. Explain:

• Why you pay the way you do
• How pay decisions are made
• How employees can progress without needing side income

This builds trust and reduces the guesswork that often drives people to hedge with side hustles. When employees believe in your approach, they’re far more likely to commit to your business.

Gen Z: the side hustle generation

No group makes the stakes clearer than Gen Z. The Jobs Report highlights that:

• Half of Canadian workers aged 18–24 hold multiple jobs
• 62% work longer hours to prove themselves
• 55% would relocate for the right role

This cohort isn’t unmotivated — they’re ambitious but cautious. They’ll give more to employers who provide security, fairness and growth. A smart compensation strategy directly addresses their needs and reduces the lure of side hustles.

See how better compensation reduces side hustles

Side hustles are a symptom, not the problem. If your employees are working multiple jobs, your compensation strategy needs attention.

By auditing total compensation, closing gaps and communicating openly, you can reduce side hustling, boost retention and build a more committed workforce.

Ready to build a smarter compensation strategy? Book a demo today and discover how Employment Hero can help you cut side hustling while improving employee retention.