“Can I do work ‘on the side’ so long as it doesn’t violate the non-compete I signed?”

Question: Hi, Alan. I am currently working full-time at a company as a Marketing Director. I signed a non-compete agreement when I started.

My question is this: is it okay if I do freelance marketing for clients on my own time so long as it doesn’t violate the terms of my non-compete?

Lorraine  
New York, New York

Answer: Hi, Lorraine,        

1.  Like any other agreement, a non-compete agreement means what it says, no more and no less. Most non-compete agreements are not difficult to read, or understand, for lawyers and non-lawyers alike. The usual language is something like this: “During your employment and for one year (or some other time period) after your employment, you will not render any services  (a) for any company that competes with this company, or (b) in competition with this company, whether on your own or working with others.” If that is pretty much how your non-compete agreement reads, then so long as the work you do on the side is not (a) for a competitor, or (b) competing with your employer, it is not a violation of your non-compete. 

Our 185-Point Master Guide & Checklist to Non-Competition Agreements is a perennial favorite. It takes you step-by-step through everything you need to know. To obtain your copy, just [click here.] Delivered by Email – Instantly!

2. Beware, though, that besides your non-compete agreement, your employment contract (if you have one), your company’s employee handbook and its policy manual might also contain prohibitions against your doing “side work.” Because we sometimes see restrictions on activities outside the workplace in these other places, I highly recommend you review these documents to see if they contain prohibitions against “side work.” You might ask your Human Resources representative how you can obtain a copy of these materials. You might consider even posing the question you asked me directly to your Human Resources representative, to see what he or she says in response.  

3. Even if “side work” does not violate your non-compete agreement or other express restrictions, your employer might still be upset if it finds out you have a “side business.” Many employers feel that “full-time” means “all of your working efforts,” and all of your time other than personal or relaxation time. Also, many employers are concerned that “side work” might be distracting to you, for example that it might result in telephone calls during the day. Employers also have concerns that “side work” might even involve them in lawsuits related to the employee’s “outside work.” In my own law firm, I am clear that I don’t want attorneys who work for me to have “side law practices” for those very reasons.
 
4. To prevent bad feelings and to protect your job, I would suggest that – to be safe – you ask for your employer’s prior written consent to your “side work.” The safest route would be to ask for written approval of your doing “side work.” If consent is granted, you are in the clear. If consent is not granted, you probably saved yourself from a potential problem down the line. If consent is not granted, and you want to do “side work” anyway, at least you know that you had better be extremely careful in doing so.

On our Model Letters section of our blogsite, we offer a Model Letter you can use to Request for Consent to Do “Side Work.” If you’re interested, simply [click here]. 

Many employees like to supplement their incomes by engaging in side businesses related, or even unrelated to their “day jobs.” As you can appreciate, the last thing people like yourself need to do is to lose your full-time employment as a result of “side work.” You’ve got to be careful, because there’s a lot “on the line.” This is a good example of why we all need to learn to “navigate” the employment relation to our best abilities.

Lorraine, I hope this has been helpful. Though it may seem a bit more complicated, requiring more than a simple “yes” or “no” answer, when looked at correctly it all comes down to being careful to protect your interests at work. Some might call it “defensive driving to avoid a head-on collision.”   

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Best, 
Al Sklover

© 2011 Alan L. Sklover, All Rights Reserved.