Launching your solopreneur career isn't easy, and it can take some time before it starts generating sufficient income to support you. Unless you are a sought-after expert who can fill up his calendar like nobody's business and you can't afford to live on a limited paycheck for a couple of months, you can start doing your thing on the side while keeping your full-time job. This can sometimes get tricky, so let's look at how to navigate it.
The following isn't legal advice. If in doubt, consult a lawyer.
Is it legal?
Standard employment contracts don't include any clauses about the employee agreeing not to do any other for-profit activities outside the employment. Making money outside your main job isn't prohibited, but you probably agreed to some limits on what you can do. What most employment contracts do contain is a clause about you not commercially using the information obtained while employed, not working or collaborating with the competition, and even a non-compete clause that prohibits you from entering the industry for a specific period (usually 1 or 2 years) after you end your employment.
IP you produced during your employment
The employment contract clause to be extremely careful about is the one that states that the employer will own all intellectual property you produce during your employment (whether at work or on your own time). Your employer owning the IP produced while you're at work is logical and standard practice. But him owning the IP you create in your free time - that's unusual in most industries. If this is the case, you must carefully consider your next steps. Suppose you build an influencer profile with tons of content and tens of thousands of followers while employed and tied by a contract with this clause. It's very likely your employer can easily claim ownership of your profile, including all the content you produced. If your solopreneur activities won't involve the production of intellectual property but will be mainly consultation-based, you should be all right.
Real-world scenarios
We'll examine a few fictional scenarios to make it all easier to understand. Your situation is very likely to fall into one of them.
Scenario 1: You work as a marketing specialist for a car dealership, and on the side, you want to start consulting for beverage brands.
Even though you'll be filling the same role in both companies, you're consulting outside the industry you're employed in. There's no danger in using the corporate secrets from the main job in your freelancing activities. This is alright.
Scenario 2: You're a therapist at a mental health company helping clients with their issues. You want to start doing therapy on the side, too.
This can work, but be careful. Don't take on clients you worked with in your primary job. Also, ideally, avoid clients from the geographic area your employer focuses on - otherwise, you may breach your employment contract. If you can, do the therapy online and get clients who won't be considered potential clients of your employer.
Scenario 3: You work for a chemical company as a researcher, and on the side, you want to start consulting for other chemical companies.
This is a no-no. Your consulting roles will be in the same industry as your main job, and you will likely use the information and know-how from it in your consulting gig. You will undoubtedly be a desirable candidate for consulting, but you'll be putting yourself in danger. It doesn't matter whether the two companies are direct competitors or not.
Scenario 4: You work as a car salesman for a local BMW dealership, but on the side, you want to become a security consultant. You get a call from a Mercedes dealership about reviewing their new security system.
This is a case where you'd work for your employer's competitor but on a matter completely unrelated to your primary job. If your employment contract contains a non-compete clause, it's unlikely to distinguish between the types of work you are not allowed to do for a competitor in a given industry.
💡 Keep in mind
The lines between what's legal and what isn't can get blurry. If you get sued, your employer's lawyers can tell a very plausible story even if you did nothing wrong.
Just because something isn't illegal, it doesn't mean it can't get you in trouble.
What if the employer finds out?
Even if you break a non-compete clause but don't work in a high-profile industry or have access to precious information, it's unlikely your employer will pursue legal action if you get exposed. On the other hand, it makes it very easy for him to fire you. Our recommendation is to avoid any risky endeavors and only conduct your solopreneurship activities in a way that will allow you to look your employer in the eye if he finds out about it.
In some environments, it's normal to have side gigs. In others, not so much. Even if the side gig is perfectly legal and ethical, some bosses and co-workers may still have a problem with it. If that's the case, keep it secret, but be prepared it can be discovered anytime. Yes, it sounds dramatic, but it can make for a very uncomfortable situation, and how you handle it can define your future in a given job.
So imagine the cat's out of the bag. Your employer finds out about your freelancing endeavors, calls you to his office, sits you down, and asks for an explanation. What to say? Here are some tips:
When you're confronted, don't lie, don't look surprised, and don't panic. Act like it's completely normal and simply tell your boss what you do - don't make it look like an interrogation where you try to answer the questions with the fewest words possible. Don't mention the number of hours if you don't have to. If you do, give a broad range - "It depends, 30-60 hours a month".
Reassure the boss that you never did anything that harmed the company, that your freelancing is entirely unrelated to your job, and that you're doing it in your free time.
Then, pick a few talking points from this list:
1. We're all here for you 8 hours a day and do what you tell us to. Before and after that, we can do what we want. Some spend time with their family, some play football, some get drunk, and others do what they like, too - you like [insert here the nature of your side gig].
2. You want to become the best at what you do, and doing it for a different company or people gives you an opportunity to face new challenges, improve your skills, and grow professionally.
3. The economy is bad. You're struggling financially and need some extra money.
4. If you drop your solopreneurship activities, your job performance won't change anyway.
💡 Keep in mind
If you are doing your work, your boss has no good reason to fire you.
Part-time job
If having a full-time job while pursuing your solopreneur dreams sounds like too much, but you still want some guaranteed income, consider downgrading your full-time employment to a part-time role. You can do it in your current job or find a new one that will best align with your solopreneurship. Look for positions that give you the most time flexibility.
Remember
👉 The more high-profile your job is, the more careful you must be.
👉 There's a difference between legal and moral limits - don't push either.
👉 It's generally best to keep your activities hidden from your colleagues.
👉 Don't give your boss a reason to question your work or to fire you.
👉 When you are found out, keep calm and don't get defensive.
👉 Working full-time isn't the only option. Part-time can be a good choice, too.
Homework
1️⃣ Read your employment contract and search for a non-compete clause.
2️⃣ Ensure your employment contract doesn't give your employer rights to the intellectual property you produce in your free time.
3️⃣ Identify conflicts of interest between your work and freelancing.
4️⃣ Simulate the situation of explaining your solopreneurship to your boss.
5️⃣ Consider what you'd say if your boss offered you to work extra hours and compensate you for it.
👏 Keep that momentum going!
Next lesson
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