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Lots of people start businesses before leaving their full-time or part-time employment. The startup space is filled with stories from successful founders who finished their desk jobs and returned home in the evening, only to continue working until the early morning on their own projects. People exclaim, “that’s the entrepreneurial spirit!” But moonlighting, as it’s also known, can attract risks such as loss of employment or forfeiture of your valuable intellectual property. We set out below four tips to help keep you on track as you work on starting up your startup.

1. Review Your Docs

Review your employment documents and policies that govern the relationship between you and your employer, including your:

  • Employment contract;
  • Employee handbook;
  • Employer’s technology and internet usage policy; and
  • Any other employment or company policy document.

Through this process, you may find that you must do the following:

  • Declare interests in another company and make a declaration to your employer that explains the nature of your involvement with that company;
  • Not start a company similar to that of your employer, which is especially relevant if your proposed business venture would compete with your current employer; and
  • Forfeit your intellectual property rights if you created your ideas on your own device in your work office, or, a work device that you use at home. 

As there may not be any clauses directly addressing “moonlighting” in full, you will need to review your documents carefully and in the case of any doubt, consult a startup lawyer to assist in your review process.

2. Don’t Blur the Lines.

If you blur the lines between your employer’s and your own personal time, they may have a right to any intellectual property created during work hours. Keep things separate! It isn’t easy, especially if you have downtime during your work day and have a steadily increasing sleep debt. Best practice is to perform non-work-related business outside work hours and premises, on your own devices.

3. Use Your Own Device

Suppose you work on your projects in your own time and apartment, but on a laptop supplied by your employer for the purpose of fulfilling your employment duties to the company. In such cases, it is likely that the company will retain the intellectual property you create while using that device. It is equally important to separate your personal devices for your personal projects from your work equipment for your employment duties.

4. Talk to Your Employer

You may be able to negotiate an arrangement with your employer where you can balance both your personal projects and work responsibilities simultaneously. If you disclose your side projects to your employer, you may find that they offer you support and accept your proposal. When speaking with your employer about your side projects, ensure that you document their approval in writing. 

Key Takeaways

Your current employment contract may restrict your moonlighting activities, as well as any intellectual property you create. Ideally, you will be able to secure an arrangement with your employer based on a full, frank and open conversation about how to balance your personal projects and employment duties.

Questions? Get in touch on 1300 544 755.

Working on a startup? Download LegalVision’s Startup Manual – a free 60-page manual featuring 10 case studies and tips and tricks from Australia’s leading VCs and startups.


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