I’ve worked in marketing for more than a decade, representing brands as part of larger businesses. I’ve always dreamed of branching off to start my own operation, and friends have suggested taking on some freelance consulting work or side projects to build up my reputation and finances to start my own business. Unfortunately, my work contract includes non-compete and non-solicitation clauses that seem to prevent me from doing this.
If you have already agreed to one of these clauses, the first step is to read the words carefully. Never assume what is covered. These clauses are interpreted narrowly, based on the words. They only restrict the specific activities listed and it may be your plans are not covered. If your plans are covered based on the wording, the safest option is to quit and wait out the period covered.
Lawsuits involving competing former employees can be extremely costly and hard-fought. If you have this type of clause, consult with an employment lawyer to understand your risks before taking the leap.From your description, it sounds like you are currently an employee. If that is the case, then there are two different time frames to keep in mind: while you are employed and after you are employed.
During the employment relationship, there is a general duty of good faith and loyalty owed to your employer, whether the employment contract has non-compete or non-solicit clauses or not. A crucial part of that duty of loyalty is to act in the best interests of your employer and avoid conflicts of interest. Working for clients outside of your employment may be a breach of that duty, and the non-compete clause, if it is taking business away from your employer.
Unless there is a contrary agreement, after the employment relationship ends workers are generally free to compete against their former employer as long as they do not misuse any confidential information. Courts do not like enforcing non-competition or non-solicitation provisions in employment agreements, but will do so if the restrictions are necessary to protect the employer’s business interests and are “reasonable.