I am starting a business while employed. How can I legally protect myself from my current employer?

Updated on : January 17, 2022 by Noah Young



I am starting a business while employed. How can I legally protect myself from my current employer?

Hello, while there is no actual legal document specifically protecting you from this, there are actions you can take to make sure the chances are significantly less. Let me give you a quick list of my top 4 actions.

1. Review your company's policies. It is very likely that your company has a set of specific policies for this occasion. I would recommend that you read them and learn all you can about them. They can probably be found in an employee manual. Otherwise, go talk to someone in human resources (HR). They probably knew.

2. Review all the do

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Hello, while there is no actual legal document specifically protecting you from this, there are actions you can take to make sure the chances are significantly less. Let me give you a quick list of my top 4 actions.

1. Review your company's policies. It is very likely that your company has a set of specific policies for this occasion. I would recommend that you read them and learn all you can about them. They can probably be found in an employee manual. Otherwise, go talk to someone in human resources (HR). They probably knew.

2. Review all the documents you have signed. This means looking at your employee contract. It is very likely that within that contract that you signed, there is a non-compete clause. The clause means that you cannot start a business that would compete with the company you currently work for. The clause can be valid for years after you leave the company. There may also be an intellectual property clause detailing whether your intellectual property (the work you do outside of your job) belongs to the company you work for. This is actually quite common. Check any other legal documents you have signed.

3. Time and resources of the company. Do not work on company time or use company resources. Working on company time or using company resources can cause problems for your company and yourself. Working business hours can get you fired from your current job. Businesses can act quickly against anyone who is using their resources for any purpose other than the growth of the actual business.

4. Share your intentions with the right person. Sometimes sharing your intentions can be the best idea. Now, don't think that sharing your intentions means revealing every little detail. Just give an overview of what your business would do. I would assume that the best people to speak to would be your boss and someone from human resources or legal. However, before doing this, be sure to seek the legal advice of a qualified attorney.

The most important action is to review your company policies and all the documents you have signed. Hope this helps and good luck! If you have any further questions or are looking for legal assistance for your new business, please feel free to contact me directly at Linkilaw.

As Alexandra points out, I would definitely take a look at specific company policies when it comes to this kind of thing.

You've likely already signed something that at least touches on this topic, so you'll want to go back and review any contracts to make sure.

While it's great that you have an email (a paper record is always better than verbal), I would go a step further and make sure you have something in writing with company letterhead and proper signatures. You enter a gray area when you start to separate your time / company resources. You just wa

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As Alexandra points out, I would definitely take a look at specific company policies when it comes to this kind of thing.

You've likely already signed something that at least touches on this topic, so you'll want to go back and review any contracts to make sure.

While it's great that you have an email (a paper record is always better than verbal), I would go a step further and make sure you have something in writing with company letterhead and proper signatures. You enter a gray area when you start to separate your time / company resources. You just want to describe what that really means so you don't become vulnerable. It is difficult to see around the corners or cover all the necessary bases on your own. But you should definitely make sure you are protected.

Even if you have something in writing, you probably want a lawyer to review it to be sure.

I would recommend discussing this further with a startup attorney. If you really want your business to take off, you need to protect it, especially during those first few days. For more information, see LawTrades to contact an experienced commercial attorney who can provide further guidance on this topic.

Do not use company equipment or resources. Any. Not even your wifi / internet.

Don't do anything during business hours.

Do not do anything on company premises.

Keep your email.

Leave on good terms.

Do not steal from company employees.

Don't compete with your old employer.

Keep your head down after leaving for a while.


Nothing can protect you from a lawsuit, as a lawsuit can be filed for frivolous reasons (that is, they may be wrong, you may be right, but the lawsuit will still harm you).

The best plan of action is to avoid the lawsuit altogether. That is why I did not mention anything about reading the Agr Employment

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Do not use company equipment or resources. Any. Not even your wifi / internet.

Don't do anything during business hours.

Do not do anything on company premises.

Keep your email.

Leave on good terms.

Do not steal from company employees.

Don't compete with your old employer.

Keep your head down after leaving for a while.


Nothing can protect you from a lawsuit, as a lawsuit can be filed for frivolous reasons (that is, they may be wrong, you may be right, but the lawsuit will still harm you).

The best plan of action is to avoid the lawsuit altogether. That is why I did not mention anything about reading the Employment Agreement, as hopefully they will never get into real legal arguments. Read it anyway.


An alternative course of action is to obtain the explicit permission of the CEO. That can be rewarding (Expedia was started within Microsoft after such a conversation and then ended), or it can be dangerous (if they say no, it lost some of its legal arguments and stealth).

Typically, you sign (at least here in the US) a Patented Invention Assignment Agreement (PIAA) when you join a new company. A PIAA generally assigns everything you do (whether on your time or not) to the company you are working for.

That's why it's great that you got your boss's written permission to start building your new company. But you need to do more because your boss may not have the authority to give you permission.

I would consult with an attorney and make sure (at a minimum) that I am legally covered. If the attorney suggests that an agreement be drawn up between you and

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Typically, you sign (at least here in the US) a Patented Invention Assignment Agreement (PIAA) when you join a new company. A PIAA generally assigns everything you do (whether on your time or not) to the company you are working for.

That's why it's great that you got your boss's written permission to start building your new company. But you need to do more because your boss may not have the authority to give you permission.

I would consult with an attorney and make sure (at a minimum) that I am legally covered. If the attorney suggests drafting an agreement between you and your current company, ask your attorney to do so. This will be money well spent.

The terms of your employment are subject to the Employment Contract or the Employment Guarantee that you must have signed at the time of joining this company.

I would recommend that you consult with a lawyer or share it with me so that I can read it and find out if any point prohibits you from starting your company. Don't take it lightly, as there can be serious consequences later on.

Likewise, the permission of the branch director may not be useful until it is authorized to do so by the Board of Directors through a Resolution (approved not pending).

My best wishes.

Start your business in Dubai while working

The UAE makes sure its workforce is happily employed and enjoys a work-life balance in good packages. Dubai companies follow an employee-centric approach to ensure their workforce is infused with enthusiasm and a willingness to become productive. However, many employees want to start a business while employed to explore a legal hustle and bustle.

To do so, all you need to do is obtain a NOC (No Objection Certificate) from your employer and apply for a business license with your visa. … ..

Start Your Business in Dubai While Employed Numerous UAE residents already have or want to start a business while employed to explore a legal hustle and also maximize income. a-business-while-employed.html

I agree 100% with Ken Larson

By joining a company, I have made sure that everything I have been working on is documented as an exception.

I also got an exemption while working. I presented what I wanted to do as a hobby and that I did not want my employer to incur liability because of my hobby.

If you have written permission to keep a project separate from your daily work, never use company resources. Also, never talk about it with anyone related to work again. Your thoughts are a company resource, even outside of work.

Generally, your current business would not have any rights to a business that you start on your personal time. However, you will need to review your employment contract and make sure your startup is not in breach of the terms of that contract. If you think it is a gray area, consult an attorney. Make sure you don't use any of the company's resources to start your business.

well, this is quite surprising.

You must verify your appointment letter and the conditions mentioned in it

Typically, the appointment letter states that you cannot accept employment in any other way until such time as you are employed in current organizations.

If you received the email in writing, that's good, but make sure you get it in writing from the HR department as well just to be ethically safe.

It completely depends on your country, but in general, if your employment contract states that any invention or discovery made during working hours or on the job premises, you are screwed. However, it is always good to make a written inquiry to your employer saying that you want to work on this project, unrelated to the company and your business, on your own time and that you would like an exemption from the clause "the company belongs to me ". . Get it in writing before you start working on the project and you will be protected from any claims they may make.

Carefully review the documentation that your employer asks you to sign with your application and, after joining the company, look for confidentiality agreements and collaboration agreements, as well as agreements that address the rights of inventions or other intellectual property. It is up to you to sign them or not, negotiate changes to them, or leave the company.

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