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Employers may cash in on side hustle

Employees may use their free time to seek profit from their interests or hobbies by writing a book, developing a new video game or making pottery or jewelry. Social media and the internet almost limitlessly expand the opportunity to market these side hustles and performing other outside work such as blog writing. Employees need to carefully review existing employment contracts and negotiate updated agreements to deal with these activities.

An employer may believe it owns any work done within the scope of the employee's job and seek its profits. Employers can also jeopardize employment because of this work.

The employment contract is the first stop for review. Determine whether the extent of the work performed for the employer encompasses outside activities performed on the employee's own time and gives them possible rights of ownership.

A new position at the company may be the time to renegotiate this agreement. It can provide an opportunity to exclude the side hustle from the scope of the agreement unless it jeopardizes continued employment.

The employment agreement should clearly identify this outside as being outside the scope of employment. Contracts should set forth that an employee owns all their outside work and whether job termination impacts ownership. Or, the agreement should clearly define the scope of employment, so it does not include outside work.

Likewise, non-compete clauses must be clear. Otherwise, an employer can institute claims or employment actions because that side work is perceived as competition.

Discussing these ventures with co-workers or seeking their ideas may also constitute grounds for an ownership claim by the employer or these coworkers. Caution should govern any of these discussions or involvement. A non-disclosure or confidentiality agreement or an assignment of rights may help protect a person's rights to their outside work.

A limited liability company also preserves ownership. These entities also protect personal assets from any legal claims against a business or product. A lawyer can help review and negotiate employment contracts. They may also take other steps to protect these ventures and employment.

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