Negotiating the right to moonlight
May 12, 2014 3:14 PM   Subscribe

I’ve just been offered a product design position at a local software company, and tomorrow I’ll be negotiating the terms of my employment. I’d very much like to have the option of taking on small freelance jobs and remunerative personal projects outside of work, but the default employee agreement states that all intellectual property I produce belongs to my employer, including that developed outside of normal working hours. Is there any way I can take this job and keep my freedom?

Background: I’m about to finish my Master’s degree, and I’ve been trying to decide between taking a salaried, corporate job and trying my luck as a freelance contractor working with local startups. I’m currently doing some very low-intensity design review work for one company (<4 hours/month), I have some contacts at the local startup hub who I’d love to collaborate with, and I have some web app ideas I’d like to explore on my own and maybe, maybe spin out into a business someday. However, the corporate job is very appealing: the work is interesting and important, the pay is steady, and I feel like I could learn a lot from my co-workers there.

In my ideal world, I would take the full time corporate job (assuming the offer is fair), and continue noodling around with various other projects on evenings and weekends. Honestly, I think that having that freedom would make me a better employee: feeding my creativity, expanding my design skills, and keeping me connected to the local tech scene.

The problem is that the standard employee agreement, like many tech company employee agreements, stipulates that all IP I create that relates directly or indirectly to the work of my employer automatically belongs to them, no matter where or when I create it. To me, that sounds like I’d have to put all side projects on hold, or risk my employer laying claim to that work. None of the projects I’m interested in are directly related to the company’s work, but “indirectly related”…? That’s vague enough that I can’t be sure.

What’s the best way to raise this issue during the upcoming negotiation, and what are some good compromises I could propose? If you've been in a similar situation, how did you handle it and what were the results?
posted by Kilter to Work & Money (6 answers total) 3 users marked this as a favorite
The problem is that the standard employee agreement, like many tech company employee agreements, stipulates that all IP I create that relates directly or indirectly to the work of my employer automatically belongs to them, no matter where or when I create it

In my experience of these type of employee agreements, they are absolutely *not* trying to take the rights to things you do on your own time that have nothing to do with the company. They usually even provide a blank on the form for "inventions" you've created previously and that they therefore have no claim to. Language like "relates directly or indirectly" would typically just mean "It has to do with your day job," not "They're both code and therefore they are related." Unless this is an exceptionally draconian contract of a type I've never seen before, they wouldn't try that.

I think you should just ask them. "Moonlighting" could be bad to mention b/c a lot of companies frown on that. But you could just say, "I do personal projects at home, you're not claiming the rights to those are you?"

posted by drjimmy11 at 3:35 PM on May 12, 2014

Best answer: There is good reason for your employer to want to retain ownership of IP that they believe is related to their enterprise - as an employee, you have specific employer-provided information and background in your employer's area that you would not otherwise have. In particular, they will view something that competes with them as being partially funded by them (by way of getting you trained in the area they compete in), and hence, owned by them.

On the same hand, they don't really care about anything they don't have a profit motive in. This will require some judgement on your part. In two separate cases, I have "negotiated" with employers to agree that certain side activities are not related to the business and hence, not "work for hire" for the employer. I put negotiated in quotes because in both cases, the employer immediately agreed to the clause, allowed me to put it in writing without contest, and didn't have any resistance to my request. In both cases, the employer were appreciative that I was paying attention to the employment agreement.

If you know what you're going to do now, you can negotiate the agreement. In the future, you can disclose the activities you are considering starting to your employer to see how they react. If they claim the hypothetical work would be covered under the agreement, you may have to make a choice between leaving your employer and risking a legal battle over the work. You may ultimately decide the chance of the latter is negligible. Without knowing who you are planning to work for, I'd suggest that your employer is probably not all that interested in what you do out of work, probably values that work a lot less than you do, and probably wouldn't be able to claim the work would be covered under a fair employment agreement. If you think any of those are false, then you should be talking to an employment/IP lawyer rather than Metafilter.
posted by saeculorum at 4:08 PM on May 12, 2014

I've been told by one person that he always just rules a line through those sections (or the term "indirectly related"), striking it from the contract, initials the change, then signs and returns the document without bringing attention to the change. Apparently they've then just signed where they sign and accepted (or not noticed) the change.

I'm not suggesting you do it that way (I probably wouldn't), but wanted to offer it as an example that while you should address this issue, have confidence that it shouldn't be huge hurdle to do so.

At my current place, they wanted me to list existing inventions/projects, so I described some projects (and ideas... which are the first step of a project) using vague and extremely-broad language related to areas I was interested in, such that it should cover a wide range of personal projects.
posted by anonymisc at 4:47 PM on May 12, 2014 [1 favorite]

I recommend being upfront about it. Don't try to sneak it last them because that's the kind of shit that gets you fired of in some painful lawsuit. Ask them to limit the clause to ideas related to your assigned products and projects. If you are building software for dishwashers they shouldn't be able to claim the app you created to manage car videos.
posted by humanfont at 5:20 PM on May 12, 2014

Best answer: The way you retain the option of outside projects is to say, during negotations, "I'd like to retain the right to work on outside projects that don't conflict with your business or clients, or my obligations as an employee." If they're open to that as a concept, you discuss how you inform them of outside work so that it can be explicitly excluded from their IP claims, and along the way you keep reassuring them that they're going to get the full measure of your attention to your full time job.

If I was the manager interviewing you, I'd be less concerned about IP issues than about the fact that you would see your job with me as a "day job", something to pay the bills, until something bigger or more exciting comes along. My concerns would be mitigated by you reassuring me that you're treating these as specific side projects that are not competitive and are more interest based and exploratory, rather than being about more money or keeping employment options open.
posted by fatbird at 7:04 PM on May 12, 2014

Response by poster: Thanks for the advice, everyone. While going over the employment agreement with the HR rep, I brought up the issue in a totally nonchalant way, mentioning that there are a couple of web dev projects I'm peripherally involved with, and that that I was worried about putting those projects in a legally precarious situation. They were totally cool with it, and already had a straightforward process in place for declaring and getting approval for projects outside of work. Truly, this is the best of all possible worlds.
posted by Kilter at 9:06 AM on May 13, 2014

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