Personal projects competing with employers projects?

Question

Recently at my place of employment it was discovered that I was developing an outside personal project (personal project being a project I have been working on, in my spare time, for my own purposes, using my personal equipment).

My employer has an idea which is very similar to my outside project but has not been started, created, put out to market yet.

When I originally started working for the company I signed a non-compete contract.

My employer is now saying that because my outside/personal project is similar to theirs that I am now a competitor and breaching my original non-compete agreement.

What I would like to know is where do I stand in this situation?

Also my personal project has not been fully developed, nor is available to anyone other than myself.

So if we both don’t have full/released products (full meaning put out to the public) are we actually competitors?

There is going to be a meeting in the coming weeks to discuss this issue and would like to have a proper argument in place.

I know some of this conversation is best held with a lawyer but I don’t have the money to do that yet. I’m not looking for full legal advice just anyone who has maybe experienced this or can give any advice.

Thanks in advance!

Answer 1

Normally I'm happy to give "I'm not a lawyer, but..." advice, but not this time. You really need a lawyer, because your position depends on the exact wording of your contract, and probably the local statutes where you live.

You might be able to get relevant advice from Legal Services / Legal Aid, or at least they'll tell you where to go for specialized help.

Answer 2

Talk to lawyer as soon as possible!

Anything you hear here could be useful or could get you in trouble.

Answer 3

I am a lawyer (a UK lawyer) and I am familiair with this area, albeit employment law isn't my field of work. Which country are you in? The advice you need must be local to your country/state.

Some things to check in the meantime:

1. You say you signed a non-compete agreement. Have you read it? Typically, those agreemenhts are a) detailed and b) contain rather more than just non-compete clauses. You may even find that your agreement contains a clause which deals with ownership of IP and could have more bad news for you.

2. As a matter of contract law (and this applies in most countries), your past dev work cannot put you in breach if you were not at that time competing. By continuing the work, you could be in breach. However, the mere fact that your company hadn't previously undertaken the project doesn't mean you weren't competing - it sounds like your project is at least in the same general field of work. If you hadn't worked as an employee for this company, would you still have had the know-how, ideas and foresight to start your project?

3. If you haven't made it available, that would suggest you are not competing, and it means your company has suffered no loss. But, presuambly that state of affairs isn't intended to last forever. What are you intending to do with the software when it's finished?

4. The obvious thing to consider is whether your work to date might have some value to your employer such tha you could do a deal and assign it to them

5. If it's not been made available, and you did the work in your own time and with your own facilities, how did your employer find out?

6. In the UK (but not, I think, in the US), non-compete agreements (or 'restrictive covenants' as they are more commonly known by lawyers) are not always enforceable. This is a judgement where you definitiely need the skills of a lawyer. Generally speaking, the longer they endure and the wider they are, the less likely they are to be enforceable.

The advice you need is from an employment lawyer, but it would obviously be preferable to get a lawyer who understands a bit about software development.

I've been in the position of acting for companies who have these kinds of conversations with their developers, and I agree that you should get familiar with the legal position, but don't underestimate the benefits of taking a commercial / non-combative approach. Sounds to me like this could be as much of an opportunity as a threat.

Answer 4

If your personal project is not a for-profit venture, and you don't mind your employer profiting by your idea... this could be your opportunity to get paid to do what you were obviously willing to do for yourself, for free.