--- title: "Side Businesses & Non-Competes: Your Rights" description: "Can you start a side business while employed? Covers non-compete enforceability, moonlighting policies, IP ownership, and strategies to reduce legal risk." lang: en json-ld: | [ { "@context": "https://schema.org", "@graph": [ { "@type": [ "Organization", "LegalService" ], "@id": "https://jacobscounsellaw.com/#organization", "name": "Jacobs Counsel LLC", "alternateName": "Jacobs Counsel", "url": "https://jacobscounsellaw.com", "logo": { "@type": "ImageObject", "@id": "https://jacobscounsellaw.com/#logo", "url": "https://jacobscounsellaw.com/logo-dark.jpg", "contentUrl": "https://jacobscounsellaw.com/logo-dark.jpg", "caption": "Jacobs Counsel LLC" }, "image": { "@id": "https://jacobscounsellaw.com/#logo" }, "description": "Jacobs Counsel primarily serves gaming and regulated-product companies and provides ongoing outside counsel to growing startups; sports, NIL, creators, entertainment, media, consumer brands, and hospitality are selective adjacent transactional work. Andrew R. Jacobs is admitted to practice in New York, New Jersey and Ohio.", "foundingDate": "2022", "address": [ { "@type": "PostalAddress", "streetAddress": "135 Madison Ave., Floor 4", "addressLocality": "New York", "addressRegion": "NY", "postalCode": "10016", "addressCountry": "US" }, { "@type": "PostalAddress", "streetAddress": "221 River Street, Floor 9", "addressLocality": "Hoboken", "addressRegion": "NJ", "postalCode": "07030", "addressCountry": "US" }, { "@type": "PostalAddress", "streetAddress": "127 Willow Ave., Floor 2", "addressLocality": "Cincinnati", "addressRegion": "OH", "postalCode": "45215", "addressCountry": "US" } ], "telephone": "+1-646-343-7227", "email": "intake@jacobscounsellaw.com", "areaServed": [ { "@type": "State", "name": "New York" }, { "@type": "State", "name": "New Jersey" }, { "@type": "State", "name": "Ohio" } ], "sameAs": [ "https://www.linkedin.com/company/jacobs-counsel-law", "https://www.crunchbase.com/organization/jacobs-counsel-llc" ], "knowsAbout": [ "Outside Counsel for Companies", "Corporate Law", "Commercial Contracts", "Business Transactions", "Employment Law", "Intellectual Property", "Gaming Law", "Skill-based Gaming", "Sports Betting Regulation", "Sweepstakes and Promotional Gaming", "Multi-state Gaming Compliance", "AI Commercial Contracts", "SaaS Commercial Contracts", "Outside General Counsel", "Fractional General Counsel", "Technology Transactions", "Sports Law", "NIL Law", "Name Image and Likeness", "NCAA House v. NCAA Settlement", "College Athlete Representation", "Hospitality Law", "Liquor Licensing" ], "founder": { "@type": "Person", "@id": "https://jacobscounsellaw.com/about/drew-jacobs#person", "name": "Andrew R. Jacobs, Esq.", "alternateName": "Drew Jacobs", "url": "https://jacobscounsellaw.com/about/drew-jacobs", "jobTitle": "Founder & Managing Attorney", "image": "https://jacobscounsellaw.com/assets/drew-jacobs-headshot.jpg", "worksFor": { "@type": "LegalService", "@id": "https://jacobscounsellaw.com/#organization", "name": "Jacobs Counsel LLC", "url": "https://jacobscounsellaw.com" }, "knowsAbout": [ "Gaming law", "Sweepstakes and social casino compliance", "Skill-based gaming and predominance testing", "Sports betting and fantasy sports regulation", "Name, Image and Likeness (NIL) law", "College athlete revenue sharing", "Outside general counsel for technology and AI companies", "SaaS and commercial contracts" ], "hasOccupation": { "@type": "Occupation", "name": "Attorney", "occupationLocation": [ { "@type": "State", "name": "New York" }, { "@type": "State", "name": "New Jersey" }, { "@type": "State", "name": "Ohio" } ] }, "memberOf": { "@type": "Organization", "name": "Seton Hall University School of Law", "url": "https://law.shu.edu/" }, "sameAs": [ "https://www.linkedin.com/in/drew-jacobs-dj32/", "https://profiles.superlawyers.com/new-york/new-york/lawyer/drew-jacobs/22a7b48c-b198-47ac-a0db-4aa37ec85144.html", "https://profiles.superlawyers.com/new-jersey/hoboken/lawyer/drew-jacobs/ae1c15fc-79e2-4448-bb03-2f16bd4549e8.html", "https://www.avvo.com/attorneys/07030-nj-andrew-jacobs-5765bbd8.html", "https://iapps.courts.state.ny.us/attorneyservices/search?lastName=jacobs&firstName=andrew", "https://law.shu.edu/documents/drew-jacobs-bio.pdf", "https://jacobscounsellaw.com/about", "https://jacobscounsellaw.com/about/drew-jacobs" ] }, "employee": [ { "@type": "Person", "@id": "https://jacobscounsellaw.com/about/drew-jacobs#person", "name": "Andrew R. Jacobs, Esq.", "alternateName": "Drew Jacobs", "url": "https://jacobscounsellaw.com/about/drew-jacobs", "jobTitle": "Founder & Managing Attorney", "image": "https://jacobscounsellaw.com/assets/drew-jacobs-headshot.jpg", "worksFor": { "@type": "LegalService", "@id": "https://jacobscounsellaw.com/#organization", "name": "Jacobs Counsel LLC", "url": "https://jacobscounsellaw.com" }, "knowsAbout": [ "Gaming law", "Sweepstakes and social casino compliance", "Skill-based gaming and predominance testing", "Sports betting and fantasy sports regulation", "Name, Image and Likeness (NIL) law", "College athlete revenue sharing", "Outside general counsel for technology and AI companies", "SaaS and commercial contracts" ], "hasOccupation": { "@type": "Occupation", "name": "Attorney", "occupationLocation": [ { "@type": "State", "name": "New York" }, { "@type": "State", "name": "New Jersey" }, { "@type": "State", "name": "Ohio" } ] }, "memberOf": { "@type": "Organization", "name": "Seton Hall University School of Law", "url": "https://law.shu.edu/" }, "sameAs": [ "https://www.linkedin.com/in/drew-jacobs-dj32/", "https://profiles.superlawyers.com/new-york/new-york/lawyer/drew-jacobs/22a7b48c-b198-47ac-a0db-4aa37ec85144.html", "https://profiles.superlawyers.com/new-jersey/hoboken/lawyer/drew-jacobs/ae1c15fc-79e2-4448-bb03-2f16bd4549e8.html", "https://www.avvo.com/attorneys/07030-nj-andrew-jacobs-5765bbd8.html", "https://iapps.courts.state.ny.us/attorneyservices/search?lastName=jacobs&firstName=andrew", "https://law.shu.edu/documents/drew-jacobs-bio.pdf", "https://jacobscounsellaw.com/about", "https://jacobscounsellaw.com/about/drew-jacobs" ] } ], "potentialAction": { "@type": "ReserveAction", "target": { "@type": "EntryPoint", "urlTemplate": "https://jacobscounsellaw.com/book-consultation", "actionPlatform": [ "https://schema.org/DesktopWebPlatform", "https://schema.org/MobileWebPlatform" ] }, "result": { "@type": "Reservation", "name": "Legal Strategy Call" } } }, { "@type": "WebSite", "@id": "https://jacobscounsellaw.com/#website", "url": "https://jacobscounsellaw.com", "name": "Jacobs Counsel", "description": "Jacobs Counsel primarily serves gaming and regulated-product companies and provides ongoing outside counsel to growing startups; sports, NIL, creators, entertainment, media, consumer brands, and hospitality are selective adjacent transactional work.", "publisher": { "@id": "https://jacobscounsellaw.com/#organization" }, "potentialAction": { "@type": "SearchAction", "target": { "@type": "EntryPoint", "urlTemplate": "https://jacobscounsellaw.com/blog?search={search_term_string}" }, "query-input": "required name=search_term_string" }, "inLanguage": "en-US" } ] }, { "@context": "https://schema.org", "@type": "ItemList", "name": "Primary site navigation — Jacobs Counsel LLC", "itemListElement": [ { "@type": "SiteNavigationElement", "position": 1, "name": "Outside Counsel for Companies", "url": "https://jacobscounsellaw.com/services/outside-counsel", "description": "Company-wide primary service: ongoing outside counsel for companies across industries—contracts, corporate governance, employment, IP, transactions, and compliance" }, { "@type": "SiteNavigationElement", "position": 2, "name": "Gaming & Betting Counsel", "url": "https://jacobscounsellaw.com/clients/gaming", "description": "Gaming and esports service chooser: regulatory and licensing projects, ongoing gaming counsel, sweepstakes, fantasy, and payments" }, { "@type": "SiteNavigationElement", "position": 3, "name": "Sports, Athletes & Creators", "url": "https://jacobscounsellaw.com/sports-entertainment-attorney", "description": "Athletes, NIL, and sports business matters" }, { "@type": "SiteNavigationElement", "position": 4, "name": "Resources", "url": "https://jacobscounsellaw.com/resources", "description": "Cornerstone guides, answers, comparisons, glossary, and blog" }, { "@type": "SiteNavigationElement", "position": 5, "name": "About", "url": "https://jacobscounsellaw.com/about", "description": "The firm, the team, and how we work" }, { "@type": "SiteNavigationElement", "position": 6, "name": "Contact", "url": "https://jacobscounsellaw.com/contact", "description": "Book a 15-Minute Case Assessment" } ] }, { "@context": "https://schema.org", "@type": "ItemList", "name": "Featured destinations — Jacobs Counsel LLC", "itemListElement": [ { "@type": "SiteNavigationElement", "position": 1, "name": "Outside Counsel for Companies", "url": "https://jacobscounsellaw.com/services/outside-counsel" }, { "@type": "SiteNavigationElement", "position": 2, "name": "Gaming & Esports Legal Services (chooser)", "url": "https://jacobscounsellaw.com/clients/gaming" }, { "@type": "SiteNavigationElement", "position": 3, "name": "Gaming Regulatory, Licensing & Launch Projects", "url": "https://jacobscounsellaw.com/services/gaming-law" }, { "@type": "SiteNavigationElement", "position": 4, "name": "Gaming & Esports Outside Counsel", "url": "https://jacobscounsellaw.com/services/gaming-outside-counsel" }, { "@type": "SiteNavigationElement", "position": 5, "name": "50-State Skill Gaming Legal Opinion", "url": "https://jacobscounsellaw.com/50-state-gaming-legal-opinion" }, { "@type": "SiteNavigationElement", "position": 6, "name": "Sweepstakes & Social Casino Compliance", "url": "https://jacobscounsellaw.com/services/sweepstakes-gaming-compliance" }, { "@type": "SiteNavigationElement", "position": 7, "name": "Fantasy Sports & Prediction Markets", "url": "https://jacobscounsellaw.com/services/fantasy-sports-prediction-markets" }, { "@type": "SiteNavigationElement", "position": 8, "name": "Gaming Payments & App Store Review Support", "url": "https://jacobscounsellaw.com/services/gaming-payments-app-store-approval" }, { "@type": "SiteNavigationElement", "position": 9, "name": "International Gaming Counsel", "url": "https://jacobscounsellaw.com/services/gaming-law-international" }, { "@type": "SiteNavigationElement", "position": 10, "name": "AI & Startup Companies (audience hub)", "url": "https://jacobscounsellaw.com/clients/startups" }, { "@type": "SiteNavigationElement", "position": 11, "name": "Fractional General Counsel for AI Startups", "url": "https://jacobscounsellaw.com/fractional-general-counsel-ai-startups" }, { "@type": "SiteNavigationElement", "position": 12, "name": "Outside Counsel for SaaS & Commercial Contracts", "url": "https://jacobscounsellaw.com/outside-counsel-saas-commercial-contracts" }, { "@type": "SiteNavigationElement", "position": 13, "name": "Subscription Legal Services Buyer's Guide", "url": "https://jacobscounsellaw.com/subscription-legal-service-ai-startups-guide" }, { "@type": "SiteNavigationElement", "position": 14, "name": "AI Transition Advisory", "url": "https://jacobscounsellaw.com/services/ai-transition-advisory" }, { "@type": "SiteNavigationElement", "position": 15, "name": "NIL Endorsement Attorney", "url": "https://jacobscounsellaw.com/nil-endorsement-attorney" }, { "@type": "SiteNavigationElement", "position": 16, "name": "House Settlement / NIL Revenue Share Guide", "url": "https://jacobscounsellaw.com/nil-revenue-share-guide" }, { "@type": "SiteNavigationElement", "position": 17, "name": "Full-Stack Counsel for the AI Age", "url": "https://jacobscounsellaw.com/full-stack-counsel-ai-age" }, { "@type": "SiteNavigationElement", "position": 18, "name": "Answers", "url": "https://jacobscounsellaw.com/answers" }, { "@type": "SiteNavigationElement", "position": 19, "name": "Legal Glossary", "url": "https://jacobscounsellaw.com/glossary" }, { "@type": "SiteNavigationElement", "position": 20, "name": "Blog", "url": "https://jacobscounsellaw.com/blog" }, { "@type": "SiteNavigationElement", "position": 21, "name": "Start an Engagement", "url": "https://jacobscounsellaw.com/intake" } ] }, { "@context": "https://schema.org", "@type": "ItemList", "name": "Client audiences — Jacobs Counsel LLC", "itemListElement": [ { "@type": "SiteNavigationElement", "position": 1, "name": "Companies Across Industries", "url": "https://jacobscounsellaw.com/services/outside-counsel" }, { "@type": "SiteNavigationElement", "position": 2, "name": "Gaming Operators", "url": "https://jacobscounsellaw.com/clients/gaming" }, { "@type": "SiteNavigationElement", "position": 3, "name": "AI & Startup Companies", "url": "https://jacobscounsellaw.com/clients/startups" }, { "@type": "SiteNavigationElement", "position": 4, "name": "Athletes & NIL", "url": "https://jacobscounsellaw.com/clients/athletes" }, { "@type": "SiteNavigationElement", "position": 5, "name": "Hospitality (adjacent practice)", "url": "https://jacobscounsellaw.com/clients/hospitality" } ] }, { "@context": "https://schema.org", "@type": "ItemList", "name": "Team navigation — Jacobs Counsel LLC", "itemListElement": [ { "@type": "SiteNavigationElement", "position": 1, "name": "Our Team", "url": "https://jacobscounsellaw.com/about#team", "description": "Legal counsel, firm operations, and client support at Jacobs Counsel LLC" }, { "@type": "SiteNavigationElement", "position": 2, "name": "Andrew R. Jacobs, Esq.", "url": "https://jacobscounsellaw.com/about#drew-jacobs", "description": "Founder & Managing Attorney — Legal strategy, substantive counsel, and oversight of the firm's legal work." }, { "@type": "SiteNavigationElement", "position": 3, "name": "Kevin Wiramihardja", "url": "https://jacobscounsellaw.com/about#kevin-wiramihardja", "description": "Chief of Staff — Firm operations, systems, and team coordination." }, { "@type": "SiteNavigationElement", "position": 4, "name": "Jamee Ganal", "url": "https://jacobscounsellaw.com/about#jamee-ganal", "description": "Executive Assistant — Client experience, follow-up, and communication." } ] }, { "@context": "https://schema.org", "@type": "Article", "headline": "Side Businesses and Non-Compete Clauses: What You Can Do", "description": "Can you start a side business while employed? Covers non-compete enforceability, moonlighting policies, IP ownership, and strategies to reduce legal risk.", "author": { "@type": "Person", "@id": "https://jacobscounsellaw.com/about/drew-jacobs#person", "name": "Andrew R. Jacobs, Esq.", "alternateName": "Drew Jacobs", "url": "https://jacobscounsellaw.com/about/drew-jacobs", "jobTitle": "Founder & Managing Attorney", "image": "https://jacobscounsellaw.com/assets/drew-jacobs-headshot.jpg", "worksFor": { "@type": "LegalService", "@id": "https://jacobscounsellaw.com/#organization", "name": "Jacobs Counsel LLC", "url": "https://jacobscounsellaw.com" }, "knowsAbout": [ "Gaming law", "Sweepstakes and social casino compliance", "Skill-based gaming and predominance testing", "Sports betting and fantasy sports regulation", "Name, Image and Likeness (NIL) law", "College athlete revenue sharing", "Outside general counsel for technology and AI companies", "SaaS and commercial contracts" ], "hasOccupation": { "@type": "Occupation", "name": "Attorney", "occupationLocation": [ { "@type": "State", "name": "New York" }, { "@type": "State", "name": "New Jersey" }, { "@type": "State", "name": "Ohio" } ] }, "memberOf": { "@type": "Organization", "name": "Seton Hall University School of Law", "url": "https://law.shu.edu/" }, "sameAs": [ "https://www.linkedin.com/in/drew-jacobs-dj32/", "https://profiles.superlawyers.com/new-york/new-york/lawyer/drew-jacobs/22a7b48c-b198-47ac-a0db-4aa37ec85144.html", "https://profiles.superlawyers.com/new-jersey/hoboken/lawyer/drew-jacobs/ae1c15fc-79e2-4448-bb03-2f16bd4549e8.html", "https://www.avvo.com/attorneys/07030-nj-andrew-jacobs-5765bbd8.html", "https://iapps.courts.state.ny.us/attorneyservices/search?lastName=jacobs&firstName=andrew", "https://law.shu.edu/documents/drew-jacobs-bio.pdf", "https://jacobscounsellaw.com/about", "https://jacobscounsellaw.com/about/drew-jacobs" ] }, "publisher": { "@type": "Organization", "name": "Jacobs Counsel LLC", "url": "https://jacobscounsellaw.com", "logo": { "@type": "ImageObject", "url": "https://jacobscounsellaw.com/logo-dark.jpg" } }, "datePublished": "2025-10-15T00:00:00.000Z", "dateModified": "2026-06-30T03:08:56.358Z", "image": "https://jacobscounsellaw.com/assets/blog-side-business-noncompete-teavf-6e.jpg", "mainEntityOfPage": { "@type": "WebPage", "@id": "https://jacobscounsellaw.com/blog/side-businesses-non-compete" }, "speakable": { "@type": "SpeakableSpecification", "cssSelector": [ ".answer-block-text", ".key-takeaways-list" ] } }, { "@context": "https://schema.org", "@type": "BreadcrumbList", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://jacobscounsellaw.com" }, { "@type": "ListItem", "position": 2, "name": "Resources", "item": "https://jacobscounsellaw.com/resources" }, { "@type": "ListItem", "position": 3, "name": "Side Businesses and Non-Compete Clauses: What You Can Do", "item": "https://jacobscounsellaw.com/blog/side-businesses-non-compete" } ] } ] --- [Skip to main content](#main-content) [![Jacobs Counsel LLC logo](/assets/logo-header-D2qrDHtH.jpg)](/) Services [Outside Counsel](/services/outside-counsel) [Outside Counsel for Companies](/services/outside-counsel)[AI & Startup Companies](/clients/startups)[Fractional General Counsel](/fractional-general-counsel-ai-startups)[SaaS & Commercial Contracts](/outside-counsel-saas-commercial-contracts)[AI Transition Advisory](/services/ai-transition-advisory)[Deal Support](/services/deal-support)[Business Transactions](/services/business-transactions)[Brand & IP](/services/brand-ip) [Gaming & Betting](/clients/gaming) [Gaming Regulatory & Launch Projects](/services/gaming-law)[50-State Gaming Legal Opinion](/50-state-gaming-legal-opinion)[Gaming & Esports Outside Counsel](/services/gaming-outside-counsel)[Sweepstakes & Social Casino](/services/sweepstakes-gaming-compliance)[Fantasy & Prediction Markets](/services/fantasy-sports-prediction-markets)[Payments & App Store Review Support](/services/gaming-payments-app-store-approval)[International Gaming](/services/gaming-law-international) [Sports, Athletes & Creators](/sports-entertainment-attorney) [NIL & Endorsements](/nil-endorsement-attorney)[Revenue Share Guide](/nil-revenue-share-guide)[NIL Laws by State](/nil-laws-by-state)[Media & NIL Deals](/services/media-nil)[Creator Rights](/services/content-creator-rights) Featured [50-State Gaming Legal Opinion](/50-state-gaming-legal-opinion) Our flagship deliverable — a state-by-state legal analysis of your product's mechanics and legal posture. [All services →](/services) [Free Guides](/resources) Insights [Blog](/blog)[Answers](/answers)[Deal Anatomy](/deal-anatomy)[Compare](/compare)[Guides](/resources)[Court Vision Weekly](/court-vision-weekly) About [Email](mailto:intake@jacobscounsellaw.com)[Schedule a Call](/book-consultation) [Schedule a Call](/book-consultation)[](mailto:intake@jacobscounsellaw.com)Toggle menu [← Back to Blog](/blog) ![Side Businesses and Non-Compete Clauses: What You Can Do - Outside Counsel legal advice from Jacobs Counsel LLC](/assets/blog-side-business-noncompete-teavf-6e.jpg) Outside Counsel # Side Businesses and Non-Compete Clauses: What You Can Do Published: October 15, 2025 | Updated: June 30, 2026 13 min read ShareExport By [Andrew R. Jacobs, Esq.](/about) | Founder & Managing Attorney, Jacobs Counsel LLC | Director, Sports, Entertainment & Gaming Initiatives, Seton Hall University School of Law | Super Lawyers Rising Star 2026 Quick answer But a non-compete clause does not always mean the end of your entrepreneurial dream. Understanding what these agreements are, how they are enforced, and what your rights are is the first step toward navigating this complex legal landscape. In this article 1. [What is a Non-Compete Clause?](#what-is-a-non-compete-clause) 2. [Are Non-Compete Clauses Even Enforceable?](#are-non-compete-clauses-even-enforceable) 3. [1\. Geographic Scope](#1-geographic-scope) 4. [2\. Time Duration](#2-time-duration) 5. [3\. Scope of Activity](#3-scope-of-activity) 6. [The Duty of Loyalty: An Unwritten Rule](#the-duty-of-loyalty-an-unwritten-rule) 7. [Strategies for Pursuing Your Side Business](#strategies-for-pursuing-your-side-business) 8. [1\. Analyze Your Agreement and Your Business Idea](#1-analyze-your-agreement-and-your-business-idea) 9. [2\. Maintain a Clean Separation](#2-maintain-a-clean-separation) 10. [3\. Seek Permission and Transparency](#3-seek-permission-and-transparency) 11. [4\. Consult with an Employment Lawyer](#4-consult-with-an-employment-lawyer) 12. [Final Thoughts](#final-thoughts) 📋 This article is part of our Outside Counsel practice → [Learn about our outside counsel services](/services/outside-counsel) #### Key Takeaways - **Non-competes are increasingly restricted**—many states limit or ban them - **Read your employment agreement**—know what you signed - **Side businesses may be permitted**—if they don't compete directly - **Negotiate before you sign**—it's harder to change terms later #### ⚖️ Non-Compete Enforceability by State State Non-Compete Status Notes California ❌ Banned Completely unenforceable New York ⚠️ Restricted Proposed ban pending Illinois ⚠️ Limited Income thresholds apply Texas ✅ Enforceable Must be reasonable Florida ✅ Enforceable Presumed valid if reasonable The desire to build something of your own, even while holding a full-time job, is a powerful driver of innovation. Starting a side business or "side hustle" can be a fulfilling way to explore a passion, develop new skills, and create an additional income stream. However, many employees find their entrepreneurial ambitions blocked by a common legal document: the non-compete clause. These clauses, often buried in employment agreements, can create a confusing and intimidating barrier. But a non-compete clause does not always mean the end of your entrepreneurial dream. Understanding what these agreements are, how they are enforced, and what your rights are is the first step toward navigating this complex legal landscape. This post will explore the challenges of starting a side business while under a non-compete agreement. We will cover the enforceability of these clauses, common exceptions, and provide actionable strategies to help you pursue your goals without jeopardizing your current employment. ## What is a Non-Compete Clause? A non-compete clause, or non-compete agreement (NCA), is a contract where an employee agrees not to work for a competitor or start a competing business for a certain period after leaving their job. The stated purpose is to protect the employer's legitimate business interests, such as trade secrets, confidential information, and client relationships. While they primarily apply to your actions after you leave a company, they are often written broadly enough to restrict your activities—including side businesses—during your employment. These clauses can feel restrictive, but they are not always legally airtight. Courts and state legislatures have placed significant limits on their power. ## Are Non-Compete Clauses Even Enforceable? The enforceability of a non-compete agreement depends heavily on state law and the specific terms of the contract. Courts are often skeptical of these clauses because they can limit a person's ability to earn a living. For a non-compete to be considered valid and enforceable, it must generally be reasonable in three key areas: ### 1\. Geographic Scope An enforceable non-compete must be limited to a reasonable geographic area. A clause that prevents you from working in a specific city or region where the company does business might be upheld. However, a clause that prohibits you from working anywhere in the country, or even the world, is almost always considered unreasonable and unenforceable. ### 2\. Time Duration The time restriction must be fair. A non-compete that lasts for six months to a year after employment is often seen as reasonable. A restriction that lasts for five or ten years, on the other hand, would likely be struck down by a court as an unfair restraint on trade. ### 3\. Scope of Activity This is the most critical factor for a potential side business. The agreement can only restrict you from engaging in activities that are directly competitive with your employer's business. A vaguely worded clause that forbids "any business activity" is unlikely to hold up. For example, if you are a software developer for a healthcare tech company, a non-compete cannot legally stop you from starting a side business that sells handmade furniture online. The two businesses are completely unrelated. It's important to note that some states have taken a firm stance against non-competes. California, Oklahoma, and North Dakota, for instance, have banned nearly all non-compete agreements for employees. Other states have passed laws prohibiting them for low-wage workers. The legal ground is constantly shifting, so understanding your state's specific laws is crucial. ## The Duty of Loyalty: An Unwritten Rule Even without a formal non-compete, all employees owe their employer a "duty of loyalty." This is a legal principle that requires you to act in your employer's best interest while you are employed by them. Starting a side business can potentially violate this duty if: You work on your side business during company time. You use company resources (laptops, software, printers) for your side hustle. You solicit your employer's clients for your own business. Your side business directly competes with your employer. Violating the duty of loyalty can be grounds for termination, even if you don't have a non-compete clause. Always maintain a clear separation between your day job and your side business. ## Strategies for Pursuing Your Side Business If you have a non-compete and an idea for a side hustle, don't give up. A thoughtful and strategic approach can help you navigate the restrictions and protect yourself legally. ### 1\. Analyze Your Agreement and Your Business Idea First, carefully read your employment agreement. Does it actually contain a non-compete clause? If so, what exactly does it say? Pay close attention to the definition of "competing business." Next, honestly assess your side business idea. Is it in the same industry as your employer? Does it target the same customers? Could it in any way be seen as competitive? If your side hustle is in a completely different field, you are likely on safe ground. The more overlap there is, the more caution you need to exercise. ### 2\. Maintain a Clean Separation This is non-negotiable. Your side business must be entirely separate from your day job. **Time**: Only work on your side business on your own time—nights, weekends, and lunch breaks (off-site). **Equipment**: Use your personal computer, personal phone, and personal email address for all side business activities. **Funding**: Never use a company credit card or expense account for your side business. **Confidentiality**: Be extremely careful not to use any of your employer's confidential information, client lists, or trade secrets. This is often a separate and more serious legal issue than violating a non-compete. ### 3\. Seek Permission and Transparency While it may seem counterintuitive, one of the safest approaches is to be transparent with your employer. If you are confident your side business does not compete, consider discussing it with your manager or HR department. You can frame it as a professional development opportunity or a personal hobby. Many employers are supportive of their employees' entrepreneurial ventures, provided they don't create a conflict of interest. Getting written permission is the ultimate protection. An email from your manager or HR representative approving your side business can serve as powerful evidence if your right to operate it is ever challenged. ### 4\. Consult with an Employment Lawyer When in doubt, get professional legal advice. An employment lawyer can review your non-compete agreement, explain the relevant state laws, and assess the risk of your proposed side business. The cost of a legal consultation is a small investment compared to the potential cost of a lawsuit or losing your job. A lawyer can help you understand the real-world risks and may even help you negotiate a waiver or clarification from your employer. ## Final Thoughts A non-compete clause can seem like a roadblock to your entrepreneurial aspirations, but it is often more of a speed bump. These agreements are not all-powerful, and the law provides significant protections for an individual's right to pursue business opportunities. The key is to be informed, cautious, and strategic. By thoroughly understanding your agreement, ensuring your side business is truly non-competitive, and maintaining a strict separation from your employer's resources, you can build your venture on a solid legal foundation. Don't let legal jargon intimidate you. With the right knowledge and approach, you can successfully balance your day job with your entrepreneurial passion. ### 📊 Non-Compete Enforceability by State State Enforceability Side Business Impact California Not enforceable Free to operate New York Narrowly enforced Must be different industry Texas Enforceable if reasonable Review specific terms Florida Strongly enforced High risk without review Illinois Limited (income threshold) Check salary requirements #### ✅ Side Business Safety Checklist - ☐ Review employment agreement for restrictions - ☐ Check non-compete scope and geography - ☐ Confirm no IP assignment conflicts - ☐ Use personal devices/time only - ☐ Avoid competing with employer directly - ☐ Consider disclosure to employer if required ## Related Articles - [Choosing the Right Attorney for Your Business](/blog/choosing-right-attorney) - [The Role of Legal Tech in Modern Law Firms](/blog/legal-tech-modern-law-firms) - [Professional Trademark Strategy](/blog/professional-trademark-strategy) [Learn more about our Outside Counsel practice →](/services/outside-counsel) How Jacobs Counsel helps Jacobs Counsel provides outside general counsel and fractional legal support for growing companies, startups, AI businesses, creators, sports and entertainment ventures, brands, and business owners that need practical legal judgment without building a full in-house legal department. [Explore outside counsel](/services/outside-counsel) **Legal Disclaimer:** This article is for general informational purposes only and does not constitute legal advice. Reading this article does not create an attorney-client relationship. Laws vary by jurisdiction and may change over time. You should consult counsel about your specific facts before making legal or business decisions. [![Drew Jacobs — Founder & Managing Attorney, Jacobs Counsel LLC](/assets/drew-jacobs-headshot-416-BLqfQvVH.webp)](/about/drew-jacobs) About the Author [Andrew R. Jacobs, Esq.](/about/drew-jacobs) Founder & Managing Attorney at Jacobs Counsel LLC. Director of Sports, Entertainment & Gaming Initiatives at Seton Hall Law. Super Lawyers Rising Star 2026. Licensed in NY, NJ & OH. [Read full bio →](/about/drew-jacobs) Related on Outside Counsel for AI Startups & SaaS ## Cornerstone guides and services [ In-Depth Guide ### Fractional GC for AI Startups How embedded, ongoing outside counsel works for AI-native and high-growth startups. Read: Fractional GC for AI Startups ](/fractional-general-counsel-ai-startups)[ Related Guide ### Subscription Legal Service for AI Startups A buyer's guide to evaluating subscription-style legal arrangements — not an offer of named tiers. Read: Subscription Legal Service for AI Startups ](/subscription-legal-service-ai-startups-guide)[ Service & Pricing ### Outside Counsel Services Ongoing outside counsel billed hourly, on a monthly retainer, or hybrid — with fixed fees for defined projects. Read: Outside Counsel Services ](/services/outside-counsel) You might also like [ Fractional General Counsel: Legal Support for Startups As a startup founder, you wear many hats: CEO, product manager, salesperson, and head of HR. ](/blog/fractional-general-counsel-2025)[ How Much Does Outside Counsel Cost? Hourly, Retainer, Fixed-Fee, and Hybrid Models Companies usually ask "How much does outside counsel cost?" after legal work has become too frequent for one-off projects but before a full-time legal hire… ](/blog/flat-fee-vs-hourly-attorney) ## Related Articles [Outside Counsel ### Fractional General Counsel: Practical Legal Support for Growing Companies What fractional general counsel actually is, what it is not, and when it make… ](/blog/fractional-general-counsel-2025)[NIL & Athlete Deals ### What Changed for NIL Deals and Collectives in 2026? A practical look at the 2026 NIL landscape: the House settlement, the Protect… ](/blog/what-changed-for-nil-deals-and-collectives-in-2026)[Gaming & Compliance ### What the 2026 PA Skill Games Ruling Means for Operators Pennsylvania's Supreme Court held skill games are illegal slot machines, with… ](/blog/pennsylvania-supreme-court-skill-games-ruling-2026) ## Keep Learning More insights on Outside Counsel legal strategies 🚀 ### The Startup Legal Playbook Compare legal support models and prepare your growing company for contracts, funding and recurring legal work. \+ Add your name (optional) Get the guide, CourtVision Weekly newsletter, and a short series of related follow-up emails. Unsubscribe anytime. Download Free Guide Instant download. Unsubscribe anytime. [ Outside Counsel • 10 min read ### Fractional General Counsel: Legal Support for Startups As a startup founder, you wear many hats: CEO, product manager, salesperson, and head of HR. October 22, 2025 Read ](/blog/fractional-general-counsel-2025)[ Outside Counsel • 9 min read ### How Much Does Outside Counsel Cost? Hourly, Retainer, Fixed-Fee, and Hybrid Models Companies usually ask "How much does outside counsel cost?" after legal work has become too frequent for one-off projects but before a full-time legal hire… April 8, 2026 Read ](/blog/flat-fee-vs-hourly-attorney) ### Enjoyed this article? Get weekly legal insights delivered straight to your inbox. We keep it brief and useful. Subscribe [About Court Vision Weekly](/court-vision-weekly) ### Need Legal Support? We help high-performing creators, athletes, and founders protect their brands and build sustainable businesses. BOOK STRATEGY CALL →[VIEW ALL RESOURCES](/resources) ### Book a 15-Minute Case Assessment Start with a Complimentary Fit & Intake Call with Jamee, or book a paid strategy session with Drew. Book a 15-Minute Case Assessment * * * #### Free Resources [Download: Deal Review Checklist](/resources/deal-support) * * * ⭐ Super Lawyers Rising Star 2026 [![Jacobs Counsel LLC](/assets/logo-footer-N09_u2vs.png)](/) Outside counsel for companies across industries, with deeper experience in gaming and esports, AI and startups, sports and NIL, creators, and hospitality. ## Choose how you’d like to start Begin with a complimentary fit-and-intake call with Jamee, or book a paid legal strategy session with Drew. [View Call Options](/book-consultation)[Start a Matter](/intake) ### Contact - [(646) 343-7227](tel:+16463437227) - [intake@jacobscounsellaw.com](mailto:intake@jacobscounsellaw.com) - [New York: 135 Madison Ave., Floor 4, New York, NY 10016](/locations/new-york) - [New Jersey: 221 River Street, Floor 9, Hoboken, NJ 07030](/locations/new-jersey) - [Ohio: 127 Willow Ave., Floor 2, Cincinnati, OH 45215](/locations/ohio) ### Practice - [Outside Counsel for Companies](/services/outside-counsel) - [Gaming](/services/gaming-law) - [Athletes & Talent](/clients/athletes) - [How We Work](/how-we-work) - [Legacy Counsel by Jacobs Counsel](https://jacobslegacycounsel.com) ### Insights - [Blog](/blog) - [Answers](/answers) - [Deal Anatomy](/deal-anatomy) - [Compare](/compare) - [Guides](/resources) - [Court Vision Weekly](/court-vision-weekly) ### Firm - [About the Firm](/about) - [Drew Jacobs](/about/drew-jacobs) - [Testimonials](/testimonials) - [Media](/media) - [Contact](/contact) - [Locations](/locations) ### Court Vision Weekly Five stories, five minutes, once a month. Legal insights for athletes, creators, founders, and gaming operators. [View archive](/court-vision-weekly) Subscribe Get CourtVision Weekly and a short welcome series from Jacobs Counsel. Unsubscribe anytime. Jacobs Counsel LLC. Andrew R. Jacobs is admitted to practice in New York, New Jersey and Ohio. Andrew R. Jacobs is the responsible lawyer for this website. Matters in other jurisdictions are considered only where permitted and may require local counsel or separate admission. This website is Attorney Advertising. The information here is general in nature and is not legal advice. Contacting us does not create an attorney-client relationship, and no such relationship exists until the firm and client sign a written engagement agreement. We do not monitor or protect any filing, appeal, waiver or other deadline unless and until a signed engagement agreement says we do, and no result is guaranteed. © 2026 Jacobs Counsel LLC. All rights reserved. [Privacy](/legal/privacy-policy)[Terms](/legal/terms)[Attorney Advertising](/legal/attorney-advertising)[Disclaimer](/legal/disclaimer)[Accessibility](/legal/accessibility)[Site Index](/sitemap)