Conflict of Interest for Private Consulting While Working at Company in Same Industry?

Question

I have plans to branch out into private consulting in the field I am currently employed in. Several exisiting clients have approached me expressing strong interest in working with me privately, based on the help I have been able to provide ... especially when concerned they have not received the same level of service from their assigned resources. As this area of consulting could (and often does) take place in the evenings and weekends, and to be open and fair, I previously approached the head of my division to discuss the option of providing this service to those dissatisfied clients - offering to do so after normal business hours. The response I received was that to do so would give my employers ammunition to fire me. I have worked here 12 years and have witnessed the evidence of the spiteful nature of my employers: black-listed in company and surrounding community; refusal to provide recommendations; delay or "creative processing" of exit pay, etc. However, there are several people at our company who have private businesses in the specific field they are working in.

I've considered restricting my consulting practice to those clients who can show they have no active business with the company where I work. Again, this consulting would take place outside my current work hours. I see this as a way around the "conflict of interest" issue, but am fearful my employers would still use this against me. Is this a subjective matter that can be handled according to the discretion of employers, or is there a legal line drawn here? What legal standing do I have in this situation?

Answer 1

I don't think anyone can provide you with specific information without knowing your jurisdiction and, importantly, your employment contract.

From what you have written, it would seem entirely reasonable for the company to fire you - As you describe it (although, I think, not as you see it) you could be seen as directly competing with them - ie biting the hand that feeds you. (The question of how hard it would be to fire you would be dependent on where you are). Also, you might or might not have issues with restraint of trade - if your contract talks about one - as you are targetting customers who are doing business with your current employer.

Its probably a very long shot, but could you broach the possibility of switching from an employee at your current position to one of a contractor ? If your company is receptive to the concept, you could sell it to them by negotiating terms of who you will not work for, or maybe giving them a cut of the money you receive from there ex-clients ?