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I live in Texas. Our labor laws are some of the worst. However, even here I think a blanket clause from a startup that prohibits outside employment sounds fishy. Researching this I found the Texas Guidebook for Employees which has this to say in Conflict of Interest,

It is generally inadvisable to flatly prohibit all outside employment. Many people work two or three jobs. The real concern should be with outside work that interferes with the employee's ability to be a good employee for the employer. For example, an employer may legally prohibit any outside work for a competitor of the company; that conflicts with the working hours for the company; that undercuts the company's image, mission, or goals; or that makes the employee so tired that the employee cannot function effectively in the job he or she performs for the company.

That's not very good guidance though. When it says it's "generally inadvisable", what's the reading of that? Does that mean the court will enforce it if it is written that way, and that this Guidebook amounts to mere morality training for employeers?

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    If you're going to vote-to-close please, tell me the reasoning behind the vote. I have no idea what details I lack in this. Jun 21 at 23:34
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    I do not see that any "details or clarity" is lacking here. Jun 22 at 2:19
  • I think this greatly depends on the expected work hours for your "primary" job. If you are employed 100% (5 days per week), it's probably fine to deny another job (as you would be tired in the moring), but if you are only employed 40% (2 days), that argument won't hold.
    – PMF
    Jun 22 at 7:42
  • @PMF are you saying the burden is on them to prove it will interfere with work for it to be enforceable? Jun 22 at 7:51
  • Yes, I would say that if a court would need to decide, that's what they would base their decision on. That's also what your quote is about: Different ways how two jobs could interfere.
    – PMF
    Jun 22 at 7:57

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Most states don't expressly prohibit this, and there are some jobs where this is legitimately required.

On the other hand, this prohibition will generally not be implied in the absence of a clear agreement on the subject, as this is rarely the contractual understanding. It could also be struck down in a common law public policy limitation on contracts if it serves no legitimate purpose and amounts to a punitive penalty.

Also, under the Federal Fair Labor Standards Act (FLSA), you must be paid for time spent working unless you qualify to be a salaried worker, and such a requirement arguably triggers minimum wage and overtime requirements for time when you are available (although the regulations are quite involved on this kind of situation).

Colorado has a rare outlier statute protecting the right to engage in lawful away from work activity (originally enacted to protect smokers but much broader in application).

A small number of U.S. jurisdictions have or are considering adopting, limitations on "on call" time when not actually working. But, the prohibition on outside work could have other aspects to it (e.g. avoiding conflicts of interest, or complying with regulatory rest time requirements).

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  • So generally for salaried W-2 work, except for Colorado, you're employer can make it such that you can't work any other jobs? Jun 21 at 22:56
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    @EvanCarroll It is not at all uncommon for a senior executive or professional with a rare individualized employment contract to have an "all of your efforts" clause that means, for example, that a CEO or lobbyist must devote all of their work efforts to working for a firm that employs them, often in a context where actual effort in a 24/7 job is hard to quantify and the best an employer can do is forbid competition with the job someone is hired and well-paid for.
    – ohwilleke
    Jun 21 at 23:02
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    Your comments better address the question then your answer itself. =) Thanks again. That's exactly what I'm looking for. Jun 21 at 23:45

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