Whether you’re trying to launch your own business in your spare time or just trying to cope with rising prices, a side gig can give you both opportunities and extra income. What happens, however, if your employer discovers your second job and takes exception?
Can they force you to stop? Can they fire you for it?
Colorado offers unique protections for employees
Under Colorado Revised Statutes § 24-34-402.5, employers generally cannot fire employees simply for engaging in lawful activities outside work. However, this protection has exceptions, especially when a side business creates a conflict of interest or interferes with the employee’s professional obligations. This protection usually even extends to employees who freelance, operate small businesses or work second jobs.
The protections for side gigs are not absolute
The law does not prevent employers from enforcing legitimate restrictions on outside work to protect against conflicts of interest or preserve certain occupational requirements. Depending on the situation, an employer might be able to legally object if an employee:
- Works for a direct competitor in a position that creates conflicting responsibilities
- Uses company equipment, confidential information or trade secrets for an outside business
- Solicits the employer’s customers, clients and suppliers for a competing venture
- Allows their outside work to interfere with their essential job responsibilities
For example, a software developer who spends evenings creating an unrelated mobile game may be in a protected position, unlike an employee who is trying to launch an online platform that directly competes with their employer’s product
What about non-compete agreements?
Colorado prohibits non-compete agreements, subject to limited exceptions. Certain agreements involving highly compensated employees may be enforceable when they meet statutory requirements and are reasonably necessary to protect trade secrets.
However, an employer cannot automatically prevent someone from accepting additional work simply because their employment contract contains a non-compete clause. The agreement must comply with Colorado law.
What if you’re fired for having a side gig?
If your employer terminates you solely because of lawful outside employment, you may have grounds for a wrongful termination claim. Before resigning or abandoning that other source of income, consider having an employment attorney review your situation.