

Employees working on their own business - mattjung
http://discuss.joelonsoftware.com/default.asp?biz.5.728913

======
lgriffith
I practically rewrote every IP "agreement" for nearly every job I had since I
started working in industry (ca. 1965). The terms were more or less as
follows.

1\. I am in the business of invention. I invent many things. I cannot possibly
disclose all of them. Hence, ANYTHING I have done in the past is excluded and
ANYTHING I will do after I leave your employ is excluded without having to be
disclosed. This is true even if the thing invented can be construed to be
directly or indirectly connected to your business. The only exception to this
will be those things directly and explicitly connected to your IP disclosed to
me during my employ for a period not to exceed two years after my departure
for un-registered un-patented IP. Normal patent and copyright laws apply -
BOTH ways.

2\. What I do 0n your time with your equipment on projects specifically
assigned to me is yours.

3\. What I do on my time with my equipment on my self assigned projects
distinct from yours is mine.

4\. Since my business is invention, if the invention was concieved on your
premises but is not DIRECTLY connected to your business, your disclosed IP,
and your assigned project, the invention is mine. This will be true even if
the invention is used to indirectly support project. In that case, a non-
exclusive license to use will be granted by me to you but I still own the
resultant IP.

Almost without exception, the terms were accepted. Where there was substantial
disagreement, I looked for another job/contract.

~~~
ph0rque
Comments like these make me wish there was a "bookmark comment for future
reference" feature on HN.

~~~
thedob
Click 'link', then 'Save to Delicious'. Problem solved.

~~~
zurla
or better yet, clip to evernote

~~~
xiaoma
or drop the URL into your Supermemo flashcard schedule

------
geebee
I do completely understand why an employer would own the employee's work if it
is related to the job and was completed using the employer's equipment... but
it still worries me, as a developer, and as a consumer.

I figure the public has an interest in promoting as much innovation as
possible. This means that we want employers to be able to hire employees to
work on innovative projects, but we don't want to discourage employees from
working on projects on their own either. So if this relationship gets out of
balance, we could end up stifling innovation from one side of the
relationship.

Think of it this way... suppose I'm a house flipper. I mainly do this on my
own time, but I do search the web for properties, email friends about
investment opportunities, and call mortgage brokers while I'm at work. It's
not a huge time sink, probably no worse than the random goofing off or reading
hacker news that goes on at work.

I doubt a court would allow my employer to "own" my profits from flipping
houses.

Now say I have a side programming project. I mainly do this at home on my
computer, but occasionally I think about it at work, and I have fixed bugs,
sketched out an algorithm, or tested the site at work, and I did write a bit
of code on my work supplied computer.

In this case, I suspect the courts (IANAL, of course!) would award ownership
to my employer, even if the project is unrelated to my work tasks.

So basically, the law does encourage programmers to start side businesses in
areas unrelated to technology... but don't we want programmers to innovate in
their field of expertise? Personally, I'd much rather see programmers writing
innovative applications than flipping houses.

I don't have an easy answer for it, because like I said earlier, I also do see
a clear need to provide IP ownership for investors employers who are paying
employees to innovate. But I'd draw this line more narrowly - no big surprise,
since I am a programmer "employee" myself, and these rules would favor me.

------
doki_pen
Judge him only on his performance. If you can't do that then you are a bad
employer. His work performance is what you pay for. It's up to him to make
sure he delivers on that promise.

~~~
ntoshev
Measuring performance of programmers (or knowledge workers in general) is an
unsolved problem.

~~~
mightybyte
Objective, concrete, quantifiable metrics are the unsolved problem. Every one
that I've ever heard of can be gamed by the developer. The only exception to
this that I can think of is the metric of product success in the market. But
it's too large-scale to be useful in measuring individual employees.

Subjective metrics are quite common and effective. That's how good programmers
such as <insert favorite hacker hero here> are regarded as good.

~~~
ntoshev
Subjective metrics include observation over a long period of time. It may be
months before you are sure someone good is underperforming.

------
lsc
The employee running his own business is going to be somewhat distracted, just
like an employee with a family or kids. It's something else that is more
important than his job. The thing is, an employees interests don't exactly
align with the business owners interests. As a business owner, almost
everything I do is focused on growing that business. The closest you can come
to that in an employee, really, is a single person who is really into
programming. these people will have hobby projects, but that's ok, especially
if they can be things kindof related to technologies your business uses. Like
the SysAdmin who writes apache modules.

That said, you don't always just fire people when they get married. the
question, simply, is 'Is the employee, with all his or her distractions, still
worth his or her salary?' - Most of us are unwilling to remain single and
completely dedicated to our jobs for our whole life. Right now, for instance,
if you want to hire me, you have to put up with my business being my primary
focus, otherwise I won't work for you. (but then I'm a contractor, so that's
not unexpected.) And just imagine the outcry if you acted against people who
valued their family over your business.

------
mdasen
My gut reaction would be to just let it be. Telling him that he can't sell it
will lower his morale and possibly hasten his departure for a firm that
doesn't mind (or for the project itself should the income prove to be at least
enough to live off).

Does the item have value? He might be interested in selling it to you. If an
employee likes his employer, they won't mind giving you their work for a
little bit of money. You can always branch out into new areas.

Unless you're willing to make the employee a partner at your firm, I don't
think there's much you can do that wouldn't seem "evil" and you don't seem
like the evil boss type. If they're a partner at your firm, they get to direct
the firm to an extent and share in its profits. If they're just a wage
laborer, they will leave when something better comes along and that's one of
the costs an employer must beat - and similarly the employee must bear that
they cannot be paid the full value of their output as a wage laborer.

I'd say just let it be. Most web applications don't go anywhere. Be supportive
and happy for him. In the case that it fails (or makes a few hundred dollars a
month), he won't be leaving you and you'll come off as the awesome boss who is
supportive of personal growth and chill with stuff. And that will make him
stay even longer.

------
puzzle-out
He's doing it in his own time - end of. If he's really that good then I would
invest in his idea. If he is losing focus then kick him out. There's no
absolutes here, just depends on how he works.

~~~
JabavuAdams
Investment implies (part) ownership. So, you're back to figuring out who owns
what.

------
josefresco
"But obviously, there are a lot of issues involved."

The issue here is that you have an employee that's passionate about what they
do (shocker I know). A trait that's rare and should cause you concern only
because there's a good chance this developer will jump ship to pursue their
passion full time on their own.

I'd try to keep them employed (for you) as long as you can by encouraging this
'free time' project which will hopefully also influence your other developers
to take up their own pet projects.

It's not the project that is of value, it's the engagement of the mind that
benefits you and the work they create for you.

------
okeumeni
I started working on my own stuff to keep on with technology and bring some
fun into my life. I never stopped working on a side project; I do not mix my
time at work (at my employer) and my side business. Today as a full time
consultant I found it even easier to equally use my time at both my startup
and my clients.

------
blurry
Am I the only one who's read the original issue as not the problem with
extracurricular activities per say, but the fact that the employee now wants
to sell one of those apps?

The employer said:

 _One of my employees is always working in small applications for his family
or just for the fun of it. Now he wants to start selling one of those
applications._

... and

 _I think that anyone can do what he wishes with his own time. But obviously,
there are a lot of issues involved._

The way I read it, he's known about the side projects for a while and never
had a problem with them. He is having second thoughts only because he's
learned that the coder wants to make money off one of those projects...

I think that what's really happening here is the employer having a personal
bias of the money-is-dirty variety. Obviously, anyone is welcome to whatever
moral attitudes they like, but to force them onto your employees is completely
inappropriate.

------
known
Since 1993 there were number of Anonymous authors in Linux Kernel
<http://lxr.linux.no/linux-old+v1.0/net/inet/sock.c#L50>

------
pclark
don't see what the issue is.

~~~
c1sc0
The issue is that coders can only load so much code into their brain at once.
There's a huge switching cost involved in going from 'own-app' to 'company-
app'. You are simply not as productive when working 2 significant projects at
the same time.

~~~
pclark
you're also not as productive if you play video games all night, or if you go
drinking, or if you ...

~~~
tom_rath
Games, drinks, children, etc. are diversions from the activities of software
development and business which the employer is paying you to engage in on
their behalf.

Participating in them outside of office hours would tend to _increase_ your
productivity at work by giving your head a rest.

~~~
brandon272
mmm... nope.

Our most productive employees are the ones without kids, families or bustling
social lives. And those same employees are the ones who are working on "side"
projects while they are also working for us.

Any company that would tell an employee that they can't work on a side
project, either as a business or a hobby that is not in direct competition
with that company is setting itself up for failure because it's a sign of a
larger cultural issue within the company itself, stemming from severe
mismanagement.

~~~
tom_rath
"Side projects" and open-source projects are great for self-education. I've
nothing but good things to say about them for employee improvement.

Running a separate business is a different story altogether. Do you really
have productive employees who are operating software development companies on
the side? If you do, I can guarantee their primary attention does not lie with
you (even though their primary income is being paid by you).

~~~
lsc
This, I think, is the key distinction. Running a business is a whole lot of
work, and much of that work does not make your guy a better software
developer. Running a side business is probably going to diminish a programmers
productivity.

Writing an application (and ignoring the business and customer service side of
things) likely will make your programmer more productive, 'cause he learns all
this new stuff.

------
tom_rath
This can be really nasty for a small business. On the one hand, you understand
the desire to build a seed for a software company, on the other you're
dedicating scarce resources to pay this employee to work exclusively for you.

I'd tend towards overly-harsh on this one: You're either an employee or an
entrepreneur. The choice is binary. We'd love to have you as an employee, but
a person building their own business and riding on the salary we (a small
business ourselves) pay while they do it is not welcome.

Every employer I had before heading off and starting my own company had an
air-tight IP policy which basically owned my software-developing ass. That
makes sense: You're either an employee or an owner, you don't mix the two.

~~~
ryanwaggoner
_you're dedicating scarce resources to pay this employee to work exclusively
for you_

Bull-fucking-shit. I don't understand the mentality that because someone pays
me for 40+ hours of work per week, they think they own me and can demand that
I work _exclusively_ for them, or that anything I do in my own time belongs to
them. If my work suffers, or if I'm stealing IP or clients, that's another
story. But if I'm working on something in my own time, fuck you if you think
you own it.

~~~
tom_rath
As I mentioned in replies to your other comments above, running a business
requires your full attention. It's not a hobby. It's not a side-project. It's
a way of life.

You cannot work for another person while running your own business. A business
becomes the centre of a person's universe and an employee's work will suffer
if they are building a genuine business on the side. No amount of dramatic
profanity will change that reality.

Of all the vigorous down-mods and "you're wrong!" comments I've received here
in response, I've yet to read a single real-world example of a person who has
a full-time employee on staff working on their own business, or who is a full-
time employee working on their own business while being paid a salary by
another company.

Why? Because you're an employee or you're an entrepreneur. Those are not
compatible mind-sets.

If you work for me and want to start your own company, great! I'll happily
send you on your way and offer every bit of support I possibly can to ensure
your success, but I won't pay you to build your own business.

~~~
HeyLaughingBoy
_I've yet to read a single real-world example of a person who has a full-time
employee on staff working on their own business_

That they know of! It's not exactly the kind of thing most sensible people
would draw attention to.

~~~
tom_rath
Well, gee, if it's so awesome to empower one's staff to start their own
business while working on your payroll, I'd expect employers of software
developers would be trumpeting their fine examples from the hills to attract
the best staff possible!

Why the silence? Because starting a business while working full-time for
another employer does not work, and any person who has started their own
software development company would understand why.

------
quellhorst
I like to turn projects I am working on for clients into services I sell to
new clients. It seems to work ok. My clients get better quality and I get more
income without extra hourly work.

------
rokhayakebe
Ask him what would he do if he was in your position.

