How to handle agency employee side hustles

It is not uncommon for agency employees to want to do a bit of freelancing on the side. Some even have dreams of starting their own agency or other business.

How do you protect your agency’s interest while not stifling your employee’s ambition? What should you do when an employee comes to you to share what they’re doing or considering? How about the times when you discover what they’re up to and they never disclosed?

Chip and Gini cover these questions and more in this episode of the Agency Leadership Podcast.

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin 

Hello, and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin,

Gini Dietrich 

and I’m Gini Dietrich,

Chip Griffin 

and Gini. I have this idea for another podcast. I think I’m going to work on it over the next 20 minutes. Is that all right with you? That

Gini Dietrich 

sounds great.

Chip Griffin 

Excellent. right after this.

Gini Dietrich 

So before we start, I have to ask you was it Jen who found the still have me rolling my eyes at you? Because it was kind of amazing.

Chip Griffin 

I know that was that was all me. I handle all the video editing and that kind of stuff. Yes. Well, I thought it was I thought this we’re talking about the thumbnail for as we’re recording this the most recently published episode of the podcast, and I do try to have some fun with the thumbnails. And I’ve, I’ve tried to give myself as many funny looks as Jenny. But unfortunately, that one,

Gini Dietrich 

though, is it should be our it should go on the homepage, because it’s pretty indicative of how things go here.

Chip Griffin 

Yes, yes. I mean, it’s shocking.

Gini Dietrich 

I roll my eyes.

Chip Griffin 

Right? That’s how I captioned it. You know? Is she rolling her eyes up the idea? Or what I said, or just at me, generally, you have no idea. But it’s a good default look. So anyway, we’re going to go to one of your favorite eye rolling places today, Jenny? Oh, yes, I love I love the Reddit, we’re going to the well of all knowledge, and accuracy, Reddit agency subreddit. And today, we have an agency employee who is asking a question, and he or she writes, hey, all I work at an agency under a holding company, and we are asked to report outside business, I have a business idea I want to pursue and would honestly be useful as an internal platform, as part of me wants to approach leadership and report it asked permission to pitch internally for support. But I’m a bit scared, I guess I’ve had bad experiences. And then he asked, Does anyone else have an experience or advice? And you know, if you’ve got your own idea, what should you do? So this is this is, I think, a good topic because our listeners may be approaching this from either angle, there are some of you who are listening, maybe you’re thinking about starting your own agency, maybe you’re doing a little freelance work on the side, while you’re working for a larger agency. And so you’re wondering how to handle that. Or if you own your own agency already, you may be thinking about how to handle employees who are either already doing this, or how to protect yourself in the event that they do in the future.

Gini Dietrich 

Yeah, you know, we, I actually believe in allowing people to do what they want on their own time. And so in our contracts, and one of the conversations we have in the interview process is, hey, listen, if you want to do freelance work on the side, that’s fine. It just can’t compete with any of our clients. And it can’t be work that would compete with us as an agency. And we are pretty clear about what that what that looks like. And we talk it through and then it’s also in the contract. So I know that we’re not, we’re a little more lenient when it comes to that than most agencies, but you know, if someone wants, wants to write a book about PR on their own time, okay, great. Leo, I’m happy to provide a review for you, you know, those kinds of things, I think, should be talked through. When I when I read this at first, though, and I read the comments that said that pretty much they don’t say anything. I was like, you know, when you work for a holding company, that’s a little scary, because it’s not just Gini Dietrich who’s like, yeah, that sounds great. Or no, you can’t do that. And here’s why. Right? It’s it’s a little bit different. But I think there’s a bigger issue at play here, which is, what does your employment contracts, and from an agency owner perspective, what’s in your employment contracts that do that allow or prevent employees from doing these kinds of things?

Chip Griffin 

Right. And I think that, you know, my philosophy is very similar to yours. I’m very much of the mindset that as long as you’re not doing anything that’s going to directly harm my business, I want you to have the freedom to things and explore things, and all that. So I’ve got no issue with that. However, I do have an issue, if you’re going to be doing freelance work for someone that might be a good fit for my agency. Right? So if it’s the same client or type of client that I’m pursuing as an agency, no, I don’t want you working for them. But you know, if I serve as you know, folks for public affairs, and you want to do freelancing for some local charity, cool, great, you know, that’s, I’ve got no issue with that, because there’s clearly no competition to be had there. And as long as you’re getting your job done, well for me, you know, more power to you.

Gini Dietrich 

Yeah, and I think the other thing you should be thinking about and this is something that I ran into when I left my my agency job to start my own, is you can, you can say clients with you. So don’t be soliciting our clients, you know, and make sure that that’s clear in the employment contracts too, because most most of your employees will leave If they leave to start their own something, it will be to start an agency most most, there are going to be some that have a tech idea, a software idea, but most people will leave to start an agency. So you got to protect yourself from that perspective as well.

Chip Griffin 

Right. And so you know, one of the things that you want to make sure that you’re having your new employees do is sign non solicitation agreements, that’s, that is probably the most important document non competes are pretty much pointless these days, most states don’t let you enforce them. And they’re very difficult to enforce. But non solicitation is pretty straightforward to enforce. And I’m not aware of any states or countries that prohibit those kinds of agreements. So certainly make sure that you have those in place. And actually, we have a relatively recent episode of the small agency talk show where Sharon Toerek, and I discuss some of these agreements for employees and and what you should or should not do. So I would encourage you to go listen to that. And if I’m smart enough, I’ll you’ll link to. Yeah, if I’m smart enough, so just go to small agency TV, and you can find it there. That’s probably the safer bet.

Gini Dietrich 

Yeah. Because you probably forget,

Chip Griffin 

yes. But I do like listening to my voice. So maybe I will hear myself saying this in the future and go back and add it.

Gini Dietrich 

Add it later.

Chip Griffin 

Anytime, yeah. But so do make sure you do that. And, and so. But if you’re, if you’re doing something on your own, if you’re working for a larger agency, and you’re thinking about starting your own business, there are some key things that you need to be thinking about to protect yourself. And so some of those things are, make sure that you’re not using any agency resource for any of these outside business ideas. So that means that if you are working on your own side hustle, you should really be using a separate computer, a separate phone, certainly a separate email address, particularly the email address, because you know, your employer can look at that, right. And I cannot tell you the number of times over the years that I’ve had people doing side hustle type things that they shouldn’t that end up getting caught because they put it on a company email. And so you can just search for that and find it very easily, folks, so but don’t use any company resource, because if you’re using a company resource, then they and by extension, their lawyers can claim that it’s actually something they own. And this is even more important if you’re building a website or an idea or software or something like that. That’s not just an agency business.

Gini Dietrich 

Yeah, I think that’s a really good thing to remember, I have a really good girlfriend. This is not funny. It’s funny, but it’s not funny. Then this was 10 years ago, she emailed me about how angry she was at her boss. And he just stupidly, so he was he was being terrible. But she just let it all out on company email, and they read it. And they fired her. And she was like, what, and I was like we can’t, first of all, you shouldn’t have put that in writing. And second of all, you shouldn’t have send it on company email. But even more, even if you’re using your personal email address, still don’t use the company, computer. And still don’t use the company phone company paid for phone. Because even if it’s your personal, they can still access that too. So I would say if you’re doing any sort of side hustle, and you’ve gotten approval for it, keep it all separate, separate email, separate phones, separate everything, separate Slack, separate, texting, all of that kind of stuff, and just protect yourself so that you have the firewall in between the two.

Chip Griffin 

Yeah, and I will tell you the first termination I ever had in a business that I was running was for someone who was using company resources to freelance for a business that could have been a competitor, or could have been a good client for our business. And, and it was someone who we had discovered it previously, through email, we had warned that employee, they continued anyway,

Gini Dietrich 

that kind of you does kind of deserve to be fired at that point

Chip Griffin 

nice and cut and dried on something like that. But I’ve had, I’ve had numerous instances over the years where I have had either my own employees or clients employees who were doing that kind of thing. So it is it is not uncommon for people to be doing this kind of freelance work. And, and frankly, most people just end up using what resources they have in front of them, which is probably their company laptop, right? Most people don’t have their own computer these days. But if you’re going to be starting your own business, you need to have your own you’re going to need it anyway. Because you know, you’re not going to be able to keep using your your employer’s equipment after you leave. So make sure that you’ve got it set up this way so that you’re not running into problems down the road. And I will tell you, it typically only becomes a problem when you start to be successful. right because your employer doesn’t care about you. If you’re not if you’re if your idea for a new product or service. is not getting off the ground, if your agency is not getting off the ground, they don’t care. They’re not going to pursue, they’re going to pursue you when you start to do well. And that’s when it’s really going to hurt. Yeah. And they can come at you Well, after the fact, if they discover that, you know, let’s say you, you build the next Google on their equipment, right? They will come and take it from you.

Gini Dietrich 

Yes, they will. And you do not want that to happen. So do not

Chip Griffin 

want that to happen. And while it can feel good to sort of stick it to the big holding company, man, they’re also the ones who have the most lawyers.

Gini Dietrich 

So most money, yeah, they will come get

Chip Griffin 

you. And they sometimes like to just make a point. And I know that you like to make a point.

Gini Dietrich 

Very much. So I very much like to spend my money to make a point. I do.

Chip Griffin 

But so so so I mean, let’s say that I’m a small agency owner, how do I protect me? Obviously, we’ve talked about, you know, you want to make sure you have the proper legal agreements in place. But how do you make sure that you’re creating an environment that you know, whether you’re as permissive as you and I are as far as allowing people to have side hustles? Or not? How do you sort of handle it from a management perspective, to make sure that that you’re not having your own team? Go down paths you don’t want them on?

Gini Dietrich 

I mean, it’s really a cultural thing, right? I mean, if you have a, if you have an open and authentic and trustworthy culture, where people feel comfortable, they’re not, what do they say, I’m a bit scared, they they may be, they may be nervous, because, you know, it’s probably something that you don’t want to have to bring up to your boss. But if you’ve created a culture that that allows for that kind of thing, I think it’s completely different than one that like, we have a client that they their culture is who it’s a little messy, and it’s not, they’ve not created an opportunity to empower employees and build trust. And because of that, I can see that some employees would want to stick it to the man in some cases. But I think and certainly I’m, I’m not perfect, and I’ve made mistakes. But I think from our perspective, we’ve, we lay out the expectations in the interview process. We repeat them again, in the onboarding process. And then we have conversations about it. I mean, we’re pretty open about, you know, one of my former colleagues started a bakery shipping company, while she worked here, and she came to me and said, Hey, I’m going to do this, I’d like to do this. Is that okay with you? And I was like, yeah, go do it, as long as it doesn’t interfere with your job. Absolutely. And because of that, we had conversations in team meetings about it, like she’s doing this, and you guys should support her and those kinds of things. And so that creates a culture where if somebody has the side hustle, they feel comfortable bringing it up. Now, like you said, if it was something that was good for the, for our, for my business, or it competed with one of our clients, I would tell them, no, and they would have to make a decision. But for the most part, it’s it’s things that don’t, that don’t have anything to do with, you know, it’s just, it’s a side hustle, because it’s a passion, not because they’re trying to do 24 hours of PR.

Chip Griffin 

Right, right. And I love that you say it’s about culture and creating that environment, right? Because, you know, you can deal with a lot of this through legal documents, but a good piece of it is making sure that you’re clear about what your expectations are. So if you’re permissive like us, that’s great. make that clear, helps them to understand that you’re cool with it, as long as it lives within these parameters. If you’re if you take a harder line, and you’re like, No, I just, you know, I don’t believe that you should be doing anything in this same sphere for which I’m paying you for because I don’t know what, what we might get into in the future or whatever. That’s okay, too. You just need to be clear about that. So that there aren’t misunderstandings. And, and this is one of those places where your employee handbook is your friend, your employee handbook, should be very clear about what needs to be reported and what doesn’t. And so some agencies will have a handbook that says, You need to report any outside employment. And and it doesn’t necessarily say that you can’t do it, but that it needs to be reported. So that there’s that opportunity for us to say, okay, no, I know you don’t think that this is a conflict, but it is, and here’s why. And then, of course, you need to treat folks fairly if they do, right, because you don’t want to create an environment people are afraid is this individualism, this Reddit post to report it? Because they’re afraid you may shut them down? arbitrarily, right? Right. You want to make sure that if you’re going to shut someone down on something like that, there is a reason for it. And and if you do that, then then word will get around amongst your team. And if you’re a small agency, your whole team talks to everybody else anyway. Right? There are no real secrets. And so you’re better off to be in a position where they understand where you’re coming from and how you’re going to approach it so that there are no nasty surprises for either party down the road.

Gini Dietrich 

You know, I will tell you and I’m just remembering this now I worked for a large agency that had a holding company, and I very much loved to work for William Sonoma during the holidays because I got discounts and free stuff and I I had to report that and the first year that I did it, they had no problem with it. The second year I did it, they were like, this is kind of interfering with travel and your ability to be on the road. And the third year, they were like, you can’t do this anymore. That kind of sucks, because I didn’t get my free William Sonoma anymore. But they I mean, they, they put the hammer down, and they said, Listen, if you want to keep doing this, you can do it full time. You can’t do it while you work here. And I was like, Okay, I don’t want to do it full time.

Chip Griffin 

Right? Well, and that’s why it’s, it’s important for, for you to be clear as an owner. And to be clear, as an employee, that whatever you’re doing on the outside simply can’t interfere with your main job, right. And so you as an employee should not expect that, that you should be able to say no to a business trip, because you’re doing something on the side, unless you’ve already created that, that expectation with your employer, don’t expect that they’re gonna say, Sure, you don’t have to go on this business trip, you don’t have to be on this call, because I understand that you’re doing some freelancing, or you’re driving for Uber, or working for William Sonoma, or whatever. So you know, and I know that there are some folks who believe that you know, that, not only should they be able to do their side hustle, but they should be able to decide for themselves how they’re going to manage that versus their main job. And that’s simply not true, your main job has to take priority.

Gini Dietrich 

Yeah. And that that was a hard lesson for you know, me as a 24 year old to learn Sure, I kind of sucked. But I combined my own peppermint peppermint bark, I guess.

Chip Griffin 

Right. And there are a lot of folks who do have, you know, the side hustles that are non competitive, whether that’s you’re driving for an Uber or Lyft, or doing some of these other gig economy type things, because it is a good way to generate some extra income, particularly, you know, for your younger, more junior employees who may be looking to either supplement their salary or just, you know, put away some more money so that they can afford a nicer vacation whenever people do more traveling than they are now. You know, all those kinds of things. And so I think it’s smart to allow people to do that, as long as it’s not interfering with the main business. But that’s that, that usually these disputes come into play, because there’s a disagreement over what’s truly interfering with your ability to do your job, because your perspective may not be the same as mine as the employer on that. And you also may not have the same perspective on whether something is competitive or not. So there’s, there’s always gonna be some gray area here. But I think it’s, most of the problems with all of these things get solved simply by communicating. And so if if, if you share what your expectations are, as an owner, if your employees share what they’re up to, and you figure out how to sort them through, generally they work out the vast majority of times when I see a breakdown, it’s because one party either wasn’t clear, didn’t share information when they should have. or, frankly, we’re trying to pull a fast one. Yeah, and, you know, those tend not to end well.

Gini Dietrich 

That is 100% true. So be clear, create a culture that people feel comfortable with telling you the truth, and being open and honest. have experts set expectations and be open about what they are, and you’ll be fine. I mean, sure, you’re gonna have occasional things that come up, but for the most part, it’ll be fine.

Chip Griffin 

Yep. And it’s mean frankly, you know, some of these side hustles can actually be beneficial to the employer, right? Because sometimes you learn new skills, you certainly start to learn some, some business skills, which can be very beneficial, right? So you know, there’s certainly value to it. But communicate, be transparent. Everybody give each other a hug, and it’s

Gini Dietrich 

all gonna work out fine. Sing a song will be good.

Chip Griffin 

With that I will not sing a song, but we will bring this episode to a close and I still haven’t figured out that other podcast. I’m going to start but eventually I will

Gini Dietrich 

do it for you let me know so that we can have a conversation about it.

Chip Griffin 

Oh, maybe we’ll see. Anyway, this is the Agency Leadership Podcast. I’m Chip Griffin

Gini Dietrich 

and I’m Gini Dietrich,

Chip Griffin 

 and it depends.

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