It’s an exciting moment when you finally get your first online job.
After months of looking for clients, you can now experience the benefits of remote working.
For one, a stable income – while having more time for your family or passion projects.
Now comes the contract signing, but wait, is that a non-compete clause??
Okay, so not everyone is well-versed in civil law and contracts.
So, let’s talk about the non-compete clause -and how it might affect your remote career.
What is a Non-Compete Clause?
In simple terms, a non-compete clause is a legal agreement that says the employee/talent can’t work for a competitor for a certain period after leaving the job.
It typically specifies a geographical area and duration where you can’t work for a competitor or start a business in the same industry.
Why Do Clients Include This?
So why do clients include a non-compete clause in their contracts? It’s actually to protect their interest.
When you work with your clients, you may learn some trade secrets and confidential business information, and form substantial relationships with customers and prospects.
Also, some companies may invest in your skills with free training, seminars, and mentorship.
From the client’s point of view, they won’t make it easy for their competitors to poach you to gain an unfair advantage.
How Can It Affect Your Remote Career?
Does a non-compete clause mean that you’re stuck with one client forever? Not necessarily.
There are limitations in place so you can still sustain your livelihood even after resigning.
These include the following:
Geographical Area
A non-compete clause should have a specific geographical area that’s not too broad. Some express it in proximity like “200 KM from our home office.” Some use a zip code, city, or town.
So outside that proximity, you can still entertain clients – even in the same industry.
For example, let’s say you have a non-compete clause with a client in Australia. You can generally still get a US client in the same industry because they’re too far from the company’s base of operations.
Scope of Services
Next, the scope of services should be explicitly stated.
So if you have a non-compete clause for graphic design services, you can probably render virtual assistant services for other clients.
Competitors
A non-compete clause can also be limited to a particular industry or several direct competitors.
Thus, you can still get clients from a different industry.
Duration
A non-compete clause should have a reasonable duration. Commonly, this can be anywhere from a few months to as far as 2 years.
Penalties for Violating the Non-Compete Clause
Now that you know what a non-compete clause is, what will happen if you violate it?
Most companies can sue you for potential financial damages. This might range from the potential income they lost to a competitor plus additional damages.
On the other hand, some companies include a fixed penalty when you break the non-compete clause.
So if you’re taking on more than one remote client, make sure you choose them carefully.
However, if you don’t have an online job yet, you can sign up with Remote Staff for the best remote working opportunities for Filipinos.
Remote Staff provides well-paying, long-term contracts that might make additional clients unnecessary.
Plus, should your client no longer need services, Remote Staff can find you a replacement so you can still enjoy ongoing income.
Register today!
