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Side hustle from home woman checking her phoneStarting a Side Hustle From Home

Whether you dream of having your own startup and leaping off the corporate treadmill or just making some extra coin, starting a side hustle from home is one proven method to achieve your goals. Running a side hustle from home is especially helpful during the COVID-19 pandemic and keeps plenty of professionals afloat in these difficult times. Before you pull the trigger, however, there are a few things to consider.


1. Does your employer have a policy that limits you?

If you’re a professional – for example, a lawyer, engineer, architect, or doctor – it’s a good bet that your current employer has a policy that bars you from using your professional skills for anyone who isn’t their client. If you violate this policy (even by giving pro bono service to a non-client) they can terminate you.

One reason why employers adopt policies limiting their employees from working a side hustle from home is to reduce their exposure to malpractice claims. A non-client whom you serve in a professional capacity might attempt a claim against your employer, even if your service to them was clearly independent of your employer.

In short, if there is a policy that bars you from offering professional services outside of your current employer, then don’t do it.


2. Will you be working with current co-workers? Or with a friend?

If you and a co-worker are launching a side hustle from home (via Zoom, Google Meet, etc.) together consider how that might impact your day jobs. This is especially tricky if one of you holds a supervisory role to the other.

Though it doesn’t necessarily raise any legal issues, the likelihood of side-work issues bleeding over into your day jobs is high and that could complicate your ability to perform.

If you’re working with another person, be sure you have talked through issues such as who contributes what and when, how profits and losses will be allocated, and how you’ll handle it if one of you wants out. This part can be especially tricky and dangerous.

Make sure you know the risks of starting a side hustle from home with others and establish clear legal responsibilities. This blog post should help you get started.


3. Limit your liability with an LLC.

Whatever you do, don’t go into business without the protection of a limited liability company or a corporation. Otherwise, all of your personal assets are vulnerable to lawsuits or business failure.

For most people, an LLC is a much better fit than a corporation because corporations are subject to fairly complex governance laws that are likely not a good fit for a side hustle from home. LLC’s are inexpensive to create and flexible in how they are governed (see more here). However, that doesn’t mean that you should jump in without any legal counsel – especially if you’re going into business with others.

A good lawyer can help you understand all the various choices you face in setting up your LLC and as your business grows, you’ll have someone in your camp who can help you make tough decisions, get paid, and avoid getting your pants sued off.

If you want to learn more about LLCs, check out our 5-part blog series that will help you understand all of the risks, benefits, and opportunities in starting an LLC.

Whatever your motive, starting a side hustle from home is exciting and you should be pumped about all of the opportunities it can provide. This is your chance to make your own business and create something new. It’s a new and exciting chapter that Dunlap Law is excited to help you with. If you want business law advice, we are excited to help you. Book a free consult with us now!