There are many “entrepreneurs-in-employee clothing” who are itching to leave their current employment and start off their business. However, due to various considerations such as financial stability, the need for experience, the business growth learning curve etc, many budding entrepreneurs prefer to remain in employment while growing their business.

Whilst this is good and laudable stance, a budding entrepreneur should carefully consider certain issues that may arise at the time of his exit and begin to innovate soft-landing pads for his exit from employment. This article is also useful for employers of such employees clothing as it will help them decipher when their employee is planning to exit his company and prepare for such exit (such as, getting and training a replacement). It will also help employers protects their interests, particularly the intellectual property created in the course of their employment relationship.

As an employee going into business, there following issues must be carefully considered and catered for before launching out into business:

The two-in-one role:

I want to start my business while in employment to allow it get stable before I resign/retire. Can I do this?

Yes, you can! However this will depend on a lot of things. You need to check your contract of employment (usually contained in one or more of your letter of employment, employee/staff handbook, staff policies and rules) to see if there is a clause that prohibits you from engaging in other business activities.

Such clauses may be broad or restrictive. A broad clause will state that the employee cannot engage in any form of business, whether it is in competition with that of the employer or not. The restricted clause however, will prohibit an employee from engaging in any business that is in competition or conflicts with their line of business. Where the prohibition clause is the former, it will be wrong to engage in any form of business while you are still in employment, if it is the latter, you can start a business while in employment once it is not in competition with your employer’s business.

You also need to ensure that you do not violate your fiduciary duty by using the employer’s time and resources to pursue your business interests. An employee has a duty to execute his diligently and give his best to his assigned duties and failure to do this will amount to a breach of your fiduciary duty.

Who’s brain child?

What happens where an employee develops a design, copyrighted material and other things which are protected by copyrights, patents and so on in the course of his employment? will it be his? will it be that of his employer? These questions should be clearly addressed, so that the employee can adequately protect his intellectual property before he leaves his employment.

Under Nigerian law, ownership of a copyrighted work is vested in the author (that is, the person who developed the copyrightable work) irrespective of whether or not he created the work in the course of employment. Where however, the work is an article or other write-up written by an employee of a publishing or newspaper house, and it is published in that periodical, newspaper or journal, the owner of the work will be the newspaper or publishing house.

The exception to this rule is where the employee and employer enter into an agreement that any copyrightable work developed by the employee in the course of the employment will belong to the employer.Therefore, an employee must carefully examine the various components of his contract of employment to determine if the employer has inserted an intellectual property assignment clause, which vests ownership of such works in the employer.

For patents and industrial designs, ownership is vested in the first person to register that patent/industrial design. Thus, an employee can protect his ownership of a patent/industrial design by registering it before his/her employer registers it. This however, will not apply where the employee has assigned ownership through a contractual arrangement.

There is no better way to say this, but…

ou have now set up your business and you feel it is time to face the business squarely, how do you exit from employment gracefully? This will also depend on the compendium of your contract of employment, unless you are a junior level staff (e.g. Gardeners, Cooks, Drivers, Security Man etc) in which case, the Labour Act will apply.

Most employers require their employees to give notice of resignation (or sometimes, pay in lieu of notice) and the notice period usually varies from 1 – 2 weeks (if under probation) to 1 -3 months (after confirmation) and in some cases, 6 months (for very senior high-level staff). The notice period may be more or less, and can only be determined by your contract of employment (usually, your letter or employment or staff handbook).

You will have to give notice in accordance with your contract or pay in lieu (although employers prefer and have more respect for employees that give notice). Most employers expect the notice to be in writing, therefore, you will need to tender a letter of resignation/retirement.

Your letter of resignation/ retirement should be carefully worded in order to avoid liability for libel (and create resentment on the part of your employer and co-workers). It is also advisable that you keep it short- announce your resignation/retirement and thank the management and colleagues for the opportunity to work with them!

Can I be my employer’s next competitor?

Will your business be in direct competition with your employer? You will need to check whether your have been contractually bound not to set up such a business. Employers at times, insert non-circumvention/non-compete clauses or enter into non-circumvention/non-compete contracts with their employees. If you have entered into any such contracts, you will have to re-think your business line, or stand the risk of breaching your obligations and be liable to pay damages.

In other jurisdictions where non-compete/non-circumvention agreements are better regulated, the restrictions in the agreement must be reasonable (in scope, time and extent) for it to be enforceable against the employee. As an employee, you should check to confirm the existence and extent of the non-circumvention/non-compete obligation before you proceed to start up the business.

Once you are able to adequately address the above, you are on the path to establishing a successful business!

Source: http://pearlworthconsultants./2013/11/21/are-you-an-entrepreneur-in-employee-clothing-you-should-read-this/

http://www.yahoo-mail.com.ng/holidays-pay-employers-duty-employees-obligation am not so sure this might be of much help. Still i got to try.

Pearlworth, Thank you for sharing this very interesting article.

It's such a shame that many of Nigeria's brightest minds (who could've become excellent entrepreneurs) are currently working as employees for other people. It's understandable that they're afraid to take on the risk of entrepreneurship because it's so hard to forgo the certainty and security that comes with a regular monthly salary. The sad thing is many of these people have interesting and innovative business ideas locked up in their heads. Many of these business ideas will likely remain the dreams they are and follow these bright minds to retirement age.

Are you an entrepreneur locked up in an employee's clothing? Do you feel your job deprives you of a creative outlet and freedom that entrepreneurship provides? Do you want to realise your business dreams but want to be SURE first before you quit your job? Well, you're in luck! There's actually a way to have your cake and eat it. It's possible to start a business and keep your job until you're confident enough to quit and face your new business.

If you're in this category and you're confused, too afraid to act and don't know where to start, I suggest you read the following amazing articles:

How to Have Your Cake and Eat It! Five Businesses You Can Start and Still Keep Your Day Job http://www.smallstarter.com/know-the-basics/start-your-business/how-to-start-a-business-and-still-keep-your-day-job

Sad But True – Five Reasons Why You May Never Start A Business in Your Lifetime http://www.smallstarter.com/know-the-basics/start-your-business/5-reasons-why-you-may-never-start-a-business

I hope you find the inspiration and boldness you need to start your dream business soon. Your job is not the big excuse you think it is.