Shopify CEO Tobi Lütke discourages employees from side hustles in company memo, saying their jobs require their undivided attention.
In a leaked memo, Shopify CEO Tobi Lütke put limits on employees having side hustles, saying Shopify requires 'unshared attention'::Shopify CEO Tobi Lütke discourages employees from side hustles in company memo, saying their jobs require their undivided attention.
“I’m excited to share that Tobias “Tobi” Lütke, CEO and founder of Shopify, will join Coinbase’s Board of Directors.”, CEO Coinbase, Brian Armstrong, 31st Jan 2022.
"Our company is like a professional sports team, except we are definitely not going to pay you like actual professional sports players." - a guy who makes way too much money
I worked for as a software engineer for a company that I did interviews for. We were told that “pet projects” were a red flag unless they were a current college student. They showed a lack of commitment to their current employer. Basically, there’s no reason for them to have a side project, they should be working more for their current boss.
My employer is the same. I was almost fired for attending a (unpaid!) hackathon during a weekend. A colleague was fired for doing volunteer work in weekends.
Just wanted to add that part of this may be a culture thing. Here in Germany, you are required to get your employers permission to get a second job or the like. Many of you might instinctively find this corporate BS, but in reality it's mainly worker's protection. No employee is allowed to work over 60 (I think) hours in a week. To make the companies stick to that, the government will come for them if any worker exceeds this number. Your employer has the responsibility to not let you exceed that, even across multiple jobs. That's why you have to get permission for side hustles. There are other (not so pro worker) reasons for this, but that would go too far. Suffice to say that Lütke is German and this might be some thing he brought from Germany.
So I heard lots of frustration in comments around the concept but little commentary on the legality of it. Not a lawyer but do have extensive experience in HR and employment law:
Companies can put anything they want in a policy. That policy may or may not be legal. A policy that is not legal may open up lawsuit opportunities against the employer, but because most violated employees simply complain on message boards on the Internet instead of learning their rights, the policies and violations continue.
In this case, it has been well established that companies cannot limit your employment opportunities outside of work, unless you have a contract that specifically includes it AND you are provided consideration (payment or something of value in a legal contract) for this concession. You can be legally and simply terminated if you are doing non-company work on a company device, if your performance is not meeting standards, or if there are any conflicts between your employer and your other jobs, hobbies, etc.
There have been a lot of cases and laws in the last 5 years massively limiting the scope (because employers will always push any advantage as far as they can until they are regulated, legislated or outlawed) of "non-compete" clauses in job offers and policies. 10 years ago every employer was throwing these into employment contracts, some employees called them on their bullshit and now you don't see them as often--but there are definitely still companies (especially small or new) who don't have anyone who knows what is legal in this area and just make shit up. The only real holding power a non-compete has is if you have mission-critical information or trade secrets and again they must then receive consideration/payment for this concession of their ability to earn income elsewhere --and 99.9% of employees outside of C-suite don't.
If you're interested in learning more about employment law, trends, or have questions, check out my new community I created last week "Ask HR":
Shopify CEO Tobi Lütke wrote a company-wide memo Wednesday discouraging employees from having side hustles.
"This surprises me because it directly contradicts the countless times I've said Shopify is like a professional sports team that requires our unshared attention."
Even the company's president, Harley Finkelstein, has had his own Shopify store, Firebelly Tea, which he co-founded with the DavidsTea creator David Segal in 2021.
"Occasional side hustles like teaching a yoga class on the weekend or coaching your kid's soccer team once or twice a week aren't what I'm talking about.
And open source contributions are welcome, but give yourself an out - don't commit to big maintenance burden or letting them become a substantial workload," he wrote.
Shopify General Counsel Jess Hertz responded to Lütke's post saying that all employees would receive an email with more details on how they can disclose side projects or other outside work.
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