Yes, you can work for your employer and your licensed LLC at the same time-as long as you comply with your employment contract, avoid conflicts of interest, and maintain clear boundaries between your job and your business.
Running an LLC while working a day job is common, especially in the early stages of entrepreneurship. If your employer licenses a product or service from your LLC, it can even be a mutually beneficial arrangement. Still, this dual role comes with potential complications. You’ll need to protect yourself legally and ethically to avoid issues that could jeopardize your job or your business.
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1. Understand the Nature of the Licensing Relationship
If your employer is using a product, service, or technology your LLC provides, this is a business-to-business relationship. As long as that relationship is formalized through a licensing agreement, your LLC is a vendor or contractor-even if you’re also on the payroll as an employee.
This separation of roles is crucial. Your LLC must function independently, with its own bank account, contracts, and business structure. That way, your employer is clearly paying your company-not you personally-for access to the licensed product.
2. Review Your Employment Agreement
Before maintaining both roles, carefully review your employment contract. Look for clauses that could restrict or complicate your LLC activity, such as:
- Conflict of interest policies – May prevent outside business relationships that could influence your duties
- Non-compete clauses – Could bar you from operating in the same industry
- Intellectual property clauses – Might claim employer ownership over anything created during employment
- Moonlighting policies – May require disclosure or prior approval for side businesses
If your employer has licensed something from your LLC and your job is related to the same subject area, extra care is needed to avoid overlap or conflicts.
3. Set Clear Boundaries Between Job and Business
It’s essential to keep your employment and your LLC completely separate. That means:
- Using your own devices and tools for LLC work
- Working on your business only outside of company hours
- Maintaining a separate business bank account and legal entity
- Not using your employer’s resources, data, or personnel to run your LLC
- Keeping detailed records of product development timelines and licensing agreements
Clear separation minimizes the risk that your employer could claim ownership of your work or accuse you of violating internal policies.
4. Disclose the Relationship if Required
Some companies require employees to disclose any outside business interests, especially if the business interacts with the employer. If you have a licensing deal with your employer through your LLC, it may be wise-or even mandatory-to disclose this arrangement to HR or legal.
Disclosing the relationship can build trust and reduce the risk of disciplinary action later. It also helps document that you’re operating in good faith and not trying to hide a conflict.
5. Know the Risks and How to Manage Them
Working for your employer while running a licensed LLC is legal-but not risk-free. Here are a few challenges to anticipate:
- Perceived conflict of interest: Your coworkers or supervisors may question your loyalties or decision-making
- Job performance issues: Your time and attention are split between two obligations
- IP or policy violations: If you’re not careful, your employer could claim rights to your LLC’s work
- Power imbalance: Your employer may attempt to pressure you into changes you wouldn’t accept from another client
You can manage these risks by treating your LLC as a separate entity, documenting all arrangements, and staying transparent when required.
6. When the Arrangement Can Work Well
Running your LLC while working for your employer can be a win-win in some cases. For example:
- Your LLC provides a niche tool or service your employer needs
- Your employer wants to support your innovation without absorbing your business
- You’re developing a product with broader market value beyond your employer
If the relationship is well-managed, this can provide income for your LLC while giving your employer access to something useful-all without forcing a sale or exit.
You can absolutely work for your employer and operate a licensed LLC at the same time, but only if you maintain legal clarity, respect your employer’s policies, and operate your business independently. Keep the relationship professional, avoid conflicts of interest, and protect your intellectual property. With these safeguards in place, it’s possible to grow your business while maintaining a healthy working relationship with your employer.
