A non-compete clause is a common contract term that can limit your future work options. For freelancers, understanding this clause is crucial for protecting your business.
What is Non-compete clause?
A non-compete clause is a contract provision where you agree not to work for a client's direct competitors. It's designed to protect the client's business interests, trade secrets, or confidential information you may learn while working for them.
Why is this important?
This clause directly impacts your ability to find new work. If it's too broad, you could be locked out of your main industry or niche for months or years. You must assess if the restriction is reasonable before signing.
How does it work?
The clause specifies a duration, geographic area, and scope of restricted activities. For example, it might prevent you from working with other companies in the same city and sector for one year after your project ends.
Pros and cons
Potential pros include securing a trusted, long-term client relationship. The major cons are severely limiting your future income and market access. An overly restrictive clause can make it hard to sustain your freelance business.
Conclusion
Always read and negotiate non-compete terms. Aim for reasonable limits on time, geography, and scope to protect both the client and your right to earn a living. Never sign an overly broad restriction.
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