[ChrisMarshallNY]

That’s the clause that says your employer owns every idea that you come up with in the shower. These often go way beyond the “anything done with company equipment or on company time” thing, which is actually already handled by standard employment law.

https://dilbert.com/strip/2006-05-20

[sizzle]

How is this legal?

[hansvm]

A sufficient amount of lobbying and precedent from underfunded defendants will make a lot of things legal (in the US).

In some states like CA, shower clauses are void except for a few explicit carveouts (the ones you might expect -- do personal projects on your own time and dime, and don't directly compete with your employer), but in, e.g., a lot of east coast states shower clauses are stronger and more commonly enforced.

Even when unenforceable though, you still have the threat of a court case; your employer can attempt to argue that your personal project falls into one of the exceptions that would grant them ownership of your IP, and a court case is sufficiently painful that it's a bit of a punishment in its own right even if you would win.

Also as a practical matter, some companies have shower clauses that additionally stipulate the company can allow you to retain IP on your personal projects if you ask permission. That could be abused, but for large enough companies that touch enough industries that can work out in your favor because a loose interpretation of the law would actually grant them ownership of your IP anyway, but if they have a policy of generally allowing side hustles then the fact that they've explicitly signed over any ownership claims to you will give you a strong leg up (and peace of mind) in any potential court cases -- potentially allowing them to be thrown out before they start.

[ChrisMarshallNY]

Sometimes, it’s not. But you’ll still need to go to court to fight it, and that makes it effective.