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Pretty sure that is conflict of interest unless they do totally different type of consulting
Eh, not necessarily ^
Most employment contracts state you can’t do a similar type of role for a competing company in the same market area.
So unless the employee is offering IT consulting to a possible buyer of the W-2 company, it wouldn’t violate the contract.
Of course it’s one of those “it depends” things, but every employment contract I’ve signed has had those particular stipulations.
As long as it is not in the same industry, it is ok. The only problem is when you are using company's resources to do such thing.