In my local jurisdiction it would be illegal for an employer to have any say in what you do outside work hours. They might try some restrictions via their employment contract, but in general it would have no legal effect whatsoever.
I've also worked at some start-ups that don't put this into their contract (or remove it when asked) so as not to scare the talent away.
I think you're right for the larger corporates though. It's often not enforced, but you run the risk of them claiming that it was "done on their time"-style issues later if its successful.
As long as you are not using company resources, including company time, or producing something that competes with the company (effectively using inside knowledge, another company resource), in most legal jurisdictions they can't stop you and any contract clause that tries is not legally enforceable.
Of course that doesn't mean many don't try block such things…
It depends a bit on the jurisdiction (I'm not really sure if laws or local culture came first, but they tend to go hand-in-hand for this issue).
E.g., in CA there are only a few whitelisted situations where your employer could own your side project, and in all other cases it belongs to you. As a matter of practice, most companies in the area allow side projects, and many "require" that you ask permission -- since they'll just rubber stamp approval onto whatever you're doing anyway, that typically works out in your favor; now you have written proof that your employer doesn't want to exercise any potential claims to your project even if it nominally seems to infringe on their business.
My employer would only complain if the side-project would reasonably make me less efficient within my contracted hours. So if I were doing 40h (5 full workdays here) every week and I'd be putting in 40h/w as well.
The other gotcha is that side-projects shouldn't be in any way competing directly with my employer. If you work in product-development that is pretty easy to isolate. Agencies on the other hand could basically make anything for a client. So that's a bit tricker.
No idea what of my contractual limitations are actually enforceable, though. And they've never complained about side-projects because my own projects aren't anywhere near something they would accept as a client.
As long as I'm not releasing something that is a direct competitor for my job, it's all fine. Main thing I learned is that being open about it at work takes away the fear and worries.
It doesn’t really matter if they accept it or not, you’re doing it on your own time. The US may be different, but here you employeer have zero say in what you do in your spare time. Don’t use company issued equipment or software licenses, that changes thing, and may count as misuse of company property and that can get you fired.
Most companies I’ve worked for have a provision that states they can buy my projects, by compensating me for my work.
