I am not talking about non-competes, I am talking about moonlighting.

On the day of employee orientation, they specifically talk about moonlighting and HOW to do it.

"Do not use any hardware we provide for you, and do not use any software you installed from the corporate network, buy your own copy of development tools and licenses, you can use the free Azure credits we give you but not the ones linked to your employee login, make sure you use the credits on your personal account."

They do require you not write software that directly competes with existing Microsoft software, for obvious reasons, but other than that it is fair game.

But this doesn't even cover the whole of it. At multiple times, Microsoft has actively encouraged their employees to write software as a side hustle! They've launched internal competitions "We have a cool new SDK, write some software and put it on the MS Store! Best rated software wins some prize!"

The entire "developers first" culture there extends to how they treat their own employees.

Heck MS has a long tradition of employees leaving to start a new company and MS buying that company up a few years later. I suspect that during the 90s/early 2000s it was seen as a good way to innovate, similar to incubator labs within companies now days.

Which law are you referring to? Noncompetes are enforceable in Washington but not in California, for example, and Microsoft has enforced noncompetes for upper management in several high profile cases, but I am not aware of any enforcement against engineers.

And not in california? Its interesting that Apple is seen as hip and cool yet operates a tight leash obviously because it can, legally. Microsoft is... other things... yet is operating a looser leash, albeit also in compliance with law.

Interesting but not surprising I guess.

Microsoft is also "older" on the software side of things, and is probably the source of why that law came into being in Washington state.