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Does My Employer Own My Intellectual Property?

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If you are an innovator or a creator, it is crucial to understand your intellectual property rights. The question of whether you own your intellectual property (IP) can be particularly confusing if you are an employee. Generally, the intellectual property you create in the ‘course of employment’ will belong to your employer. In this article, we explain how to determine if your employer can claim ownership over your intellectual property and how to protect your IP.

What Does The ‘Course Of Employment’ Mean?

The ‘course of employment’ may change depending on the type of work you do. In relation to intellectual property, this refers to anything you create as part of your employment.

For example, suppose a company contracts or employs you to
develop software. Accordingly, your employer will likely own any software you create. 

However, suppose creating software is not part of your employment duties. If so, you may own the intellectual property rights providing you did not use company resources to create the intellectual property. Another factor to consider is when you begin and end your work day.

Working on a project or creating something outside your employment hours means your employer is less likely to successfully claim ownership over your IP. Of course, all of this will depend on your employment contract. Some key issues to consider are whether:

  • your employment contract outlines your roles and responsibilities, and if so, whether creating IP (e.g. software or articles) falls under these roles and responsibilities; and
  • your employer or any other staff member directed or contributed to creating the IP.

Your Employment Contract

Before signing an employment contract, it is essential to read it carefully. You might be signing over more than you think. For example, some contracts contain special clauses that give your employer rights over your ideas or inventions, even if they have nothing to do with your job. Although these restrictive clauses may ultimately be invalid, you should still read the clause carefully and flag any provisions that: 

  • do not make sense; or 
  • seem too restrictive.

You should also check if your employment contract includes a provision that prevents you from competing against your employer after the termination of your employment. If this is the case, any work, project or venture that competes with your previous employer can place you in breach of this agreement. You should look out for these provisions as they can be very broad and may operate for a lengthy period after your employment terminates.

While an overly extensive restraint clause can be onerous for an employer to enforce legally, the threat of litigation is genuine and could:

  • drain your well-earned capital; or
  • damage your reputation.

Fortunately, these clauses will not likely establish ownership over your intellectual property. This is particularly true if you created the idea or work in your spare time and without using your employer’s resources. Nevertheless, if you want to ensure such a clause does not bind you, look for any provisions dealing with intellectual property after employment.

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What if I Am Working On My Personal Device?

Sometimes, the resources you use to create intellectual property can influence the question of ownership. Your employer’s right to claim intellectual property ownership can extend to works you create using their resources and materials. However, personal and professional lines may blur if you use your personal laptop or PC device for work. This is important as your employer’s right may extend to intellectual property outside work hours.

Avoid working on your personal device for work-related projects. This will reduce your risk of losing your intellectual property to your employer.

Ways to Protect Your Intellectual Property

Write it Down

Keeping written records of your invention or work can reduce the risk of legal battles over intellectual property ownership. For example, keeping a diary detailing the dates and stages of development of your intellectual property can be instrumental evidence. 

Emails or electronic records are also helpful if they record a date and time.

Review Your Contracts

Look out for any clauses in your employment contract that discuss intellectual property. If you need clarification on the wording or the meaning of statements within a particular clause, flag it and raise it with your employer. This should be via email so their response is in writing for your records.

Choose Your Hours Carefully

Make sure you know when you start and finish work. This will help you determine when you are free to work on your projects without attracting a potential claim of ownership from your employer.

Use a Different Device

Keep your work device separate from your personal device. Avoid using the resources your employer provides.

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Key Takeaways

If you create intellectual property as part of your responsibilities at work, your employer is likely to own it. If you create intellectual property outside the scope of your duties as an employee, however, subject to your employment contract, you will likely own the intellectual property rights. Therefore, you should read your contracts carefully, as there may be a clause that claims ownership of your intellectual property created during or after your work period. 

If your employer is attempting to claim ownership over your creation, our experienced IP lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.

Frequently Asked Questions

Does my employer own my intellectual property if I am a contractor?

Although it is assumed that the employer will own intellectual property (IP) created by employees, the same cannot be said for contractors. Generally, independent contractors own the IP they create unless otherwise intended by a contract. Therefore, whether you are a contractor or an employer, it is important to have a contract determining who should retain ownership. Otherwise, the default position will be that the contractor owns the intellectual property.

How do I determine what my employment duties are?

The details of your employment duties and what is expected of you as an employee are likely to be stated in your employment contract. A key tip is to look for clauses describing your role, your performance, how you should deliver work, and so on. That might give you a better idea of what would fall outside the definition of work completed ‘in the course of employment’.

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