Who owns the IPR to Contractor’s Work? | DCR Workforce Blog

Who owns the IPR to Contractor’s Work?

Intellectual property rights celebrate the creative genius of humans but they are also the stuff real life nightmares and Hollywood movies are made of! Take ‘Social Network’, which dramatizes the sensational dispute between the Winklevoss twins and the founder of Facebook, Zuckerberg. The twins’ single-minded pursuit of their claim got them a $65 million pay off. There are many more individuals and organizations who have failed to prove their rightful claim to their creative work or brainchild when someone else walked away with it and made profits!

More and more technology companies are going the contract employee route these days and any failure to protect IPR could result in a major setback to their operations, when we consider how technology lives from one release to the next, these days. Organizations may own such intellectual property, or it could also be something they had paid the worker to create for them. How do organizations protect their Intellectual Property Rights from contract employees who need to gain access to proprietary information in the due course of their work and also when they are assigned duties which result in producing a creative work?

 Activities that create an IPR

Let us take a look at the kind of activities which would result in an IPR in the hands of a worker, sometimes without plan or volition outside of activities like research which are expected to create intellectual property.

  • Writing an article or a book or creating any other reading or reference material.
  • Designing/creating artwork, logo, graphics, architectural blueprints, toys, games, computer software, music, photographs or films etc.

The important question to ask here is; does the title to the intellectual property automatically get transferred to the employer or the client who assigned the work to the contractor or does the contractor have full rights over his/her own creation? What happens if the contractor was hired as a temporary worker, or an independent contractor? Who has the right to use the work, copy it, distribute it or establish a commercial use for it of any sort?

Get the Copyright:

Some jobs are designated as work-for-hire where the title to the work remains with whoever commissioned the task. The Jobs are detailed below:

  • A contribution to a collective literary work or translation
  • Any audio-visual production
  • A compilation
  • A supplementary work (e.g.: appendices, bibliographies, charts)
  • A test or answer material for a test
  • An instructional manual or text
  • An atlas

It is possible to get legally entitled to a work-for-hire as its author, if and only if there is a contract specifying such terms in place with the contractor, whether temporary or independent. The written legal agreement entered into must clearly mention the particulars and details of with whom the copyrights or license over the work will be vested.  In some cases, there could be a sharing arrangement which distributes the claim, and specifies which portion of rights will vest with whom and the purpose for which the rights may be claimed.

Other safeguards that can be put in place pertain to the use of company resources and what happens to the worker’s output. Some such important clauses are detailed below:

  • Prohibit the use of company resources to create, transmit, store, copy or display any messages, images or material for personal gain or any other purpose.
  • Retain the right to access and inspect all equipment belonging to the company like computers, servers, systems, telephones, voice mail systems, desks, lockers, cabinets, vehicles or any others being used by the worker.
  • The Company should hold the right to all business emails; voice mails and other non-personal data stored or transmitted using the company’s equipment.
  • Caution the worker not to expect any personal privacy in any messages and records created, transmitted or stored on the company’s system.

On-boarding:

On-boarding and off-boarding are two aspects of contingent workforce management which need to be handled effectively to retain/protect intellectual property. These two processes are also crucial to ensure that the existing intellectual property rights are effectively protected through proper paperwork. Employers today put a “Proprietary Information Agreement” in place, signed and dated, to protect and restrict a worker’s use of knowledge with all the right clauses governing probable innovation and the rights arising out of it during the assignment as well as subsequently, in the longer term.

Off-boarding:

When worker completes the assignment and leaves the company, it is necessary to include a proper de-briefing into the exit process. This helps to reiterate and ensure the need for compliance with the obligation to waive the rights to work created by them and to see that they return all the company’s assets, sensitive/confidential information and to see that they have complete clarity on the extent of their claim (or lack thereof)!

We shall discuss the steps to be taken by a company when granting temporary workers access to existing IPR in a separate post.


Disclaimer:
The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.