TBI Solicitors is advising North East businesses to review its employee contracts to ensure that it owns any intellectual property (IP) created by its workforce.

Amanda Mitten, specialist in Intellectual Property at TBI, says: “Employees are

Amanda Mitten

“Businesses need to be clear about who owns the rights to the IP created by an employee.”

TBI advises that when IP is created by an employee, the general rule is that the rights belong to the employer. This is subject to certain conditions including any contrary agreement, which would usually appear in the employee's written contract of employment. However, it could also be an oral agreement if there is no written contract or that contract has been varied.

Another aspect to this general rule is that for the IP to belong to the employer it should have been created by the employee in the course of their employment. The interpretation of this condition can cause difficulties. Clearly the starting point is the contract of employment and job description, but these will not always be conclusive on their own.

Amanda says: “It will have to be decided whether the creation of the IP fell within the scope of what the employee was employed to do. For example someone employed as a cleaner who devises a new piece of equipment that could greatly improve the employer's factory line production would probably not be acting in the course of their employment. But there are exceptions. The more senior an employee is, the more likely the creation of IP will be found to be in the course of their employment.”

The courts may be prepared to agree that an employee's duties have evolved over time and have come to include the creation of IP, or that an employee has been given an exceptional task to carry out outside their normal duties. Other factors that might be relevant are whether the IP was created during work hours, and whether the employee used the employer's premises, equipment etc.

Amanda adds: “What is evident is that it is always much better to have a very clear contract of employment in place including a specific description of the employee's duties where appropriate.

“In the specific context of inventions, it is also worth being aware that if patent protection is obtained by the employer then the employee inventor may be entitled to compensation for their efforts.”

TBI Solicitors advises businesses to seek legal advice on any of these issues, including drafting new or checking existing contracts and dealing with disputes between employer and employee in circumstances involving IP.

For further information, please contact Amanda Mitten on 01740 646 017.

For further information, please contact Amanda Mitten on 01740 646 017.