Does the employer own the rights to the works and inventions of its employees?

The question of the ownership of intellectual property for works and inventions made by employees is a recurring question. Does the company have intellectual property rights, or does the employee still own them?

It is a source of real concern for companies since significant investments may be called into question by their employees if the transfer of rights has not been planned in advance. Cases of conflicts with employees are particularly destructive in this context.

This problem can be found in the areas of copyright, designs and models and patents.

In general, we will see that it is preferable to provide for the transmission of intellectual property by contract, before the creation of the work or invention.

Who owns the intellectual property of works created by employees?

Employee copyright.

The employee is considered to be the author of the work, regardless of this work. This is a basic principle of intellectual property, established by article L111-1 of the Intellectual Property Code.

“The author of an intellectual work enjoys over that work, by the mere fact of its creation, an exclusive right of intangible property that is enforceable against all.”

The only exception to this principle concerns collective works, defined by article L113-2 of the Intellectual Property Code:

“A collective work is a work created on the initiative of a natural or legal person who edits, publishes and discloses it under his direction and name and in which the personal contribution of the various authors involved in its development is integrated into the whole for which it is designed, without it being possible to attribute to each of them a distinct right over the whole produced.”

This is the case where a work is managed and directed by an employer, and where the contributions of employees form a whole that is impossible to separate.

In this case, the employer is considered to be the author as long as he has the role of project manager, such as a conductor.

In practice, it is sometimes difficult to differentiate between a collective work and a collaborative work, in which all authors have a shared right. As an employer, it is not advisable to expect to own intellectual property rights on this basis alone.

Employee designs and models.

Designs and models are protected by both copyright (governed by the rules referred to above) and specific design law.

The texts do not clearly provide for the applicable regime, but it is generally considered that designs and models follow the same regime as copyright.

The employee therefore owns the copyright on his design or model, provided that it is not a collective work.

How to transfer intellectual property rights from the employee to the company?

In view of these elements, it is therefore particularly important to provide means of transferring intellectual property from the employee to the company.

In the absence of transfer, the employee could claim his rights to the work, in particular in the event of a conflict with his employer, which would have the consequence of placing the company in a perilous situation.

The transfer of copyright from the employee to the employer.

In terms of copyright, two situations are possible:

• The work is software: in accordance with article L113-9 of the Intellectual Property Code, copyright is vested in the employer.
• The work is not software: copyright belongs to the employee, if no contractual clause provides for transmission. In the event of a contract, only exploitation rights can be transferred, moral rights being non-transferable.

The most reliable method is to include a copyright transfer clause in the employment contract, whether for software creations or of any other kind.

This clause must be measured: it generally provides for the transfer of copyright for any work produced in the performance of functions. The clause may be broader and provide that any work done during working hours belongs to the company.

It is necessary to clearly identify the works concerned, as a clause that is too general would be considered void by judges in the event of a dispute. If the clause in the employment contract is general, it will be important to identify the works concerned a posteriori and to link them to the contract (for example by way of an amendment).

For purposes of validity, the transfer of copyright must therefore provide for the details of the rights transferred, as well as the duration and territory of the transfer, in accordance with article L131-3 of the Intellectual Property Code.

If there is no such clause in the employment contract, it is possible to have the employee sign an amendment.

The specific regime for employee inventions, in terms of patents.

Patent law provides for several systems to govern employee inventions. These are more employer-friendly than those covering other intellectual property rights. Indeed, patents are part of industrial property, which mainly concerns businesses, as their development sometimes requires substantial investments.

Article L611-7 of the Intellectual Property Code provides for the following regimes:

• If the invention is carried out by the employee, and the employment contract contains an inventive mission corresponding to the functions of the employee, or if a specific mission has been given to the employee and results in an invention: the invention is the property of the employer. However, the employee must obtain additional remuneration for his work.
• If the invention was made by the employee as part of his work (working hours, professional equipment, etc.) but without a specific mission, it belongs to the employee but the employer can have the invention attributed to him but he must compensate his employee precisely.
• If the invention is carried out by the employee in any other context, it belongs to him.

The key point is again the inclusion of the invention or the inventive mission in the employment contract. Otherwise, the company will have difficulty in being recognized as the holder of the patent, or will at the very least have to pay a large sum to its employee.

The attribution of employee inventions is a recurring problem that is the source of numerous disputes before the courts.

Whether you are an employee or an employer, it is in all cases fundamental to foresee the fate of inventions as soon as the contract is concluded, in order to avoid uncertainties and conflicts.