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Ask Slashdot: How To Own the Rights To Software Developed At Work?
New submitter ToneyTime writes: I'm a young developer building custom add-ins for my company's chosen SAAS platform as a full time staff member. The platform supports a developer community to share code and plug-ins with an option to sell the code. While I don't plan on having a breakthrough app, I am interested in sharing the solutions I create, hopefully with the potential of selling. All solutions are created and made by me for business needs, and I aim to keep any company's specific data out. I have a good relationship with management and can develop on my own personal instance of the platform, but would be doing so on company time. Going contractor is a bit premature for me at this stage. Any advice, references or stories to learn from?
Get a signed contract, written by a lawyer. Don't expect anything else to hold up in court.
If lawyers come after you it's always easier to explain to a judge/jury that you kept a nice tidy firewall between what's theirs and what's yours, assuming no overlap.
Anything you develop on company time with company equipment is theirs, unless specified in writing beforehand. How do you think Thomas Edison "invented" so many things?
Most business owners may have issue with you claiming IP for things built on company time. Even if you build something in your off hours, it may be difficult to prove you didn't use company resources.
Make sure that if you have an agreement with your employer that you have something signed by a senior executive or the owner.
You stereotypers are all the same...
Let me get this right, you want to be paid by your employer for your work, but still own everything you produce. You are putting nothing into this other than the time you are spending to produce the code, and that time is being paid for by somebody else.
So where is your skin in this game?. Sounds like you want somebody else to finance your enrichment.
Your best bet I see is to convince the company of the merits of Open Source, and the huge PR boost they could gain by giving away the source code under GPL.
That's probably the closest you'll get to having "rights" for the software you develop at work - or even while employed, for that matter.
Most likely in the employment agreement you signed, you probably agreed to give up all rights to anything you developed while employed by that company, even if you didn't write it on company equipment or time.
Ask your boss. You no doubt signed away the copyright to the code you write for work, so you'll likely need explicit permission from them. If whatever you're doing isn't something that interests them from a business perspective, they might just let you do it.
My previous and current employers have allowed me to Open Source the generic non-business-critical software I write. Beyond just making me happy, one of the reasons I gave them is that any improvements I develop outside of work will be able to flow back in -- it was a win-win.
Pretty much period. Thats the meaning of Employee.
If your a contractor, you MAY be able to own things you create, if you have a valid contract allowing it. One written by proper legal counsel.
Anything you do on company time and with company resources is owned by that company.
It gets a little more complicated if you're doing it during evenings and weekends on your own systems, but in many cases your contract will be written in such a way that that work, if it is in any way relevant to the business, is also theirs.
You're getting greedy. Just forget about it and, maybe one day when you're no longer employed by this company, you can come back and write this stuff.
I'll bet if you read your employment contract carefully, you'll discover that any intellectual property you create while on the clock automatically belongs to your employer. Some places claim ownership over your private projects done off the clock, although I fail to see how that would hold up in court.
So yea, the smart money is on not doing personal projects on company time.
An enigma, wrapped in a riddle, shrouded in bacon and cheese
IANAL. If you really want to explore this, though, you should get one. Your employer is paying for you to code on company time. It is reasonable to expect that anything you develop on company time becomes the property of the people who have paid you for that time, especially if you are using company resources to do so. Why not develop your own projects at home on your own time? There's much less room for a theft argument if you use your laptop, your internet, your tools and your time.
This is very easy. By default, anything you create - or even imagine - during business hours or in execution of your duties is 100% owned by the company. In fact, if you produce something at home and you can't show clean room separation between systems and code between your personal code and your work code, you're not likely going to keep the rights to that either.
You know that part of the employment process where they ask you to list all your prior works? This is them giving you a chance to CYA. Granted, the legalese on that page usually states that you're allowing them to use it for free in perpetuity if you include it in any of your work at the company, but that makes perfect sense Think utility libraries you carry around with you from job to job. They don't want to own them, but they can't risk having their products 'poisoned' by arbitrary licensing.
In fact, there's even a case where a guy had an idea, spoke to a co-worker about it, discussed it with his immediate superior and they decided not to follow up on it. After he quit the company, he started work on it himself, and was getting ready to finish/sell it, when he was sued by his prior employer. Because it had been 'developed' (thought of, even if it was never written down) on company time, the judge sided with the company and full ownership was given to them. He had to finish the program and deliver it and the mechanisms required to build and distribute it to them, without malicious sabotage Forced to write code for free, for a product the company didn't even want.
So! The only way this is really going to work for you is if you speak to your legal team and management.
I have, in the past, approached my manager(s) and asked permission to work on side jobs which were clearly and 100% outside of the scope of my current job; working on banking applications while I was writing automobile inventorying software, and was given permission. Got a signed statement, and I was good. Did open source work on the side as well, for a game engine, again, no problems.
However, it's extremely unlikely that anything you do at work will be allowed to be owned by you. No company likes giving away potential revenue and adding competitors with insider knowledge. I mean, really unlikely. Like, I can't even comprehend how you think it's a real possibility. Getting the company to go along with an open source thing might be one possibility, but an employee getting ownership?
Think of it this way: You work as a mechanic in a garage. You have access to all the tools and equipment there. You decide that you'll start your own business, in that garage, fixing cars, but you'll keep all the money instead of giving it to your employer, while still using his equipment and space. You still expect him to pay you for the hours you're working there.
Can you really see this happening? If so, you may need to lay off the cough syrup, cause we're all worried about you.
The only way.... Ignore the people saying contracts, no employer is going to sign a contract stating that all work you do for them is actually owned by you and they cannot profit from it. And even if they did, they sort of cease being an employer, and begin being your employee, except they pay you for the privilege of being your employee. It is sort of a contradiction, so it's impossible
Troll is not a replacement for I disagree.
The time to think about this is when you are negotiating your job offer. All standard IP contracts I've signed while on-boarding have included a specific provision saying the company owns anything you do. The company already owns it, so why would they change? You can ask, but I'm not sure how far you'd get.
Depending on the state you live in, you might be able to claim stuff done at home, without company resources in an area unrelated to the main business of the company. Sounds like what you want doesn't even fit the common exception in some states.
Most employment contracts would probably he reasonably interpreted as: if you do it "for business needs", they own it. That is kind of the point of these clauses. If they are in essence paying you to write it, you do it as part of your job, and you think it could have monetary value, how is it in their interests to let you retain the rights?
So you are thinking your company is paying you, to make something you can sell, to make money for yourself and not them?
Wow. Just wow.
Check your contract. Generally you sign away the rights even to things you dream of while with a company, let alone things you create for the company on company time.
For fun, ask management for a contract which allows you to sell whatever company products you want to sell.
I don't know about you - but there are two parts to my job...thinking and doing.
The doing part is easy enough to segregate...If I'm sitting at my desk at work "doing"...typing in code, debugging, documenting, etc - then clearly that belongs to my employer and I have no right to be "doing" anything that I'm going to have control over outside of work.
But thinking is near impossible to segregate. I may well be thinking about solutions to my employer's problems as I commute, or as I'm fritzing around with something else at home...and it's impossible not to have an idea for an outside-work project pop into your head while you're trying to come up with a solution to something that's work-related.
In my opinion, the inability to segregate work-thinking from home-thinking means that I shouldn't try. In my mind, I'm paid for the 'doing' part during office hours - and whatever 'thinking' is required in order to get the 'doing' done. 'Doing' that gets done on my own time is mine - as is whatever thinking went into making it happen. When I think of something that relates to my job - it belongs to them, even if I come up with it at 4am in a flash of dream-inspired wakefulness. And if I come up with something that would make a great off-time project while I'm waiting for my code to compile at work - then that's my idea and it's nobody's business when and where I came up with it.
The only requirement to make that work is a clean separation between the kinds of things I'm paid to do and the kinds of things I do for myself - but since "a change is as good as a rest", there is a natural tendency for me to do very different things in my off-time anyway. If you find that you have a fuzzy grey area in there - then you'd better lawyer-up and make sure everyone has a crystal clear idea of where the "doing" boundaries lie an that the "thinking" boundaries don't exist.
www.sjbaker.org
But get this through your head: AS AN EMPLOYEE EVERYTHING YOU PRODUCE IS OWNED BY YOUR EMPLOYER -- THAT IS WHY THEY ARE PAYING YOU -- THEY DO NOT PAY YOU BECAUSE THEY LIKE YOU -- THEY PAY YOU FOR OUTPUT
Got it? If so, please share with the rest of the entitled butt-hurt millennials who think they got a job solely because they "deserve it".
You signed one, so you should already know the answer.
Let your employer know that what you create is valuable for others, and suggest it as a new business opportunity.
- some companies, improvement suggestions are rewarded
- it increases your own importance, increasing job security and possibly growing the field into multiple people
- some of the risk is transferred to your employer (any buyer would have to approach him, not you)
If the employer thinks its not worthwhile you can still ask if you can pursue this on your own time.
Resign and start consulting NOW!
'Good relations' with management go quickly downhill once you reel in the money and they don't get a major cut.
Don't tell anybody, do it on your own machine and sell anything under a nom de plume.
Where do I start with this? You signed an employee agreement. What rights does it give you? The company is paying you to develop code, provides the compute infrastructure, provides the business motivation based on their own research and enables you to improve your knowledge and skills. You are unwilling to leave your job, so you don't accept any risk. Yet, you ungratefully want all of the benefits of the code. You don't even seem willing to share a possible new revenue stream with your company. You are quite the piece of work.
I'll bet you two lattes the OP is a Millennial... :)
maybe he'll let you have a go on his wife as well.
I own a software business. Anything written during working hours, for which the author is compensated by me, belongs to me. End of story.
Now, I did sign a contract with one of my employees who had his own open-source project from before he joined the company. it basically said that whatever he worked on on his own time was his, as long as it didn't compete with any of our products.
While you still know everything!
Never answer an anonymous letter. - Yogi Berra
Every consulting contract I've signed has an IP assignment clause. So, even if you do consult, make sure you negotiate your terms wisely.
You should be fired.
The company is paying you a salary, benefits, possibly sending you to training classes, etc. Everything you do on their premises belongs to them. Period.
If you are preoccupied with trying to figure a way to profit from THEIR software (that you write on THEIR dime), then they aren't getting what they are paying for.
Quit and start your own business.
In fact, that is great advice regardless. Take the chance now before you knock up some unfortunate woman and are saddled with a mortgage and child rearing expenses. You can live with your parents, friends, or your car if necessary, your family can't.
Hi
There is a few options that came to my mind, but all of them requires that you sign an agreement with your boss/Company.
1) Ask for an agreement telling that both parties owns the right of the software and source code. Try to avoid any “Eternal” periods of time of confidentiality since you may not know what happens in more than 5 years. So if your boss asks you for confidentiality of the source code limit the time of it.
2) When you set an agreement about the ownership of the source code and software, there is a good wording on the “IBM Customer Agreement” (http://www-05.ibm.com/support/operations/files/pdf/ica_us.pdf). Read “6.2 Materials Ownership and License”
Read “Type I Materials” and “Type II Materials” on the Type I the company owns the rights and gives you “ irrevocable, nonexclusive, worldwide, paid-up license to use, execute, reproduce, display, perform, sublicense, distribute, and prepare derivative works based on, Type I Materials. “
On “Type II Materiales” you own al the rights and you give the rights to the company of “.an irrevocable, nonexclusive, worldwide, paid-up license to use, execute, reproduce, display, perform, and distribute (within Customer’s Enterprise only) copies of Type II Materials.”
3) Other alternative is, if you can get an agreement with your boss, is to make to dump that source code, and start a new one from scratch on your home under your own time.
But there is a lot more alternatives that goes in the middle, why don’t making a company on your own and give some stocks to you “boss/hiring company” as payment of the rights of the source code there are a lot of options. You just need to negotiate.
Good Luck. Regards.
All this talk about where you work and contracts is irrelevant if the code is licensed to be freely shared and modified. Make sure your company understands the benefits of open source, then have them allow you to develop under said license. When you decide to incorporate under a different entity, you can resell the open source code using your private resources.
Custom electronics and digital signage for your business: www.evcircuits.com
If they are paying you a salary and providing you with a salary, and possibly training, they should own it. After all, that is your job. You may want to ask them to patent it. Having your name on a patent s good for a resume.
putting the 'B' in LGBTQ+
Well, Young Developer.
You're going to have to understand the term "work for hire" -- which basically means in most cases when you work for a company and do stuff for them, they own it, and not you.
You might be exceedingly lucky and find an employer who will sign off on that.
But for the most part, your employer doesn't give a fuck about what Young Developers want in terms of ownership of code.
Why would a corporation be paying you to develop stuff for them that you're going to turn around and sell to other people.
Only someone young and new to the industry would be so self entitled as to ask what you're demanding. Because the laws surrounding "work for hire" have been around for decades ... and they won't change just because you deem yourself special.
Most companies will tell you to piss off if you suggest that.
Lost at C:>. Found at C.
I built a generic piece of a larger system that I thought would be a good thing as open source. I convinced my boss that since we were using open source software as part of our big system, we should give back to the community, and he agreed. I organized the source with proper licensing into a package and my boss handed it off to the lawyers - explaining the above - for review. A few days later, they came back and said "no problem, post it". And I did. That was the end.
I suppose some of this depends on how prick-ish your company/boss is, but mine, thankfully, is pretty laid back about this sort of thing.
If you use the employer's resources (however trivial), then absent a written agreement otherwise, the employer has what's known as a "shop right" to use what you produce, even if it was done on your "own" time.
Besides, if you're salaried (as opposed to hourly), there is no such thing as "your own time".
1) Make your software code clean
2) Agree with your manager/HR/Legal dept to release it as free and open-source (that's right)
3) Wait for other developers to use your software
4) Make your own company and get paid for the support
If your software is worth something, you'll be fine.
If not, but still it becomes rather popular, you can put it in your resume and keep selling yourself.
That's for copyrights. Software is an IP ball of wax and more complex.
I am not a lawyer, this is not legal advice. See a lawyer and get some.
Under copyright law, its a work for hire, you are paid to produce software, you produce software on company time, using company resources, for company goals/business. You won't own your copyright in court without a clear statement from the business that you own all copyrights on work you create while working for them AND filing it first with the Copyright Office. Do that second part and you are likely to win even without the first part. See a lawyer.
Your software may have patentable aspects to it. Without filing, none of you own it. Filing behind your employers back may get you sued and any patents granted to you may be awarded to the business. And you may find future employment rather difficult afterwards. Filing with your employer is a sticky issue with many legal twists. See a lawyer.
It sounds like your company's policy MAY cover your work as a limited license to distribute the work. But it also sounds vague as hell and a legal minefield for you should they decide to change the policy. Before attempting to sell anything you produce for them...see a lawyer.
Basically, Slashdot is not the place to ask for advice. this is pure legal here. Take a copy of the company policy you are worried about, take all the company policies you can find that are published, and consult an attorney. Also, and i should not have to say this, make sure you use an outside attorney and not one your company uses, or there is a conflict of interests going there and you may not receive the advice you are seeking.
Work For Hire is what you are doing.
Your company owns the copyright on your work, not you, by default.
Additionally if you *LOOK* at your employment contract you will find that *ALL* the work you do while *EMPLOYED* by your employer is *OWNED* by your employer *INCLUDING* the work you do at while *NOT AT WORK* if the work you are doing is *RELATED IN ANY WAY* to the business your employer is in or *MAY BE CONSIDERING TO ENGAGE IN*.
And that, my friends, *is* in the boilerplate employee contract for pretty much every company large enough to have legal counsel. ... including a 1-5% of the profit if the patent is not used but licensed to other companies.
You will also find a non-compete of at least 6 months, typically longer, regardless if is enforceable. Additionally there is always a patent assignment agreement (note that a patent assignment must also confer some compensation, usually $1 but some companies will offer better deals
Apparently this is a reasonable exchange for a steady paycheck, for some ...
In the absence of a contract the consultant will own the code. All paying for it give you is an implied license, which only includes source code if it is necessary for the normal use of the program (so basically scripting languages or programs where you hard coded enough that you need source code to use it.)
I'm a signature virus. Please copy me to your signature so I can replicate.
As you can't waive your copyright here were I live, my employment contract contains a passage that says I give my employer the exclusive right to make money from the code I write. This implies that I can't sell it to anyone else. You should check your current contract for a similar passage.
Rereading the question, OP works at a company servicing a SAAS for developers to share code and being paid for it; so far so good. OP works on the backend software for this platform, very well as well.
He wants to sell his Code and Ideas, this is fair. But why has he have to do this in company time? In the question this reads as an imperative? Why can't he do it in his free time like everybody else, using the very same platform he has so much insight in?
Would the code he wants to sell be pertinent to the SAAS platform itself? That might be a bad Idea from the company's point of view for sure.
Or can't he produce non-trivial code one could find on Github or somewhere else in his spare time, because of lack of time or energy or of other reasons like having a life? Well that would mean that he'd work on his own projects on company time, something again any company would find a bad idea for sure as well.
OP's situation is definitely not one of a contractor who writes software or modules from scratch or based on an unique skill-set which is licensed out, and he is NOT producing a product or software in itself, but amends to a (presumably) pre-existing (as in existing at the company before he was hired) software in form of (sic) add-ins presumably ordered by the companies' customers in the first place.
I cannot see a company entering a contractual situation with anyone on these premises unless there would be a BIG benefit for said company.
Don't get me wrong, OP might be a gifted, hardworking, very creative Individual, which could be a BIG benefit for the company to keep and give free reign. But then again as a Company I would argue to advance OP inside its structure, giving a fancy job title, higher payment and so on, as this would benefit the company much more than to allow OP to make money independently from the companies software.
My advise to OP, if (s)he sees him/herself to be a rather free spirit is to break free from corporate shackles and try to stand on their own feet, and create great software, of which one might be the next big thing, get bought by a bigger company and help yourself to those nifty shares!
Otherwise find good use with those good ties to upper management and advance yourself inside the company, working towards the better payday and create some great software, of which one might be the next big thing, go IPO, and help yourself to those nifty shares!
its your choice
In the absence of a contract the consultant will own the code. All paying for it give you is an implied license, which only includes source code if it is necessary for the normal use of the program (so basically scripting languages or programs where you hard coded enough that you need source code to use it.)
Nonsense. Any code developed as part of your work on behalf of a client is owned by default by your client in the absence of any other written agreement. It is known as work-for-hire. If the code is generic and not part of their products you can often get permission to distribute the code and retain ownership but it is not guaranteed.
An interesting question, Toney Time. Thank you. Writing this out has helped me clarify some thoughts on the topic that I've been mulling over.
Lots of other posts are kind of knee-jerk in their simplistic responses; they are not necessarily wrong, but they may be incomplete.
For what it is worth, I will give you a silver star for thinking about this before starting to "write your own code"... much better to game through some scenarios now instead of going heads-down for 6 months or a year and running into legal issues).
Another silver star for plausible expectations e.g. not looking for "get rich fast" stuff. (Also it wouldn't hurt to spend a few brain cycles on "get rich fast" stuff; if you have a plausible idea why not go talk to the people at y-combinator).
At any rate, here are some questions for you to consider.
fyi - if you can't find good answers to these questions, that may be an indicator that you want to avoid thinking about good, potentially lucrative, ideas until you're in a position to work on them free and clear.
By the way, not thinking about such ideas includes, but is not limited to: avoiding putting things online (facebook posts, email) or anywhere else it would be discoverable.
1) WHEN ?
Can you clarify when you are doing the additional work?
If you plan on doing some midnight engineering (e.g. unpaid nights and weekends, with "unpaid" being the key word) then you might have a basis to claim ownership of the code.
I'm willing to give you the benefit of the doubt about this being a "employer funded" effort.
2) WHERE?
Where are you doing this additional work?
I make it a VERY clear point to do any of my own midnight engineering on my own personal hardware that NEVER connects to day-job infrastructure. This includes simple research into new languages and frameworks that are just not in use at my employer. So, buy an extra laptop. Rent a cloud instance if you need to. But it just seems like a Bad Idea to code something you want to OWN on somebody else's hardware.
3) LICENSING OPTIONS
Licensing model e.g. what is your release goal? This really is just an aspect of the next item, but seems important enough to be worth calling out separately.
If you just want open source of some kind, that should be easier to negotiate with your employer since they will ostensibly benefit as well. You mentioned "community effort", is the community license suitable for what your long term goals are?
4) PROFIT?
If you want the option to SELL your code, things get more complicated.
Things you need to answer here:
What is your potential market? e.g. How could they pay you, and WHY would they want to? (pro tip: the "why" part is more important than "how").
You can sell code as-is, or services (training, install, support, and integration).
There are a several ways you could go...
a) dual-license (look into what the MySQL kids were doing, see talend.com for similar "free" vs "premium" licensing, or maybe redhat with fedora and rhel).
b) fork (if it is open source, just assert a new version). Long term goals will influence your license choice today.
c) sales drivers. To understand this one, think about your current employer's sales model. How do they find new business (growing work for existing customers as well as attracting new customers)? You might be able to work out a commission on new business your "fabulous website" brings into the company. You might be able to negotiate ownership of said website, and if you ever part company from your employer you could conceivably refer customers to all players in this market space (e.g. where players is the set including your employer and their competitors).
5) EMPLOYEE AGREEMENT
What does your employee agreement say on the matter?
It may already answer the questions asked above. As many other posters observed, "work for hire" is common. I also tend to see "all your ideas belong to us, even the ones you have on
A business I worked for a few years ago was started by someone who did essentially what OP is suggesting. The programmer developed an accounting system for a healthcare related business (which is not an easy task, medical billing in the US is a quagmire). The application actually worked pretty well, and he knew other businesses could use it. So without telling his employer, he stole the source code and partnered with an unrelated business to sell it. The guy ended up quite well off when he retired.
Of course what he did was completely illegal, but this was before the internet so his original employer had no practical way to catch him, nor any incentive to do so since they still had the working application for themselves.
Sure, copyright law may not force you to write it down, but if you violate the employment terms, and are sued, and lose, the remedy might be to produce the documentation.
Specific performance.
How do you understand this to be the case? The OP describes a defacto case of work for hire ip assignment:
Work done at Work ....
Work done on employers assets (cumputers)
Work is inclusive of the responsibilities of the employees role.
I would go as far to say that even having this post and trying to get a lawyer to act on his behalf to secure rights at this point can be shown to seal the fact of the case which would be even the idea for this business was constructed while work for hire was in effect...
Consultants do not fall under work for hire.
If you have one client and they choose your schedule you are not a consultant.
I'm a signature virus. Please copy me to your signature so I can replicate.
You'll have to get another job or sell your solutions, not both. I feel as if you are looking to pull an Uber here. You want to enjoy the benefit of ignoring the rules that inconvenience you while taking advantage of the rules that work for you. The company you work for has invested in making you who you are, a valuable employee that participates in their interest.
You may be able to travel the road of making legal contracts that cover everything but that would probably defeat the purpose of doing it. Unless you cut all ties or keep your work completely separate (different technology, no one at work knows about it) from your day job, there is really no easy way to protect your products. They are quite simply not yours.
For example, I know someone who is an admin by day and has a business renovating houses at night. That is how you protect yourself.
If these ideas are worth pursuing, you should be able to quit and make a go of it on your own anyway.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
The article describes an employee, the post I was responding to was talking about consulting.
These are entirely different scenarios.
I'm a signature virus. Please copy me to your signature so I can replicate.
... quit and work for yourself (and see how hard it is to pay for resources, benefits, insurance, lawyers, etc.), OR realize all the things being employed by a stable company offers you and be thankful.
And no, I don't mean just be happy being a worker bee, but it's a give and take relationship as an employee, and you only want to take.
Seriously, with that attitude, I'd never hire you as you sound like someone with no loyalty and nothing but "me me me" for a mindset.
'The unexamined life is not worth living' - Socrates
Anyway, as there are a couple of people contesting this already I though I would link the actual rules on copyright and work for hire.
http://copyright.gov/circs/circ09.pdf
Note that falling under (b) requires that it pass that test AND there be a contract stating so. The tests in (b) have also been found to be exhaustive, so it MUST fall under one of those scenarios.
This means that even in many cases where there is a contract stating that the party paying for the consulting time owns it, in reality the consultant still owns the code. The only common one where code is not owned by the consultant is when the work will become part of another existing work.
I'm a signature virus. Please copy me to your signature so I can replicate.
90% of replies have been "you'll be fired" or "get an attorney".
The reality is much more complex.
If the owners trust OP, believe he can produce a new line of revenue, or that the company would benefit from OP's entrepreneurial spirit, the owners might offer OP a promotion or a better deal than a standard employment agreement, such as shareholder, partner/founder of a spinoff company or licensee on the IP in question.
If the owners do not trust OP, or see their employees purely from the "employee relationship is the best relationship" point of view (which many corporate attorneys preach) then OP is putting his job at risk, should carefully research the situation and seek legal advice.
I own a corporation (with employees) and an LLC (consultantcy services). I've pushed companies to their limits (was fired once) and built $50 million/year lines of business in 2 years. I've recently been offered equity on two start-ups. So I've seen the point of view of several owners, their corporate attorneys and attorneys who represented me.
Some attorneys who litigate a lot of partnership disputes will tell you "employee relationship is the best relationship" or "never give out equity because it gives others legal interest/cause to sue you". Others will say the opposite, namely "provide incentive with equity or options to breed entrepreneurs within the company". A third group of attorneys will admit that this is a terribly difficult decision filled with trust issues and risks and will suggest a very detailed shareholders/employeement agreement to manage expectations and contingency plans for the partners/shareholders should things not go as planned.
The reality is these matters are potentially very complex. In my opinion everything boils down to the details of the situation and the preferences, skill and experience of those involved, whether it be the preferences/skill/experiences of OP's company's management, owners or attorneys or OP's own attorney. Ask enough business owners and attorneys and you'll get tremendously different responses, just like everything else in the world.
Majority of worker slaves have such positive attitude "I have a good relationship with management" until burned out or not needed anymore. Well, they didn't even notice they and their work are owned. So, a little reality check: a hired man who builds a house does not get the ownership of the house. Or a car. Or an iPad. Making software for hire is no different. Your work should provide a profit for the one who invests in you. If you want the profit you think your work is worth of, quit the job and start your own business.
By "contract", I mean your existing employment contract, and by "specialist", I mean ideally a contract lawyer specializing in labour law.
In every development job I have had, except the last one, the company already had a standard "stuff done on company time and/or using company hardware is owned by the company" clause in the contract, written in such a way that it was enforceable, although depending on your specific local laws, mileage and wording may vary.
Once a good lawyer has seen the contract and told you what, in his/her opinion you are allowed to do, float it by your management. If you can come to an agreement, get them to provide you with a written statement from the corporate lawyers on company letterhead in the form of a contract attachment specifying what the commercial rights to whatever you develop will be. Then get your own lawyer to review that, and everyone signs each page of each copy of the attachment.
In practical terms, you will be lucky if you get anything more than "what you do on your own purchased hardware, in your own time, is yours. Company hardware OR company time, the IP and commercial rights belong to the company.", but whatever you do get, if both sets of lawyers have agreed and signed off on the wording, then you should be safe as long as the rest of your employment contract does not change as well - that is why it needs to be done as a contract attachment, rather than a change to the main body of the contract.
When I started working as a salaried employee doing software development, my employment contract included language to the effect that everything I produced using any company resources, or using internal company information, belonged to them. When you're salaried, you don't really have "your own time", and since they're paying you, most companies would say that your time is another "company resource". I'm not sure how well that would hold up in court, but I'd also expect that most companies could grind their employees into the ground if it came to time in a courtroom.
Realistically, they weren't interested in the little hobby game I was writing (my employer produced business software), so it's unlikely that they'll claim copyright on it. Now, if I developed a new plugin for my employer's product, that's a somewhat more danger-fraught proposition.
What you want is probably some time with a lawyer, and to begin negotiations with your employer for an explicit contract stating that you own copyright on the things you're making, but that you're assigning non-exclusive, but unlimited use+distribution+modification rights to your employer (OK, obviously I'm no lawyer, but I'm sure you get the idea).
You may be on good terms with your employer, but they aren't your friend. They're out to make money off of your work. There needs to be a contract outlining who owns what, what they can do with it, etc. Otherwise, you're opening yourself up for bad times.
It is pitch black. You are likely to be eaten by a grue.
The best you can do is get your company to agree that it is okay for you to put a BSD-style license on it and share it with the community. As long as it not special-sauce kind of code, they may actually agree. I've done this myself.
But don't count on ever making any extra side-money for work you've done on their dime.
I have a more interesting question: We use a lot of open source (mostly GPL- compatible) at work, mostly because I convinced the owner that these are production-worthy software that comes for free and does not get discontinued by some management decision, which was the fate of most of his Microsoft environment. Some libraries I created are pretty generic and can find many new uses if published on GitHub. I can try to convince the owner that he will get free bugfixes and updates for those packages if some other shop/developer finds them useful. There is no direct benefit for him, though. How should I go about it?
Technically you are both wrong and right. Works for hire apply but they do not apply to everything. It is a little vague. This is why most consulting contacts end up with provisos that explicitly state the ownership of ANY work.
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Wrong. It's work for hire it doesn't belong to you.
that company owns the software they paid you to write unless there is contractual language saying otherwise.
It's fairly common for a contractor to have exactly such a contract, otherwise you're making things really hard for yourself when you get hired for a different job, and you need the same piece of code to solve a problem.
When a contractor gets such terms they take a massive cut in pay. Getting rights to the software involves some tradeoff.
I think people are confused. What typically goes into contracts is that contractors get to keep software they *brought* to the job, not new code written for the customer. For example I own software under a proprietary license. I will use that software in client's project. The client gets a license to use that software. I get to keep bug fixes and minor enhancements. Major enhancements for this particular job/client, now we are getting into that gray area and a price cut might be needed to retain ownership.
I was approached by a recruiter recently who sent me the link to his client. Apparently his client has open-sourced the application they're working on, under the Apache license. I appreciated being able to look at their code, and that's an extra incentive for me to consider them. Last company I worked at, I suggested they release a ruby "expect" DSL I'd written under an open source license. It used the Ruby SSH gem, which was not something I'd seen before, and had a syntax similar to TCL/Expect. I suggested it several times and got blown off several times. Basically no one was particularly opposed to it, but no one was actually capable of making a decision in that company. The entire place was an example of institutionalized learned helplessness. I don't think there's anyone left there who has any idea it's even in their version control.
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
1. NEVER sign a non-compete clause.
2. NEVER sign one of those "the company owns any ideas you have" employment contracts.
If you have done any of the above, stop here - you lose.
3. NEVER use any company resources to develop personal projects.
3a. ALWAYS work on your own time. Keep records of this because that is a classic attack a company will use in court after 1, 2, and 3 above.
4. If possible create work that is not in the same line of business the company is in (i.e. if the company makes games DO NOT MAKE GAMES, etc.).
It isn't vague at all, cerberusti is exactly correct and the AC is a maroon.
"Work for hire" means employee. It doesn't matter what you want it to mean; look up the legal precedents. Contractors are exactly what is _not_ "work for hire," it is business to business contracted work. Basically, the opposite of "work for hire."
There is no ambiguity; you have to have an express assignment of copyright for it to transfer. The contractor owns all their own IP. What the client gets is an implied unrestricted license. That gives them certain rights; you can't stop them from using what you made, because they paid you to make it, but that isn't the same as granting copyright. And a copyright assignment that is buried in the contract is actually not enforceable. You have to have a separate document that is only the copyright transfer. You have to have a signature that is just for the copyright, or else it is not expressly agreed to, it is just an unenforceable extra condition. The copyright assignment can require another document to have been signed in order to take effect, though. So that is how it is done, and that is why there is more than one thing to sign when you have a lawyer do this stuff for you.
The funny part, yeah, consulting contracts often do claim to state the ownership, but that isn't a valid place for it, and the contractor actually still owns that code. It doesn't come up very often, though, because if you try to use that to screw somebody over, you'll be engaging in an unfair business practice and that will preclude you from bringing an otherwise-valid lawsuit regarding the matter.
The easy way to remember it if you don't want to learn the details, the copyright designation is based on who the legal employer is, not who paid for the work. Paying for the work just means you have to be allowed to use the thing that was made for you. If you want to also own the copyright, you're buying that separately the same as if it was made for somebody else.
Just wiki "work for hire" before trying to get pedantic and "stepping in it."
But in the article, as an employee there is no way for him to end up with copyright. Even if it was done at home, since it is clearly related to his work, they own it.
My advice for him, if you're not ready to be a contractor, and you're not ready to start your own company, just write these ideas down in a notebook. You're not in the right situation to be writing speculative for-profit apps that take advantage of your employer's platform, because you're also writing those for your employer. If your company actually wants you to do this, they'll give you the documentation you need, but make sure you're really well trusted by management. If you're just a regular Jr developer, don't even ask. Just write your ideas down so that you can think about them more later, and learn about which still look good later.
And that entitles them to every firing of his neurons during that time?
And that entitles them to every firing of his neurons during that time?
Yes, and most likely part of his contract any thoughts related to the company's products and line of business are part of what that salary is paid for. The brilliant idea about the company product you had in the shower in the morning is most likely part of what you are being paid for.
Now ideas completely unrelated to the company's area of business, there *might* be some opportunities there. However a mere business category does not make thing unrelated. A concept for that other area may actually have application to the company's. My previous employer allowed us to describe/define personal projects that when done on our own time and equipment would not be company IP, prior agreement was necessary but easy to obtain. The point remains that unrelated to company business, current or potential, was their call.
When a contractor gets such terms they take a massive cut in pay.
A cut in pay in return for the rights to the code seems reasonable. Whether it's small or massive depends entirely on the circumstances.
What typically goes into contracts is that contractors get to keep software they *brought* to the job, not new code written for the customer
Not for me. All new code, paid for by my customer, is owned by me. The customer gets a license to use it for their business, and I get to use the same code for the next customer. In return for this, they get free access to code I've made for previous customers.
Why would you expect your employer to pay you to work on projects potentially for your own benefit? If you ae working on company time I don't see any sensible employer agreeing to assigning you rights to work that they have paid for.
1) Most employment contracts include off-time ideas that are related to the company's product or line of business. If you pursue such an idea by developing on your own time and equipment the work product is not yours.
2) Only the owner of the software can open source it and in this scenario the developer is not the owner.
3) See 1).
Not for me. All new code, paid for by my customer, is owned by me. The customer gets a license to use it for their business, and I get to use the same code for the next customer. In return for this, they get free access to code I've made for previous customers.
Only a few client's would find those terms acceptable, many would move on to the next consultant.
If you found a niche or a few customers who do accept that then congratulations. You won a lottery of sorts.
If anyone thinks this knucklehead is serious, then they need their head examined.
Captcha: "ruthless"
You are conflating two different yet semantically related things.
"Work For Hire" and "Works For Hire" (sometimes referred to as "Works Made For Hire".)
Work For Hire refers to the actual work done by an employee/contractor that has been designated as falling upon the IP rules of Works Made For Hire.
Works Made For Hire is part of the the IP doctrine of copyright law.
If you are a contractor, and you do not have the money nor legal team to fight off an IP assignation case, you must carefully and clearly stipulate who owns what IP REGARDLESS OF WORKS MADE FOR HIRE. It IS ambiguous, and a contract lawyer will tell you - do not leave it up to interpretation outside of your contract..
I had a contract just two years ago that ran into an issue where the client (and their a**hole lawyer) were getting confused because I was going to provide them a solution that was built off of some code of mine that I owned all of the IP for.
I clearly delineated that they would own the solution, but that they were only receiving a license to use my previous inventions (and here's the part they choked on for a while) and any necessary extensions to my product that were necessary in order to provide them with a solution.
Their lawyer spent weeks arguing that they needed to own the changes I made to my existing product. That didn't happen...
So, as anybody who has dealt with an unfriendly lawyer would tell you - don't ASSume anything. Don't assume they won't be jerks, that they're not idiots, that the court isn't stupid, that jurors aren't stupid, et cetera ad nausem. Make it clear in your contract, as in 'clear to a 4 year old', who owns what, when, and for how long.
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cumputers
don't forget the moanitors!
lucm, indeed.
if i had mod points you'd have them all. unfortunately for you I'm a coward.
http://copyright.gov/circs/circ09.pdf
Seriously it sounds like what you need to do if you really want to make more off your creations is to talk to your employer about selling generalized copies of your software or software components. Negotiate for a price that both of you agree is fair and make sure to have lawyers from each side at the negotiation. I'm seeing this as a way for you to make more money as well as a way for your company to get back some of what they've spent on your salary.
Only a few client's would find those terms acceptable, many would move on to the next consultant.
No, it makes perfect sense for most of them. I do mostly embedded software work. Their business is selling hardware widgets. They just need the software to make it work. It doesn't harm them in the slightest if I use the same code for some other widget for a different customer who's not competing with them.
But even if you were making purely software applications that were going to be sold, it still has many useful components that can be reused for non-overlapping work. It would also be in the customer's benefit if they could reuse such code. It's a similar concept as open source software, but in a more limited scope.
I have 15 mod points to burn (as usual) but nobody else posted a real reference and few people seem to understand how this works... so I thought clarifying it was more important.
I do not really need the karma, but bumping it would probably stop some incorrect speculation based on how people feel it should work.
I was a consultant for a long time, and am now on the other side. I am not a lawyer, but it is my job to understand this, as in addition to anything technical, legal also reports to the CTO.
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I linked the actual rules in a reply to my post.
The way I dealt with this as a consultant was to incorporate my consulting company. That pretty much shuts down any argument over work for hire before it begins. I still occasionally had someone contest it and lawyer up, but they always backed down pretty quickly as there was zero chance of them winning a suit.
I suppose you could try to do it contract by contract, but not only is that annoying for small contracts, it is also still open to debate as transferring copyright is not as simple as having a line in your contract.
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He works there and they get benefit out of it. More than they give him.
So if they fire him, they're out what they get from him.
YOU would cut your nose off to spite your face, because one of those uppity serfs gets ideas they can do things.
What, precisely, are the reasons for firing him other than your ego and overinflated sense of self importance?
They can say "No, you can't use our systems". And he won't. But they won't get anything he worked on, and they could lose him, he'll at least be a bit pissed off and uninspired, so not as productive. So there's absolutely NO upside to saying no, but a small downside. They can say no, though. He hasn't said he is doing it, only how to do it and square it with his company.
They can say "Yes, OK, as long as you don't impact your work or the operation of the system." and they get a happier worker who will be more productive.
If they feel its being abused, they can say no then.
So there's no actual downside other than their control over him is being vacated.
If they're not an arrogant set of arseholes like you, that won't matter.
It enrages you because you LOATHE those peons. They HAVE no rights, they should WORSHIP you for "creating their job".
The fact that without any of them you're fucking unemployed never crosses your egotistical pin head brain.
He has an agreement with his employer. That can be re-negotiated. And agreed to be different. That's what an agreement is.
Alternatively, he can just do the job he's paid to, which isn't this extra work product, and just take the money for the bare minimum necessary work.
After all, the value of the product he'd be working on wouldn't mean better pay or profit share, so why the hell should he offer extra for no payment?
They could agree on him retaining the copyright and them getting a limited license to use it. Or if it isn't going to be something for them in their market, just the right to a cut of any sales he makes.
This is correct. Anyone claiming that you can work for a company - paid by the hour - and own ANY rights to the product of your work is full of BS. Sure, if you can negotiate a contract that says so, the do it. But absent that written agreement all work is for-hire, and there is AMPLE common law that follows that principle.
"Somebody has to do something. It's just incredibly pathetic it has to be us."
--- Jerry Garcia
You can believe that all you want, but unless an employee wrote the code or you have a correct copyright assignment you would almost certainly lose in court.
A correct copyright assignment is not as simple as having a clause in the contract specifying who owns the code, even many lawyers do it incorrectly.
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If you still don't know anything, become a BS artist and charge higher fees.
WTF man - first of all you do not understand what it means to hold own the rights. I don't know which jurisdiction you are reffering to - I assume Murrica since everybody else would state that (not assuming that Murrica is the only country in the world). Second of all you don't get what the rights are - if you have written some code that is you who have written it and in sane juridictions that can't be changed (nobody else can claim he/she is the author). Monetary profit (licensing) is a different deal but you haven't stated exactly which rights you wan't to keep.
Going further... when you write software as an employee of some company it is assumed that you are licensing it - that is the law in Europe. If you are coding for your employer that basically means he holds the monetary rights to it (you are still the author). That is the sane default.
Now I don't know if it is suitable in your case but I would call for BSD type license - that way you will get your monetary rights for the software (as you can take it and sell it somewhere else). But this is not the "default" and you should talk about it with your employer.
In my experience even if your boss doesn't care often they aren't willing to put any effort/burn political capital to get the higher ups to approve it. Your mileage might vary.
For example my last job I made a utility that talked to a vendors software and collected some data we needed to comply with government regulations. That vendor knew of another site that needed the same software and wanted to buy a copy from us. Anyways, the employer (a hospital) even had an IP consultant come through to see different projects that might be commercializable come through. After a week or so of onsite interviews, filling out the invonvation paperwork (forget what the proper term was for it), having a customer already lined up etc etc. Still couldn't convince my boss to chat with his boss to get it to go forward. He didn't seem to mind the idea, but also no one wanted to own the liablity if something went wrong, wanted the hassle of figuring out who gets paid what (unlike the US in my country the employee owns the IP of the stuff they create unless explicitly assigned in their employee contract (I wasn't hired as a software developer/had no ownship transfer in my contract)). Anyways, I could of just tried doing it on the side but would have all the hassles of a business including significant liablity exposure should something break. Also wanted to keep it internal since I'd already been paid to make the code/didn't want to piss of my employer. Still: can be an upward battle: pretty much by definition anyone working at a government job/for someone else doesn't want the hassle of dealing with all the business processes themselves (you might like sales but hate legal, might like product development but be antisocial, etc, few people enjoy the whole process).
This is called Having Your Cake and Eating it. If you were my employee and you asked for that. Once I had finally picked myself up from the floor in total shock that someone would have the arrogance to ask for what you are asking, I would then fire you.
You can claim the law is BS all you want, but it would be inadvisable to take that position in court.
If it is an employee paid on a W2 who shows up at the office every day and has their tasks and schedule set by the employer, the employer owns the copyright.
If it is a contractor paid on a 1099 who uses their own equipment at their own location, the contractor owns the copyright (even if there is a clause in their contract stating otherwise.)
If it is somewhere in between a court would decide if they are an employee or an independent contractor.
http://copyright.gov/circs/circ09.pdf
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Sorry to break it to you kid, but you signed the contract and sold your soul, the law says they now own you and everything you produce. Your chances of getting them to give it back to you volunatirly are about zero squared.
Welcome to capitalism. You're going to hate it :)
If you are developing software during your boss his/her time, the rights belong to the company, it's THAT simple.. You even have to be cautious if you are a software developer at work and create other software at home, make sure you have an arrangement in your contract about that, because if you don't and you have a very nasty boss, he can claim right to your software you build at home (because you certainly would have thought about it at work, and sometimes even used algorithmes/structures developed at work)..
So if you want to own the right to software developed at work, you'll have to specify that in your contract, but I can almost guarantee you that no boss will do that... And the same goes for software created for a client, make sure the contract specifies who the rights have..
You must be very naive if you think you can own rights to software/algorithmes created at work...
But in the article, as an employee there is no way for him to end up with copyright. Even if it was done at home, since it is clearly related to his work, they own it.
What he does at work, is clearly employers property. What he does at home - not necessarily. Perhaps he don't have a no-competition clause, so he can have another (part time) job of the same kind. For some other company - or for himself. Making the same kind of software.
But he can obviously not sell the stuff he makes at the employer site.
Incorporation provides no shield whatsoever, at least in the US. They can still sue you into bankruptcy.
What you want is to spell out in the contract that anything you provide is an "instrument of service" and that it cannot be distributed, modified, blah, blah, without your permission.
And yes, you need a contract for each and every single job you do, no matter how small. There's always the chance that you will have an insane client (like I did) who ran up nearly a million dollars in costs arguing with us, and then ended up paying a quarter of that, when we calculated the original remedy would cost $1,800. And yes, the client was insane, absolutely bonkers. And I had bought that job from another company that we purchased, and they did not have a strong enough contract, and the job was tiny, about $4,000.
Being incorporated does absolutely nothing for you to protect you from that.
Easy: quit your job.
When you're doing work-for-hire, the payer owns the rights to what is produced. Plus the SDK for that SaaS system may contain poison pills to foil you're plans too. So if you can't get an agreement in writing, forget it. And see a lawyer, if you should happen to make a buck off this your employer and the SaaS co any will swarm you got their cuts.
You are crazy to argue that a contractor paid for their time to build something, without any risk, owns the product.
Without something in writing the comissioner of the work owns it, plain and simple.
What a strange point of view you have. Incorporating does a few things for you:
1) It prevents you from being personally liable if you get sued (although there are some additional limitations on this if you are a sole proprietor which do not affect corporations with multiple owners, and if you do something illegal they may be able to pierce the veil and go after your personal assets anyway.)
2) If someone tries to claim work for hire, the judge will dismiss the case immediately (it never applies between two corporations.)
3) Formerly, it meant clients did not need to send you a 1099 (although I believe this has changed.)
4) It cuts down on those asking you to sign an employment contract as part of your consulting work, as it is obviously inappropriate (needing to tell clients no less frequently is good.)
5) It allows you obtain an EIN and hire others.
6) A bunch of other minor things I am not going to bother listing.
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Also, I would not bother with a contract for a small amount, especially if I had already worked with the client.
If it went over 5k I would most definitely require one before I continued. No way would I let it get up to 1mil, that would be stupid.
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Yes, any contractor who has any idea of what is at stake should incorpate as a Chapter S at least.
Ignoring the huge tax advantages that comes with a Chapter S, it is the most protection for the least amount of effort.
If you're doing it full time, or you make at least $20k/year in income from your contracting, it's crazy to do anything else - it more than pays for itself. That $500 tax prep bill is worth every penny I saved by claiming capital gains on distributions.
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Google "Piercing the corporate veil".
And yes, I've owned LLCs, S-corps, and others. Right now I work for two LLCs both of which I own, as well as a full time job for a company.
You generally need to do something pretty heinous for a court to pierce the veil.
What the hell do you do that is is common in your life?
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As I said, a niche. I've been there too. Doing the firmware to initialize standard components (various cpu tables, ram refresh, timers, i/o, etc) on powerup and offering a hook for proprietary software to take over. Yeah, they don't care about the hardware initialization, however if involved in the proprietary app specific stuff they start to care beyond something exceptionally generic like remote logging.
More importantly you seem to be referring to what I already described. Bringing your own software to the job and being allowed bug fixes and minor enhancements. Once we get into app and business specific stuff the rules usually change.
Will make sure that your contract as a consultant or otherwise is work-for-hire, specially to clear up any misconceptions about ownership. They are paying for your time to build it, they own it. Period.
If you want to own the software, quit and finance the time yourself. Then realize just exactly how hard that is when you have bills to pay and you'll appreciate the value of your time and it's cost. If somebody hires you to build a house, they own it. Doesn't matter how much you think you could get for the house if you sold it...you were hired to do a job.
This is one of the hardest things for programmers to get. You want to build something and make money on it, finance your own time. What you are talking about is no different than going to work for a service company and deciding to leave and take the clients you service with you.
Do it on your own time with proper contracts and agreements to do it the right, proper and legal way. Not rocket science.
Long ago to my shame I worked for lawyers for a while.
I found out big software companies passively track their former employees for years after they leave employment.
If and when the former employee comes up with anything remotely profitable, they have the lawyers send out a dunning letter threatening enforcement of the language in their old employment contract that gives perpetual rights to anything thought about while employed. Often that works.
It's kind of like patent trolling, for employment law.
The author is the copyright holder unless it was an employee (which in the vast majority of cases comes down to if they are paid on a W-2 or not.) Under very limited circumstances which are explicitly enumerated in law, rarely apply to programmers, and which require written acknowledgement, it can sometimes apply to contractors.
Usually even if there is a contract stating that the commissioner owns it they do not, and the contractor is still the copyright holder. You must specifically transfer the copyright in question to change ownership (a line in a general contract will not do this.)
You do not need to take my word for it though, I linked you a clear and concise explanation by the copyright office (http://copyright.gov/circs/circ09.pdf)
There is also the actual law: https://www.law.cornell.edu/uscode/text/17/101
And a supreme court decision from 1989: http://en.wikipedia.org/wiki/Community_for_Creative_Non-Violence_v._Reid
You can stare at that in disbelief all you want, but it does not change the facts.
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If you are one of those cheap shops who illegally classifies employees as contractors to save a few bucks, externalize costs, and avoid employee protections you may want to reconsider that.
It is not zero risk for the contractor.
If they get hurt there is no workers comp, if you fail to pay there is no wages commission (they need to sue you on their own dime), they do not get sick days or vacation, limitations on hours worked, overtime, they pay the self employment tax, provide their own equipment, and generally do not get any of the benefits an employee would get.
The other side of that is that they own their work, and you must generally negotiate with them as if they are another corporation. The fact that most contractors are not aware of this may save you, or it may be that you just have not irritated them yet, and they will come back later to own your product and collect damages for your violation of their copyright.
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Always get a contract that stipulates the deliverables. It controls the liability and helps insulate against lawsuits.
Architectural plans are like computer source code with a couple of differences: You only compile once.
Ok, some follow up questions (and comments) for ToneyTime:
1. Are you a contract employee, wage employee or salaried employee, i.e., did you fill out a W-9 or a W-4 when you started working for this company?
-- If you filled out a W-4 you're a salaried employee, STOP! you're dead in the water trying to claim IP rights for something being done with company resources and/or on company time and risk getting not only sued, but blackballed in your chosen career as word WILL get around about what you've done if it reaches the courts or even the news
2. Was there a non-compete clause in your employment contract (W-9 or W-4)?
-- If you replicate the functionality of code created for and being used by your employer and intend to sell that same functionality to others YOU WILL BE SUED
3. Are you out of your mind or unbelievably naïve?!?!
-- To even think you could take company resources and (re)create features for software that the company uses to make money while employed at that company and on company time is absolutely ludicrous. Why don't you ask to have sex with your bosses wife while you're at it, as it makes as much sense as what you're asking.
So, no, you cannot do what you're asking. If you're a salaried employee of a company doing software development, they most assuredly own the code and the rights to it if it's developed for them and relevant to the work you do on a daily basis. What that means is if you create ANY software that does what the company software does you're done, and I mean fired, sued and might not ever work again as a developer. Again, if you create anything relevant to what you do for the company, or related to what the company does you will be sued if you are full-time salaried employee of the company. It's called conflict of interest, among other things depending on your employment conditions/contract. You can most likely create unrelated software products to your hearts content, but once you cross the line of any code created for the company or related to their business you're painting a great big target on yourself.
It sounds like you're a young kid. It would be a shame for you to waste your talent by doing something unethical and end your career early.
2) If someone tries to claim work for hire, the judge will dismiss the case immediately (it never applies between two corporations.)
So if I hire a web development company to create a website for me and they sell it to my competitor as soon as
they get done then that's fine because we are both corporations and it's not "work for hire"? Just because
you are a contractor doesn't mean you automatically get to keep what someone pays you to create.
There is some gray areas when it comes to libraries, etc... and those should obviously be agree upon as the
issues come up but you don't own something just because you made it. That's like saying I own a painting
or book because someone paid me to paint/write it for them. Yes, you're still the author but you sold your
rights when you gave it to them and got paid. You can't turn around and sell unlicensed copies of that
painting/book to other people. Musicians have been sued for this exact thing.
...it is clearly stated in Your contract that everything You do is owned by the company You work for. Learn to read, dude.
and. btw. the same may be true for consultant contracts.
You're going to get fired and/or sued the way you're going. You may have a great relationship with management. How's your relationship with the investors for the company you're at now? They're who will eventually come after you if you start selling company software on the side (you may get your management fired along the way too). You can quit or you can wait for someone to fire you. Waiting to get fired may get you unemployment benefits, but you'll lose more of your work along the way.
Ok, a third possibility: if you really think there's uncaptured value in the software you're writing, try to sell it from within the company. You know, be a good employee and try to make your company money. (Don't be an idiot, ask for more salary and stock tied to performance of your software.) If you can't convince your management that you're on to something... then you can have discussions about buying the rights or maybe you should re-evaluate this whole idea.
when posting this type of stuff.
A consultant doesn't own anything he writes while being paid by the company. It is generally clearly written in the MSA and only a company that has no clue to what it is doing will let the consultant keep the work he makes while being paid by that company. If I was a business owner, I wouldn't care if I had absolutely no reason to keep the code, I would still keep it out of principle. If you want to keep your code, foot the bill and write it on your own dime and time. Then come and sell it to me like any other software vendor sells their product. I am not going to pick up the expensive development costs for you.
So if I hire a web development company to create a website for me and they sell it to my competitor as soon as they get done then that's fine because we are both corporations and it's not "work for hire"?
Pretty much. Like when you 'buy' a copy of Office, MS is allowed to turn around and sell it to your competitor. That web dev company has probably created a website for you based on a template they've used a hundred times before, adjusting the details and content for each new client, so they have - for the most part - sold you a web site that they'd already sold to one of your competitors. This is why it's important to spell out the ownership and rights to works created under contract - code, art, text content.
Generally, if you're salaried, and its written during business hours and/or using company resources, the company can claim ownership.
You should also check your employment contract. Most of my jobs have had clauses claiming ownership of "all creative works" with specific caveats about work done on the clock and/or using company equipment in order to get around states with lax/ambiguous ownership laws.
Best advice is to speak to a lawyer. At least, speak to management/HR about what you want to do and get written approval.
I made a pretty good living for about a decade doing almost exactly that (although mostly those were not web sites.)
I would get paid to write all of the software to run their business, then go around to their competitors and sell it to as many of them as I could. I determined pricing partially by how many people I thought I could sell it to.
For an example that is not programming, look at the articles that get reprinted on Wired, Ars, and a bunch of other sites. This happens because the author owns the work. While Wired may pay someone to write it, the author is absolutely within their rights to then go shop it around to other sites.
If somebody pays you to as an independent contractor to write a book or produce a painting you own it. The person paying only gets a copy of the work, not the copyright.
I'm a signature virus. Please copy me to your signature so I can replicate.
It is not even possible transfer copyright by a clause in your consulting contract.
I was willing to sell the copyright in some cases, but would charge a far greater amount if you wanted to buy the copyright from me. Even buying a license for source code would increase that bill by at least 3x.
Usually it would be cheaper to hire someone if you need the copyright. It would be a little bit strange (and terrifically expensive) to use consultants for that.
I'm a signature virus. Please copy me to your signature so I can replicate.
... get used to saying, "Do you want fries with that?" because you're not gonna be employed for long.
BULLSH1T
That depends on the law in the jurisdiction you're in. In Minnesota, I have copyright on anything I do that's outside work hours, not using company equipment, and not related to what my employer does. Any agreement to the contrary is void. This doesn't apply to the situation in the summary, where the person wants to keep copyright on something that is part of the business, but it shows that an employee can automatically retain copyrights or patents on his or her independent work.
Everything else is work-for-hire, since I'm a regular employee, and my employer has copyright on all the code I write.
"When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes
It isn't vague at all, cerberusti is exactly correct and the AC is a maroon.
"Work for hire" means employee. It doesn't matter what you want it to mean; look up the legal precedents. Contractors are exactly what is _not_ "work for hire," it is business to business contracted work. Basically, the opposite of "work for hire."
There is no ambiguity; you have to have an express assignment of copyright for it to transfer. The contractor owns all their own IP. What the client gets is an implied unrestricted license. That gives them certain rights; you can't stop them from using what you made, because they paid you to make it, but that isn't the same as granting copyright. And a copyright assignment that is buried in the contract is actually not enforceable. You have to have a separate document that is only the copyright transfer. You have to have a signature that is just for the copyright, or else it is not expressly agreed to, it is just an unenforceable extra condition. The copyright assignment can require another document to have been signed in order to take effect, though. So that is how it is done, and that is why there is more than one thing to sign when you have a lawyer do this stuff for you.
The funny part, yeah, consulting contracts often do claim to state the ownership, but that isn't a valid place for it, and the contractor actually still owns that code. It doesn't come up very often, though, because if you try to use that to screw somebody over, you'll be engaging in an unfair business practice and that will preclude you from bringing an otherwise-valid lawsuit regarding the matter.
The easy way to remember it if you don't want to learn the details, the copyright designation is based on who the legal employer is, not who paid for the work. Paying for the work just means you have to be allowed to use the thing that was made for you. If you want to also own the copyright, you're buying that separately the same as if it was made for somebody else.
Just wiki "work for hire" before trying to get pedantic and "stepping in it."
But in the article, as an employee there is no way for him to end up with copyright. Even if it was done at home, since it is clearly related to his work, they own it.
My advice for him, if you're not ready to be a contractor, and you're not ready to start your own company, just write these ideas down in a notebook. You're not in the right situation to be writing speculative for-profit apps that take advantage of your employer's platform, because you're also writing those for your employer. If your company actually wants you to do this, they'll give you the documentation you need, but make sure you're really well trusted by management. If you're just a regular Jr developer, don't even ask. Just write your ideas down so that you can think about them more later, and learn about which still look good later.
We had a bank in Canada that outsourced it's IT department (operations and development). After a few years of rising costs, and security concerns, they wished to repatriate their IT department. Well, they did receive the data centre, and their hardware/network, but the contractor owned the code, and the bank was up SCHITTS creak (www.cbc.ca/schittscreek/). They were forced to retain software development with the contractor.
Leslie Satenstein Montreal Quebec Canada
But in the article, as an employee there is no way for him to end up with copyright. Even if it was done at home, since it is clearly related to his work, they own it.
Not so, and I say this as someone who, as an employee, has wound up owning large chunks of project code outright.
The key is... ASK FOR IT.
Seriously, it can be that easy. I worked as an employee no a specific project for a company's internal use, but I saw it could be more generally useful with a few tweaks. When the project was canceled for budgetary reasons, I simply asked for the code. The deal we struck was that I owned the code, they retained a non-exclusive license to use it and future enhancements, if any were produced. They put it in writing (a letter of assignment doesn't have to be complicated at all) and I went back to contracting.
While contracting, I've occasionally run across a contract here or there that contained an ownership clause. I've always struck through it, while explaining that a great deal of my value comes from the experience i've gained at prior engagements; and that this translates directly to less effort for me and shorter deadlines for them. If they wish to own the code, then it is with the understanding that I would have to expend additional time and effort to re-code some very effective algorithms from scratch to meet their IP requirements. I raise my rates and time estimates accordingly.
Given the economic costs and rationale, I have never had a client push the issue. If they did I'd shrug and pocket the extra money. If they didn't want to pay more for exclusivity, then I walk away, as it is 100% assured that they WILL have other issues that will make you regret ever dealing with them. Not every contract is worth landing.
You'd have to get your current employer to hold you, your subsidiaries, associates (fill in a bunch of stuff here) harmless forever. See a lawyer. Good luck with that. For practical purposes they can always say you had a copy or benefited from what they paid you to do. Could also wait say 5-10 years. That often helps flush things. They can still come after you if you suddenly have lots of zeros in our accounts.
Life is like that. Take a chance. This could be your first bankruptcy. Learn and go on.
Wait... are you a sole proprietor trying to pay yourself with capital gains distributions?
If so, may I advise you to seek out a tax attorney in order to consider a settlement with the IRS where you go to them, and stop doing that right now before the IRS comes after you (you may get lucky, but they have 7 - 10 years to come after you, and they tend to do it towards the end.) I tried to do that for a while, and it cost me far more than I saved in taxes.
It is not legal, even with a couple of people in the business. You still need to pay the self employment tax and pay yourself as an employee.
Another piece of free advice is that CPAs are more frequently shady than not, but it is your ass on the line and not theirs.
I'm a signature virus. Please copy me to your signature so I can replicate.
Looking a little bit more, it is not even 7 - 10 years. There are cases where the IRS did it after 30 and seized everything a retiree had (including garnishing social security.)
I'm a signature virus. Please copy me to your signature so I can replicate.
My experience as a consultant was similar.
Occasionally I had someone who wanted to own everything because they were paying for it, but once I factored in the extra time to write a clean implementation of everything required, and my increased rate for time I would not derive any other benefit from they usually reconsidered their position and took my original proposal.
The ones I had problems with were always one of my salesmen agreeing to something extra without talking to me first. I penalized them heavily in other ways on the few occasions where that happened, but still needed to technically fulfill the contract (to the detriment of everyone involved.)
I'm a signature virus. Please copy me to your signature so I can replicate.
I am a lawyer, but this is not legal advice. If you want legal advice from me, pay my retainer. If you get your legal advice from slashdot, you deserver whatever happens . . .
Anyway, I've read much of the below. If you are in this situation, and it's not worth paying a lawyer who practices in this area, what you're doing isn't that important.
I don't work in IP at the moment, but there is enough misinformation below to keep several lawyers busy.
There is a reason for hiring a professional programmer instead of doing it yourself. Similarly, there is a reason to hire an actual lawyer rather than misinformation of the internet . . .
hawk, esq.
The submitter already stated that he (or she? I didn't notice. Damn you, English and your lack of implicitly gendered verbs!) is young, so they don't have that option available to them. Also, being young, they know that those rules don't apply to them.
Let him or her enjoy the cluebat of growing up in peace.
Birds are not dinosaur descendants;birds are dinosaurs, for all useful meanings of "birds", "are" and "dinosaurs"
Basically, you are asking how to get your employer to pay you to earn more money. I see a few options, for best to worst
1) negotiate to become a contractor for the company, selling them the products that you are programming. I know you don't want to be a contractor at this time, but it's really the only clear way for you to retain ownership of your code, and even then it has to be in writing that you retain all property rights to the code you write, and they are purchasing a copy of the program, module, plugin, or whatever.
2) if you have other job fucntions, and this is only a small subset of your work, and you are really on good termss with the employer, you could try to get your jub descriptiong to exclude this work, and then do the programming on your own time, and sell it to your employer. Don't expect them to pay you per hour to develop products that you are going to sell to others! The best is to quote per project, and offer them a reasonable price for product, and hope to make profit by selling to others.
3) come up with a buisness plan for the company you work for to help them sell your code to others, and pay you a commission on sales. At least this way you are asking them to consider giving you a bonus if your idea makes them more money. Still, you are asking to be paid more for what they are already paying you to do.
4) Any other agreement you could reach should be shot down immediately, as you are asking them to pay you to develope something that you wish to sell on the side.
I recently made the switch from being an full time employee to a contractor. Since I was designing custom software for the company, the boss agreed that I would be exempt for the non-competition contracts that I signed when I was hired, but I still can not use the code that I wrote for them as is. I can sell the same software, but I have to rewrite it from scratch.