Protecting ownership of employee-created intellectual property

The issue of ownership of intellectual property created in the course of employment has become increasingly important to employers particularly as employees become more and more involved in the innovation processes within organisations.

While this issue can arise in respect of any type of intellectual property, it most commonly does in respect of copyrighted works, for example, manuals, opinions, computer programmes and databases created by employees.

Section 22 of the Copyright Act of Jamaica states, "the author of a protected work is the first owner of any copyright in that work unless there is an agreement to the contrary."

Copyright relates to artistic creations such as books, music, paintings, films, computer pro-grammes and electronic databases. Copyright in literary, dramatic, musical and artistic works lasts for the author's life plus 50 years.

Owners of copyright can prevent other persons from copying their artistic creation.

Unlike patents and trademarks, there is no registered system of copyright in Jamaica. It is deemed to automatically vest upon creation.

There are no forms to fill in and no fees to pay to get copyright protection.

POOR MAN'S COPYRIGHT

To help protect your copyright material, it is advisable to mark it with the © symbol, the name of the copyright owner and the year in which the work was created.

Although this is not essential, it will let others know the date of first creation as well as the creator.

Additionally, a creator could mail the copyrighted work to himself by registered mail, leaving the envelope unopened on its return. This is commonly referred to as the 'poor man's system of copyright'. It is important to note that this does not prove that a work is original or created by you. But it may be useful to be able to show the court that the work was in your possession at a particular date

The term author in relation to a work means the person who creates it. For example, the author of a novel is the person who writes it; for a song, it is the person who composes it.

Copyright initially belongs to the author regardless of any employment or commissioning relationship. Unlike other jurisdictions such as the United Kingdom and Canada, there is no exception to this rule where the work is created in the course of employment or by commission.

Even though the first legal owner of copyright is the creator, it is possible that the employer may be considered by the courts to be the beneficial owner of copyright and therefore entitled to legal ownership if there is found to be "an agreement to the contrary".

An agreement may be implied from the circumstances surrounding the creation of the work. For example, if an employee is asked to design a logo for the company, for use in its business and trade, the court may be inclined to infer that there was an implied agreement or understanding that the company would have exclusive right to use and copy and exploit any logo created.

It might sometimes be possible for an employer to argue that he is the beneficial owner of copyright, but it is more prudent for copyright, and IP issues generally, to be dealt with as part of the employment contract so that everyone knows where they stand.

A precisely drafted employment contract is one of the most useful tools that an employer/company can use to protect its business and, in particular, to prevent employees from misusing and exploiting its intellectual property.

The employment contract sets out the rights and obligations of the employer and the employee and will govern the conduct of the parties during the period of the employment relationship and possibly, after the relationship has ended.

An employment contract might be compared to a prenuptial agreement: both are entered into with a positive spirit but as soon as the honeymoon period ends — which is often sooner than expected — both can be relied on in times of crisis to provide protection and recourse to the 'injured party'.

There may be circumstances where an employee has created work that the company needs to use but the employee no longer works with the company or the employment contract does not provide the employer will own the created work.

In such a circumstance the company will have to obtain authorisation from the employee or former employee to use or buy the work.

This would usually be done by way of securing a licence or assignment between the employer and the copyright owner which would address the terms and conditions for the use of the work.

An assignment is a document that would operate to transfer ownership of copyright from one party to another.

As a result of an assignment, the assignee stands in the shoes of the assignor and can deal with the copyright as if he were the creator or author of it.

The Copyright Act requires that a transfer of copyright by way of assignment is not effective unless it is in writing and signed by the assignor. A licence is simply permission to do an act that would otherwise be prohibited without the consent of the owner of the copyright.

In contrast to an assignment, where the assignor relinquishes all interest in the copyright, the licensor retains the legal interest in the copyright. Licences may take many forms, from one-off permission to an exclusive licence. They may be limited geographically, temporally and in relation to specific modes of exploitation.

GOLDEN RULES

There are three 'golden rules' to avoid disputes with employees:

1. Put written agreements in place: Have written agreements with employees that address the issue of ownership of intellectual property rights to any material created by the employee. The agreement needs to address whether ownership will automatically vest in the employer or if it will vest after a certain time period after creation, whether the employee is to be compensated for the work created, whether and to what extent the employer has the right to exploit and modify the work, etc. It is important to have written agreements in place before the work has started, this will ensure that the issues outlined above are ironed out even in respect of works-in-progress.

2. Implement internal policies and guidelines on employee creations: Corporate polices on intellectual property created in the course of employment should address issues such as the employee's obligation to inform the employer of any work created; non-disclosure obligations connected with such works created; scope for remuner-ation for employee; assignment of the work created to the employer; and the waiver of any moral rights to the work.

3. Seek legal guidance: Ensure that your legal advisers review and where applicable draft all legal contracts with your employees. This is important to ensure that the intention of the parties is accurately reflected in writing and the intended legal effect is achieved.

Sanya Goffe is a partner at Lex Caribbean, Attorneys-at-Law.