Whose IP
is it anyway?
Luke Moulton (associate) of Wright Hassall explores the ownership of key intellectual property
rights, as well as confidential information, and practical steps to protect these rights
question? If so, the employer would own
the intellectual property.
Whether the employee created
the work during the course of their
employment is assessed by various
factors, including:
● the employee’s job description
● whether the work done is of the kind
of work that the employee was employed
to do
● the time the work was created and
the source of the materials used – was
this during or outside working hours and
using materials owned by the employer.
Notably, the time of creation is not
a conclusive factor. The fact work is
done outside normal working hours may
not mean it is not done in the course
of employment – there is no clear
demarcation of hours of work for many
employees today
● whether there is any agreement
between the employer and employee.
For every IP right (other than patents), it
is possible for an employee to enter into
an agreement that transfers ownership
of past, present and future IP to the
employer. This is typically found in an
employment contract.
CONSULTANTS
Notably, the position differs for
consultants. A consultant is
independent, so unless there is
an agreement to the contrary, the
consultant will be the first owner of the
IP and not the company who engaged
him or her.
The only exception to this is for UK
design rights for designs created before
1 October 2014, because in these
cases the commissioner of the design is
All types of businesses, from
large-scale R&D companies
to a family-owned furniture
manufacturer, deal with
intellectual property (IP). In carrying
on commercial activities, many
businesses rely on their employees and
consultants with whom they contract.
Whether those commercial activities
include researching and developing
new products or manufacturing
processes, or creative endeavours, IP
will be generated. This could be the
business’ competitive advantage, and
failing to protect it could have serious
adverse consequences. Two key issues
therefore arise in relation to the IP that
is created: (1) who owns it? and (2) how
should it be protected?
EMPLOYEES
Broadly speaking, in the context
of the employer-employee
relationship, the law favours the
employer. The general rule is that
an employer will own
IP that is created by
employees during
Luke Moulton
the course of their employment. This
general rule is contained
within the various statutes
that govern IP rights.
Furthermore, for any
inventions which are patented,
an employee
may be
entitled
to statutory
compensation if
the invention delivers an
‘outstanding’ (that is, more than
substantial, significant or good)
benefit to the employer.
For each IP right, the
creator must be a person
employed under a contract of
employment and the work
must have been created in
the course of employment.
In other words, was the
employee employed to
do the kind of work in
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