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Who Owns What When a Copyrighted Work is Created in the Workplace

Something employers, employees and contractors don’t often consider is the ownership and attribution of copyrighted property created for an employer on behalf of an employee. Copyright has value, so the ownership of it might sometimes come into dispute. Clear agreements as to the ownership and attribution of intellectual property provide insight – i.e., any works created by an author as a result of the course and scope of that author’s employment with a company are company property. What happens, however, when a clear agreement isn’t in place? Who owns the intellectual property then?

The answer is fairly simple most of the time in the employer/employee context – copyrighted work created within the scope of an employee’s job is considered the property of an employer. This is called “work made for hire” under the U.S. Copyright Act of 1976, and no written agreement is necessary to delineate ownership. For instance, a talented and successful visual artist who also works creating visual displays as an employee of a grocery store has no copyright ownership in the displays created for the grocery store, but she does keep her copyright interest in works not created as part of her employment. Attribution is straightforward as well – the employer is considered the author in all work for hire.Copyright Word Cloud

Things get a little choppier, however, when there isn’t a clear employer-employee relationship. Independent contractors can create copyrighted works on behalf of another, and unless there isn’t a definitive agreement that the work is a work made for hire, the contractor may retain some ownership rights in the work. The work will be considered a work for hire and owned by the client of the contractor if it is “a work specially ordered or commissioned for use as a contribution to a collective work, as a part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire.” (17 U.S.C. § 101) This language proves limiting for what can be considered a work made for hire in an independent contractor-client relationship. For example, a grocery store commissions a talented artist to paint a mural for the store. In the agreement for the commission, it states that this work is a “work made for hire” and the grocery store client expects ownership. However, the mural arguably doesn’t fall into one of the nine codified categories necessary, so the work is likely NOT a work made for hire and the artist still retains copyright interests – mutual agreement alone is insufficient to make the work a work made for hire. Nevertheless, it is important as a contractor to read any agreements with clients carefully to determine ownership of any property.

One last point to consider is that the line between employee and independent contractor is not an indelible one. The Supreme Court set out certain factors in the case Community for Creative Non-Violence v. Reid that provide guidance as to the difference between the two, such as how much control the employer has over the work, over the employee, and what status the two parties have vis-à-vis each other. This is a crucial distinction – as noted above, employees will always create a work for hire when it is in the scope of their employment, while independent contractors have far more limited circumstances where this is true.

For more information on intellectual property and the employer-employee relationship, please contact the attorneys at McBrayer.

B. JohnsonBrandon K. Johnson is an Associate in the Louisville, KY office of McBrayer, McGinnis, Leslie & Kirkland, PLLC. Mr. Johnson practices primarily in the areas of insurance defense, employment law, and general litigation. He can be reached at bjohnson@mmlk.com or at (502) 327-5400.

This article is intended as a summary of state and federal law and does not constitute legal advice.

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