What Is a IP Assignment?

Plain-English Explanation

An IP Assignment clause is a part of a contract that deals with intellectual property, or IP for short. Intellectual property includes things like inventions, designs, logos, and even written content. When you sign a contract with an IP Assignment clause, you agree that any IP you create while working for a company belongs to the company, not you.

This clause is common in employment contracts. It means that if you come up with a new idea, design a product, or write something as part of your job, the company gets to own that work. Even if you create something outside of your normal job duties, if it relates to the company's business, it might still belong to them.

The IP Assignment clause helps make sure that the company can use, sell, or change the work you create without needing your permission. This can include things you make during work hours or sometimes even outside of work if it's related to your job.

Why This Clause Exists

Companies include IP Assignment clauses to protect their business interests. When employees create new ideas or products, those creations can be valuable to the company. By owning the IP, the company can ensure that it can use these creations to make money or improve its services without any legal issues.

Another reason for this clause is to prevent disputes over who owns the rights to something created during employment. If an employee leaves the company, the company doesn't want to worry about whether it can keep using the work the employee did. This clause helps avoid confusion and potential conflicts over ownership.

Common Risks to Watch For

• The clause may be too broad, covering work unrelated to your job.
• It could include work done outside of work hours or off company premises.
• The clause might not clearly define what counts as "related to the company's business."
• It may not specify what happens if you create something using your own resources.
• The clause could require you to assign rights to future creations, even after leaving the company.

Example in Plain English

Imagine you work for a tech company, and you come up with a new app feature while at work. Because of the IP Assignment clause in your contract, the company owns that feature. Even if you designed it at home over the weekend, if it's related to your job, the company can claim it. They can then use it in their products, and you won't have any ownership rights to it.

When This Clause Causes Issues

• An employee creates something unrelated to their job, but the company claims ownership because of the clause's broad language.
• An employee leaves the company and wants to use their ideas elsewhere, but the clause prevents them from doing so.
• A misunderstanding occurs when an employee uses personal time and resources to create something, yet the company still claims rights.

What to Do Before You Sign

• Ask whether the clause covers work done outside of work hours.
• Find out if the clause applies to creations unrelated to your job duties.
• Ask how the company defines "related to the company's business."
• Inquire about what happens to IP rights after you leave the company.
• Clarify if personal resources used in creation affect ownership rights.
• Ask if there are any exceptions to the IP Assignment clause.