What is an intellectual property (IP) right?
An intellectual property right (commonly abbreviated to IP) is a type of intangible property right. Tangible property is physical things like cars, computers, phones etc. These are legally known as chattels. Intangible property is something that is creative and original – an idea that has not been replicated elsewhere. As such ‘thought’ can be owned, transferred, leased and licensed – property really is a type of property like any chattel.
To illustrate the distinction, let’s have a look at a quick example. Any original painting will encompass two types of property: physical property and intellectual property. The physical property is the canvas itself, the frame, the paints and any other materials used to create the painting. The ideas in the painting, the way the colours have been applied and combined and the actual image as a whole is intellectual property.
In the context of employment if an employee has an idea, who owns it ?
Generally, if the idea arises from work which forms part of the employee’s duties, the company may well own the IP rights under different statutes for different types of IP rights. For example :-
- Under the Patents Act 1977 there is a general p[resumption in favour of an employer if the invention was created during employment
- Database rights of employers are protected in general terms under the Copyright and Rights in Databases Regulations 1997
- Employers general rights in copyright for works created as part of employment are protected in the Copyright, Designs and Patents Act 1988
Aside for these statutory protections, every employment relationship will involve an implied duty on both employer and employee for mutual trust and confidence. An attempt by an employee to assert rights or to use IP such as trade secrets may well be in breach of these duties although the duty may not persist after leaving employment.
Based on all of the above it is advisable from an employers point of view for an employment contract to make specific provision about important IP rights and to make it clear what will be considered as confidential information and trade secrets. A “belt and braces” approach is also recommended was regards highly valuable IP such as inventions where the employee may also be required to sign a specific assignment of any possible rights the employee may have.
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