Does Your Employer Own Everything You Create?

By Cliff Ennico

April 3, 2018 6 min read

"I'm a full-time employee (W-2) for a large financial institution.

"In my spare time, I have been doing research on a new technology product that will have a dramatic impact on the financial industry, and would like to write a book about it. I am concerned, however, that if my employer finds out about this project that they will claim ownership of it, or maybe perhaps even fire me.

"What is the best way, or is there a way, for me to pursue this project? I am not sure I will make much money from this but if I am ever laid off from my current position, I think having a book in print will make it easier for me to obtain consulting assignments in this area which are likely to be quite lucrative."

Show me a full-time corporate employee these days and I will show you an entrepreneur looking to break free. All people need a plan B for their career. The trick is to prepare for that plan B without tipping off your current employer and triggering a premature exit into the entrepreneurial world.

Here are the questions I would ask this reader if he or she were a client of mine:

Have you signed a "work made for hire" agreement with your employer? Many employment agreements contain an "assignment of inventions," "assignment of rights" or "work made for hire" clause giving the employer ownership of anything you may create as an employee of the company. If properly drafted, this clause would apply only to things you create that are "directly related" to your employer's business.

Since you are a W-2 employee, anything you create may well be owned by your employer anyway, as a matter of law. But since this book project doesn't appear to relate to your employer's current business, an agreement might actually help you.

Have you worked on the book during business hours, while on company premises or using company resources? Even if the book project doesn't relate to your company's business, working on the book during the time you are required to devote to your employer or using company resources to write the book might well be viewed by your employer as a conflict of interest or a breach of your duty of loyalty.

Is the subject of the book directly related to your responsibilities as an executive, or is it entirely different (for example, targeting small to midsized businesses)? It would be difficult to imagine an employer asserting ownership of your book project if it were completely unrelated to your employment — for example, a children's storybook or collectors guide for people engaged in a certain hobby.

A book that deals directly with the day-to-day nature of your work, on the other hand, would almost certainly be viewed as the employer's property. No company wants its employees training potential competitors.

Falling in the middle is a book that relates to your employment but targets a market your employer doesn't care about — since you work for a large financial institution, a book teaching project management techniques for small businesses or entrepreneurial startups may not be viewed as competitive. Maybe. Perhaps.

If your employer were to find out about this project, how upset would he be? Some employers, believe it or not, actually encourage their employees to write books on the side. For example, large law firms benefit when their partners write legal treatises because they establish the author's (and, by implication, the firm's) expertise in a particular area of law and may generate referrals from other law firms looking to benefit from that expertise.

If you are a lower-level employee of the financial institution working set hours without much managerial responsibility, your employer is less likely to be concerned about your book project. If you are a senior executive who is expected to devote your entire working time to the company, however, your employer is more likely to take a dim view of this project.

Short of getting your employer's written consent to this project (which is not likely to be given even if he isn't overly concerned about it), there are several things you will need to do before the book is published.

First, collect all of the agreements you have with your employer, and discuss them with an employment lawyer who is well-versed in noncompete clauses and other restrictions on an employee's outside activities. If the lawyer tells you it's too risky to write the book, don't do it.

Second, make sure you only work on the book in your spare time, at home and using your own computer.

Third, be sure that any stories, examples or case studies you use in your book are sufficiently "sanitized" so that a casual reader would not make the connection to your employer. Ideally, the book should not contain any information or material you have obtained directly from your employer or your day-to-day working life, or describe people that resemble or are based on your boss or colleagues.

Lastly, consider writing the book under a pseudonym — a false name — and make sure your publisher's press materials do not contain any information that would identify you if your boss were to casually pick up a copy at the local Barnes & Noble outlet.

Cliff Ennico ([email protected]) is a syndicated columnist, author and former host of the PBS television series "Money Hunt." This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our webpage at www.creators.com.

Photo credit: at Pixabay

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