Baker McKenzie's Intellectual Property team has published a comparative study on protection and compensation for inventions and creations by employees in over 35 countries. At a time when French enterprises are considered to be among the most innovative in the world – as several recently published rankings have shown – the question of the intellectual property rights attached to inventions and creations made by employees is becoming increasingly important. The crucial questions in this matter concern the ownership of the intellectual property rights on the one hand and the calculation of the compensation to be paid to the salaried inventors or creators on the other hand.

The study reviews the rules applicable in the 35 countries concerned, focusing on three major fronts: the different categories of invention (technical inventions or artistic, literary or IT creations), the rights and obligations of the salaried inventor or creator as well as the rights and obligations of the employer.

French salaried creators and inventors well protected and compensated

French employees have one of the most favourable regimes in the world as far as their inventions and creations are concerned.

The French regime for creations by employees protects the employee: in principle, when he is the sole author, and except where software is concerned, the employee owns the intellectual property rights to his work. As such, the use of an employee’s creation by his employer, except where it is a collective work, requires the prior authorisation of the employee. Before considering any such use, the employer therefore has to acquire the intellectual property rights from his employee by drawing up a transfer agreement according to the strict rules imposed by the French intellectual property code.

The situation is different where inventions are concerned to the extent that inventions, whether patentable or not, belong to the employer as soon as they are completed or can be transferred almost automatically to the employer in most cases.

On the other hand, from a financial point of view, the attribution of an employee’s invention or creation to his employer must always be accompanied by the payment of compensation to the employee. Only the creation of software by an employee in the private sector is not affected by this rule.

For inventions, the compensation depends on the context in which the invention was produced. Consequently, when the invention is produced within the framework of an inventive assignment clearly defined by the employer, the employee’s compensation generally corresponds to a fixed payment calculated based on the use of the invention by the enterprise.

For inventions outside the scope of a specific assignment, that is to say those made by an employee that are not part of a task clearly assigned to him, an agreement must be reached between the salaried inventor and the employer in order to fix a “fair price”.

If no agreement is reached between the parties, it is the CNIS, Commission Nationale des Inventions de Salariés, or the District Court which will be tasked with fixing the price.

As far as employee creations are concerned, whether they are creations protected by copyright or designs and models, the principle applied is that of compensation in proportion to the revenues generated by the use of this creation and, as an exception, a fixed compensation. However, assignments of copyright free of charge are also possible in certain conditions.

Regimes that are more protective of the employer’s interests in the United States, in Asia and certain European countries

Countries like the USA, Singapore or Australia are much more in favour of employers and allow them to become the owners of the rights to the inventions or creations produced by their employees, without having to pay any additional compensation.

Intermediary systems exist in the United Kingdom, Italy, Turkey and Japan where the employee does not necessarily receive any additional compensation for a creation but must be remunerated for his inventions. Inversely in Canada, there is no additional compensation for salaried inventors, but only for creators.

However, there are other legal systems that also protect the interests of employees and their rights. For example, China, Russia and Hungary have rules on additional compensation for employees who make inventions and the copyright generally belongs to the employee, except if the employee was hired precisely for the purpose of producing the creation.

Please click here to view image