Intellectual Property in Canadian Employment Law

The world of intellectual property can be complex, especially when navigating its role within the employment landscape. As an employee in Canada, you might come up with brilliant ideas, inventions, or creative works during your course of employment. But who will ultimately own the rights to those creations? The answer will usually depend on understanding intellectual property law and your employment contract.

This blog post delves into the intricacies of intellectual property law in Canada as it applies to employee inventions and creations. We’ll explore the different types of intellectual property, ownership rights, and factors that determine who gets the credit (and potential profits) for employee ingenuity.

Types of Intellectual Property Relevant to Employment

Canadian intellectual property law protects various forms of creative expression and inventions. Here are the key types you might encounter in an employment context:

Copyright: This protects original literary, artistic, dramatic, musical, and other intellectual works. If you create content like software code, marketing materials, brochures, or even unique blog posts for your employer, copyright might be relevant.
Patents: Patents grant exclusive rights to inventors for new and useful processes, machines, manufactures, and compositions of matter. So, if an employee develops a new invention during his or her employment, patent law could come into play.
Industrial Designs: These protect the visual appearance of a product, such as its shape, configuration, or ornamentation. If you design a unique product component or packaging for your employer, industrial design rights might apply.
Trademarks: This protects distinctive words, symbols, designs, or sounds used to identify and distinguish the source of goods or services. So, if an employee creates a unique logo or brand name for your employer, trademark law could be relevant.

Who Owns What? Understanding Ownership Rights

The key question in employment-related intellectual property is: who owns the rights to your creations? Here’s where things can get tricky.

Copyright

The general rule is that the author is the first owner of the copyright in their work. However, section 13(3) of the Copyright Act provides for an important exception: if the work is created in the course of employment under an employment contract, and absent any agreement between the parties to the contrary, the employer will be the owner of the copyright in the work created by the employee without the need for a formal assignment. As such, employers should therefore be mindful of the three conditions that must be met in order to trigger that exception. On the other hand, employees should keep in mind that if the employee’s job duties involve creating content, the copyright might belong to your employer, even if you used your creativity and skills. However, there are exceptions. For instance, if the work is created outside the scope of your employment (e.g., a personal blog post written on the employee’s own time unrelated to the employer’s business interests, products or services), you likely retain copyright ownership. Additionally, some employment contracts might have specific clauses addressing copyright ownership, so reviewing your contract is crucial.

Patents

Unlike the Copyright Act, the Patent Act does not include specific provisions addressing the ownership of patent rights in inventions made during the course of employment. The applicable rules were therefore developed by the courts and the general principle is essentially the opposite of that applicable to copyright: The employee will, as a general rule, retain ownership of the patent rights in their inventions. The employer can nevertheless benefit from two exceptions to that rule: the employer will be entitled to the patent rights in the invention of an employee if the employer has an express agreement to that effect with the employee, or if the employee was “hired to invent”. However, your employment contract might contain clauses stating that inventions conceived during your employment, even partially during work hours, become the property of your employer. This is why it is important to carefully reviewing your employment contract to understand its terms and conditions. In order to determine if an employee was “hired to invent”, the courts in the federal jurisdiction will consider eight factors.

the employee was hired expressly for the purpose of inventing;
the employee had previously made inventions;
the employer put in place incentive plans to encourage inventions;
the conduct of the employee following the invention’s creation suggests that the employer is the owner;
the invention is the product of the employee being instructed to solve a specific problem;
the employee sought help from the employer in the making of the invention;
the employee was dealing with confidential information; and
it was a term of the employee’s employment that he could not use, to their advantage, ideas which he developed.

However, in some cases, the courts have jurisdiction to resolve employer and employee patent ownership disputes. In some of those cases, the courts will simply consider what the employee was hired to do and whether the invention was created while performing that task. If the answer is yes, the court will usually decide that the employer retains patent rights in the invention.

Industrial Designs & Trademarks

Similar to Canadian copyright law, section 12(1) of the Industrial Design Act states that the first owner of a design is its author, unless the there is a contract with clauses assigning ownership of these rights to the employer. In that case, the employer will become the first owner.

Key Factors Influencing Ownership

In the employment context, there are several factors that can influence who owns the intellectual property rights in inventions or creations:

Employment Contract:This legal document is paramount, so it is important to thoroughly the employment contract with an Ontario employment lawyer to understand any clauses regarding ownership of inventions, creative works, or designs you might develop during your employment.
Nature of Work:If your job description specifically mentions creating content, designing products, or inventing solutions, the employer might have a stronger claim to ownership, such as with engineering jobs.
Use of Company Tools, Equipment or Resources:If you used company resources (g., software or equipment) to create the intellectual property, it strengthens the employer’s ownership claim to the inventions or creations.
Who Directed the Work?If your employer specifically instructed you to create something, it strengthens their ownership claim. Independent creations on your own initiative might be subject to different ownership rules.

Book a Consultation with an Employment Lawyer in Toronto

To schedule a consultation to discuss your employment law matter with Sezar Bune, please call 647-822-5492. Consultations may be conducted in-person at the Toronto office or by telephone. Sezar will review your correspondence and reply to you if he believes that you have a case he can assist with, following which you can schedule a formal consultation to discuss your case and options available to help you. If you are inquiring about fees, please call the office directly to discuss, as fees are variable and depend on the complexity of the case. Bune Law’s boutique size allows us to focus on what matters most: the best results for clients. Bune Law offers competitive hourly rates and has the flexibility to offer clients predictable fee arrangements.

If you need a Toronto employment lawyer who is committed to delivering strong results and proactive solutions, please contact Bune Law online or by phone today at 647-822-5492