Key Takeaways

  • An intellectual property waiver is crucial in employment settings to ensure the employer legally owns IP created by employees.
  • IP includes not just traditional works like music and writing but also software, processes, and designs.
  • Work-for-hire laws provide some protection but may be insufficient without explicit waivers or assignment agreements.
  • IP waivers must clearly define usage rights, royalties, and scope of the transfer.
  • Organizations, particularly in academia and research, often have tailored IP waiver policies to handle non-standard sponsor agreements.

The waiver of intellectual property rights is a hot topic in today's tech-dependent world. Companies are beginning to rely on their employees to help develop, invent, or design new business assets that the company can profit from or use in their day-to-day function. When this occurs, an employer may find themselves caught up in a court battle over who has ownership of this intellectual property. This often occurs when they fail to have employees sign a waiver of intellectual property rights. 

In an employer/employee relationship, if the company wishes to use any creative work from an employee, it will be required to have the employee sign a release of rights to the intellectual property in order for the company to protect itself. This is necessary even though a creative work product that is produced during the employee's normal employment parameters is typically covered under employment laws. To prevent a legal battle, it is best to obtain a waiver. The waiver should address such issues as:

The waiver of intellectual property rights will ultimately release the rights of ownership and act as a bill of sale to the employer. 

What is Intellectual Property? 

Intellectual property is defined as an asset that is developed from the human mind. While the original work is technically intangible, it can be described in a written manner and converted in the end to a tangible form. Since intellectual property comes from mental processes, it is often considered the property of the creator by default. This right to ownership of intellectual material is protected by law, and acquiring ownership rights is essential if a company plans to benefit from the property.

It is important for all businesses who employ workers that create artistic work to understand intellectual property laws. Some of the creative work that is most commonly associated with intellectual property include:

  • Creating business processes
  • Writing
  • Creating music
  • Designing software applications

Even though the employee works for you, you will most likely need them to sign a release of rights to the intellectual property in order to have proper ownership of all the copyrights, trademarks, and patents involved in their work.

The Growth of Intellectual Property Law 

Intellectual property laws are not a new issue for businesses. Employees have signed over intellectual property rights for everything from music to inventions for years. The reason that the area of intellectual property law has seen a recent upsurge is due to the broader language that is included in the legal definition of intellectual property which used to only include music, words, and design. 

In today's business world, the legal term Intellectual Property, or IP, includes a much broader range of  areas including such things as:

  • Software applications
  • Business methodologies
  • Industrial and manufacturing processes

For example, if an employee was to design a new manufacturing process, such Henry Ford did when he developed the assembly line, a release of the intellectual property rights to the idea and design would be required for the company to be able to profit from the new process. Without a proper work-for-hire contract or transfer of intellectual property rights, an employee could demand a company to cease using the design.

Work-for-hire was established under the Copyright Act of 1976, where businesses could consider the intellectual property the employee created as part of the scope of their employment and obtain ownership rights to it.

Therefore, if your employer/employee situation is work-for-hire, the employer would automatically retain the rights to the intellectual property that is produced in the scope of the employee's job. Unfortunately, it is hard to prove the work-for-hire relationship when it comes to a legal case, so it is often recommended that you secure a waiver of intellectual property rights that will specifically establish the employer/employee agreement and who owns the rights to the property that is produced as a result of the relationship.

Common Scenarios Requiring an Intellectual Property Waiver

Employers should proactively use intellectual property waivers in situations where ownership might be unclear or contested. These include:

  • Collaborative Development Projects: When employees or contractors work in teams to create innovations, waivers help clarify ownership.
  • Sponsored Research or Grant-Funded Work: Universities and research institutions often require waivers when the terms of a sponsor conflict with institutional IP policies.
  • Contractor or Freelancer Contributions: Unlike employees, contractors typically retain IP rights unless otherwise agreed upon in writing.
  • Remote and Hybrid Work Settings: Where lines between personal and professional projects can blur, clear waivers protect the business's claims to developed IP.

These waivers should always be tailored to the nature of the work and the legal jurisdiction involved.

Intellectual Property Release Form 

The best way to ensure that you own the proper rights to intellectual property from your employee is to have them fill out an Intellectual Property Release Form which is a document assigning the rights to their created property to someone else. This form is traditionally used for artists that will allow their property to be used for a different purpose and do not wish to retain the rights to the intellectual property.

Once a person or company obtains rights to the person's work they will be able to:

  • Copy it
  • Distribute it
  • Publish it

Key Elements of an Effective Intellectual Property Waiver

An intellectual property waiver should be clearly drafted to ensure enforceability and minimize ambiguity. Key elements include:

  • Clear Identification of the IP: Define what constitutes the intellectual property being waived—whether software code, technical drawings, written content, or patented inventions.
  • Scope of the Waiver: Specify whether the waiver applies globally or is limited to certain uses or jurisdictions.
  • Assignment of Rights: Clearly state that all rights, including moral and economic rights, are assigned to the employer or commissioning party.
  • Royalty Clause: State whether compensation is provided or waived entirely.
  • Irrevocability and Binding Nature: Indicate that the waiver is binding and cannot be reversed.
  • Signature and Date: Must be signed by both parties to be valid.

A poorly drafted waiver can lead to disputes, especially if the creator later contests ownership or commercial use of the work.

Waivers in Global and Policy Contexts

On a broader scale, intellectual property waivers have been the subject of international debate. For example, the COVID-19 pandemic brought global attention to IP waivers for vaccines and therapeutics, with policymakers discussing temporary suspensions of patent protections to increase global access.

These high-profile cases underscore the significance of IP waivers not just in employment contracts, but in policy frameworks that impact innovation, access, and public health. Understanding these contexts can help employers, researchers, and innovators anticipate future regulatory changes that could influence IP management.

Frequently Asked Questions

  1. What is an intellectual property waiver?
    An intellectual property waiver is a legal document in which a creator relinquishes rights to their IP, transferring them to another party, typically an employer.
  2. Why is a waiver necessary if the work was done on the job?
    Although work-for-hire laws cover some IP created during employment, they don’t apply in all situations. A waiver eliminates ambiguity and ensures enforceability.
  3. Can contractors be forced to sign an IP waiver?
    While contractors cannot be “forced,” businesses can make IP assignment a condition of the contract. Without it, contractors retain their IP rights by default.
  4. What types of IP are typically covered in a waiver?
    Commonly covered types include software, designs, inventions, writing, music, and business processes.
  5. When should an intellectual property waiver be signed?
    Ideally, before the work begins—either at the time of hire, contract signing, or project kickoff—to avoid disputes later.

If you need help with drafting a waiver of intellectual property rights, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.