When will an invention belong to an employer?

The UK Patents Act sets out circumstances in which an invention made by an employee will be taken to belong to his/her employer. The circumstances are if:

• the invention was made during the course of normal duties of the employee, or if the invention was made outside of the employee’s normal duties but in the course of duties specifically assigned to him/her, and in both cases the circumstances should have been such that an invention might reasonably have been expected from the carrying out of his/her duties; or
• the invention was made in the course of an employee’s duties and at the time of the invention the nature of the employee’s duties meant he/she had a special obligation for furthering the interests of the employer’s undertaking.

A common example of case (i) above arises for scientists and engineers having a contract of employment for research and/or development in the UK.

Directors, partners or sole company owners are good examples of case (ii) above as they are often considered to meet the “special obligation” requirement. This is true even if, strictly speaking, they are not “employed” by the “employing” company.

The provisions apply to employees who are employed in the UK, employed mainly in the UK, or if the employee’s place of employment cannot be determined but the employer has a place of business in the UK to which the employee was attached.

Is there a requirement to provide inventor compensation in the UK?

The Patents Act has provisions for an employee to seek compensation from his employer through the Patents Court or the Patent Office if the employee believes a fair reward has not been given for an invention. To be successful, an employee must show that the invention has provided an outstanding benefit and the invention was something that would not normally be expected to arise from the employee’s duties. Case Law suggests that a high threshold is applied when determining whether the benefit is “outstanding”, and this can only apply to something truly out of the ordinary when looked at in the total context of the employer’s activities.

Is the situation different for employees in other countries?

Although the right to the invention is taken to belong to the employer for employees in the UK, other countries have different provisions regarding employee inventions. For example, in the United States of America the situation is different such that an employee is usually required to complete an assignment document to transfer rights to the employer. Requirements for inventor compensation also differ between jurisdictions.