Published on November 7th, 2018 by Alan L. Sklover
“Create with the heart; build with the mind.”
– Criss Jami
ACTUAL CASE HISTORIES: Adelisa, 38, had a rock-solid resume as an Analytics Design Specialist, having been employed by a list of impressive hedge fund employers. She was an expert in assisting Quantitative Analysts design software and algorithms to better predict investment performance. Her experience, skills and industry relations were such that she received recruitment inquiries almost weekly. For a few years, she was on her own as an independent contractor, but was now a mother of two young girls, and had become far more interested in the comfort afforded by a weekly paycheck.
One inquiry she received from a large hedge fund intrigued her so much that she entered into serious talks with them for a senior executive position that included very substantial compensation, great working flexibility and significant job security.
I had worked with Adelisa several times before, each time she climbed the “career ladder.” When she contacted me this time, she had already received a “standard” employment contract from her potential employer. I noticed right away that it was heavily laden with many detailed provisions intended to protect the employer from employees “stealing” creations, inventions, proprietary information and trade secrets. The entire employment agreement consisted of 8 pages, 4 of which were devoted to the subject of protecting the employer’s intellectual property.
Adelisa had the “mirror image” concern. That is, over the course of several years, on her own time she had developed what she referred to as her “Golden Goose,” which was a computer program she had created entirely by herself, years ago, while working as an independent contractor. As best I can explain it (they didn’t teach this stuff in law school), it was “an algorithmic-based platform that could ‘carry’ various data packages to test predictive capacities.” Adelisa said it was actually based on “digital intuition,” and was a type of artificial intelligence.
Her “mirror image” concern was how she could use her “Golden Goose” on the job, yet not lose any of her rights in and to it. The draft employment agreement, like most, provided that anything and everything she might use to do her work for this employer would automatically be deemed the employer’s sole property. She asked if we could help her respond to that language, in order to protect her “Golden Goose.”
It was an interesting project, and the results were well worth it. First, her new job went very well, and her compensation was very significant. And, when, years later, she eventually departed from the company for “greener pastures,” there were no disputes, no claims, and no threats regarding her “Golden Goose,” which was precisely her goal. Mission accomplished.
LESSON TO LEARN: With few exceptions, everything in life – and that includes work life – can be “navigated and negotiated” in wise ways. Taking care, when entering into new work relations, to try to prevent problems from arising in the future, is the wisest of wise ways, and always worth the effort.
In two ways, employees often lose their rights in their pre-existing creations: (1) law (the “Work for Hire” rule), and (2) by agreements they are asked to sign (often called “Assignment Agreements). In this blog post, we address both, and the ways prospective employees can and should protect their “pre-existing creations” in the context of interviewing and job offers.
As a few examples, they include software, works of art, written materials, musical compositions, visual and audio presentations, and inventions. By law, they are materials that can be (a) copyrighted, (b) trademarked and/or (c) patented. By means of self-help – our favorite topic for employees – they can take steps that can protect themselves, and might be just as good, or better.
While each employee’s “pre-existing creations” are unique, and each employment dynamic is unique, there are some generalized observations we can share to assist in the process of protecting employees’ “pre-existing creations.”
As the quote above reminds us, “Create with the heart; build with the mind.” I would simply add, “And then protect what you create as best you can.”
WHAT YOU CAN DO: Here are 12 pointers for employees in Adelisa’s “shoes.” This list is not exhaustive, but it does cover most of the critical points most employees need to understand:
1. Understand the meaning of “Work for Hire.” “Work for hire” (or “work made for hire”) is a legal term for an item of creative content that was made on or in connection with the job. Examples include written works, data analyses, visual presentations, songs, computer code and programs, and useful forms and booklets. If the creation was made during the period of employment, made or modified while working, and is related in some way to the job, the law presumes that it is a “work for hire” and thus is owned entirely by the employer. Thus, when you eventually leave, you cannot take it with you.
What happens if you created it before you started your job, but you used it on your job? What happens if you created it in your spare time, say, on the weekends? What happens if it was entirely yours, but you shared it with colleagues, and they used it on the job? In each instance, chances are your employer will consider it their property, in all respects, and take legal action against anyone, you included, who acts otherwise.
2. As a wise first, prepare a simple “Generic Description” of Your Creation. It is quite probable that, sooner or later, you will be in a situation in which you will want or need to describe, discuss, or share that you have a “creation” that might be useful to your work. To avoid possibly being too specific or particular about it, it would be best to have a safe “generic description” on hand to permit you to comfortably do so.
One or two sentences should suffice. More than that might give your creation’s secret(s) away, and in that way unintentionally enabling others to claim it as their own. So, take a few minutes to prepare such a safe “generic description” without unnecessary particularity and specificity that could enable someone to claim it as their own.
Here is a purely hypothetical, example: “A software program that can be used to predict future prices of corn based on (a) past weather in three countries on three different continents, going back a specified period of time, (b) gross tonnage of international shipments of corn from one certain U.S. state during over the past years, (c) the price of corn syrup on two certain mercantile exchanges, and (d) two other unrelated factors, written in a commonplace computer language and containing encrypted entry code words.”
Hopefully, it is enough to give others a general idea, yet not enough to give any specific information that others could use to make one of their own.
3. Prepare, too, a Request for a “Pre-Existing Creation Exception.” For safety sake, presume that any new employer will, sooner or later, ask you to sign an agreement of some sort that says, one way or the other, “If you use it on the job, we own it.”
If you have prepared a “generic description” of your creation, you are halfway there to requesting a “Pre-Existing Creation Exception,” because your “Generic Description” is what you will use to describe your “Pre-Existing Creation.” You can use it to overcome the “Work for Hire” presumption and any request you sign your rights away, proactively, meaning before the issue comes up, or defensively, when the issue comes up. My suggestion is to always act proactively, if you have the chance.
Your request for a “pre-existing creation exception” is just what it sounds like, with the essential message that “I want to make sure we are in agreement that I prepared ‘my creation,’ before starting this job, not on the company’s time, not with the company’s resources, and not part of my job, and that if I do use it on the job, the company will not impliedly have any interest in it, rights to it, by agreement, by license, or by law.”
You don’t need to wait until the need arises for such a written understanding. Having already drafted one, and having it on hand if you ever need it – proactively or defensively – it will be on your computer, available on a moment’s notice.
4. In interviews, never share your valuable creation(s) without first taking steps to protect them. It is not unusual for job applicants and interviewers to discuss a job applicant’s creativity, and for an interviewer to request an opportunity to review his or her portfolio of designs, photos, created logos, Powerpoint presentations, or research reports. There’s nothing wrong with that. However there is something very wrong with showing it, sharing it, divulging its advantages, or offering to leave it for inspection while the applicant’s candidacy is considered without first taking necessary precautions to protect it.
To read one of our blog posts entitled “Theft at Interviews: 7 Steps to Avoid It,” just [click here.]
The best way to protect your “pre-existing creations” in the interview process is to refrain from discussing or sharing it. If you wish to discuss or share it, present to the employer a simple memo or letter acknowledging that it is, and will always be, your “pre-existing creation” and thus always fully owned by you.
5. Some employers ask job applicants to create a “presentation” as part of the interview/evaluation process. One client was recently asked, as part of his job interview process, to make a presentation that illustrates his ideas, images and thoughts about the “Restaurant Environment of the Future.” This is becoming more and more common. If you are asked to do the same or similar, since you created the presentation before the commencement of the employment relation, care should be taken to protect your interests in and to it, as we suggest, above. Otherwise, you could lose rights to it, and not even be able to show it to other prospective employers.
Attending an Interview? Asked for a Presentation? Received a Job Offer? Protect Your Pre-Existing Creations with these Two Model Letters (One for Requested Presentations at Interviews, One for All Other Pre-Existing Creations.) If interested, just [click here.] They show you “What to Say, and How to Say It.”™ Delivered by Email – Instantly!
6. Be vigilant about every document you are asked to sign. Many employers go further, and insist that their employees sign agreements, often as part of their initial offer letters (or on one of the first few days on that job), that provide that even if you conceived the idea for the creation before starting the job, or created it before you started the job, you must agree it is a “work for hire” and “hereby sign over all rights to the employer” or words to that effect. Yes, this is very unfair, but becoming more common, nonetheless. And, such “assignment agreements” are the most unfair when presented after the job commences, when it seems riskiest to “Just Say No.”
More often than not, these agreements have names like “Confidentiality Agreement,” “Trade Secrets Agreement” and “Proprietary Information Agreement.” In the law, titles don’t matter; what is inside the agreement – even if it is “buried” inside the agreement – is what counts. In all events, the words “I hereby assign” or words similar to that, are the “red flag” words to watch out for.
7. Once on the job, never, ever upload your creation onto your new employer’s computers. If you do that, even just once, it is more than likely that at that very moment, you will effectively be giving up all rights and interests in it, due to (a) agreements you will be asked to sign after you are hired, (b) the provisions of the employer’s Employee Handbook, (c) the law, and even (d) your being denied any opportunity to retrieve it if and when you leave. Or, perhaps worse, you (or your next employer) may end up being sued for a gazillion dollars if you do try to “take it with you.”
The law and practical reality are NOT on your side in this context, and you must, must, must dedicate yourself to not hurting yourself in this regard. Pleeeeze.
8. You can and should protect your creations at any time, but surely the sooner the better. Please understand that, if the issue arises while you are working on a job, and you failed to raise your “pre-existing creation” when you interviewed, or were hired, all is not lost. Remember that “It is a lot easier to prevent a fire than to fight one.” The steps noted above are essentially those you would need to do so.
Want to have or share ownership or authorship rights in creative works you create either at Work, or At Home? We offer Two Model Memos for Employees to Request Ownership/Authorship Rights in what you create at work. If you do, just [click here.] They show you “What to Say, and How to Say It.”™ Delivered by Email – Instantly!
9. Have Faith in Your Common Sense. In all you do in this regard, have faith in yourself, and in your common sense. Common sense, alone, won’t always get you exactly where you want to go, but it surely will help you move forward in the right direction. In my view, having practiced law for over three decades, the law is essentially common sense and fairness, handed down from one generation to the next.
Try not to feel overwhelmed, bewildered, frustrated or confused by “legalistic” words or phrases; instead take things step by step, ask questions, and always “come home” to the practice of using the common sense you were given by your parents and teachers, and have exercised and developed over the course of your lifetime.
10. Have Faith, too, in good old “Plain English.” Kingman Brewster Jr, the former Dean of Yale University, said that “Incomprehensible jargon is the hallmark of a profession.” I can attest to the applicability of his words to the legal profession. Consciously or not, we tend to use words, phrases, “legalisms,” and jargon that is confusing to non-lawyers, and often even to other lawyers, as well.
If you feel confused or intimidated by the legal jargon and legalistic language of an agreement, always default back to what is commonly referred to as “Plain English.”
For example, if a sentence reads:
“Notwithstanding the foregoing, the party deemed not prevailing in said proceedings shall, ipso facto, be deemed liable to the deemed prevailing party for its proceedings costs, ab initio.”
don’t be afraid to insist that it be explained to you in simple Plain English. Then you can insist that its Plain English “interpretation” be inserted in its place. (By the way, all that sentence means is “The winning person in the lawsuit gets paid its legal fees by the losing person, from the beginning of the case.”) Did we really need all that legal mumbo jumbo?
11. You might be wise to consider a Consultation with an Intellectual Property (“IP”) Attorney. “Intellectual Property Law,” (sometimes called “IP Law”) is a growing legal specialty. While it can seem rather complicated, like rocket science and brain surgery, it is based on experience and common sense above all. IP attorneys concentrate their law practices on patents, copyrights, trademarks, and related issues, that is to say, “the protection of ideas and creations.”
It is not my intention to needlessly create employment opportunities for attorneys. But in this circumstance, if protection of your “creation” is of sufficient importance to you, the price you pay for the consultation may well be a very wise investment.
Incidentally, I have noticed that attorneys of all kinds who do not practice law in the major cities, but instead in suburban or rural areas, charge a whole lot less than those who practice in major cities. The same goes for attorneys who practice in small firms or on their own, and not in large law firms. You can find a well-qualified IP attorney in your state in a suburban or rural area at half the price of using a “big city attorney” by using the internet, and you should keep this in mind. Also, there is nothing wrong with asking if an initial telephone consultation entails any charge; it just might not.
12. Perhaps file a Patent, Copyright or Trademark Application to Protect Your Creation. If your creation is (or may be become) a particularly valuable creation, it might be wise to submit to the U.S. Patent and Trademark Office a patent, trademark or copyright application, to gain even further protection. That also establishes that it was created before you began your new job, and not afterward. While you can do so yourself, the assistance of an IP attorney is recommended.
Additionally, if you are so inclined, there are many companies to be found on the internet who assist persons like yourself to just that, at a fairly reasonable cost.
As a creative employee, you need to be vigilant. You can take steps to protect your creative works from being considered a “work for hire” and thus lost. “Forewarned is forearmed.”
In Summary . . .
If you might soon be approaching interviews or a new job, and you have a “pre-existing creation” that may be related to your new job, you should take steps to protect it. If you don’t, you might just lose all rights in and to it, and later face disputes over it. There are steps you can take to protect your “pre-existing creation,” and you may be wise – very wise – to consider taking those steps . . . before it is too late. These 12 pointers should help you get started doing so.
P.S.: If you would like to speak directly about this or other subjects, Mr. Sklover is available for 30-MINUTE, 60-MINUTE, OR 120-MINUTE TELEPHONE CONSULTATIONS, just [click here.] Evenings and weekends can often be accommodated.
SkloverWorkingWisdom™ emphasizes smart navigating and negotiating for yourself at work. Navigation and Negotiation of work and career issues requires that you think “out of the box,” and build value and avoid risks at every point in your career. We strive to help you understand what is commonly before you – traps and pitfalls, included – and to avoid the likely bumps in the road. For those anticipating a new job, and possibly discussing it in interviews, or using something valuable they created on the job, this is how we suggest you move forward: with care and prudence.
Always be proactive. Always be creative. Always be persistent. Always be vigilant. And always do what you can to achieve for yourself, your family, and your career. Take all available steps to increase and secure employment “rewards” and eliminate or reduce employment “risks.” That’s what SkloverWorkingWisdom™ is all about.
*A note about our Actual Case Histories: In order to preserve client confidences, and protect client identities, we alter certain facts, including the name, age, gender, position, date, geographical location, and industry of our clients. The essential facts, the point illustrated and the lesson to be learned, remain actual.
Please Note: This Email Newsletter is not legal advice, but only an effort to provide generalized information about important topics related to employment and the law. Legal advice can only be rendered after formal retention of counsel, and must take into account the facts and circumstances of a particular case. Those in need of legal advice, counsel or representation should retain competent legal counsel licensed to practice law in their locale.
Sklover Working Wisdom™ is a trademarked newsletter publication of Alan L. Sklover, of Sklover & Company, LLC, a law firm dedicated to the counsel and representation of employees in matters of their employment, compensation and severance. Nothing expressed in this material constitutes legal advice. Please note that Mr. Sklover is admitted to practice in the state of New York, only. When assisting clients in other jurisdictions, he retains the assistance of local counsel and/or obtains permission of local Courts to appear. Copying, use and/or reproduction of this material in any form or media without prior written permission is strictly prohibited. All rights reserved. For further information, contact Sklover & Company, LLC, 45 Rockefeller Plaza, Suite 2000, New York, New York 10111 (212) 757-5000.
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