Who Owns What You Create at Work? Employee IP, Explained
Does my employer own my invention or code? How employee intellectual property rights work — copyright, patents, trade secrets — and what your agreement changes.
Quick answer: Who owns what you create at work depends on the type of intellectual property and on what you signed. Copyrightable works made by an employee within the scope of employment belong to the employer automatically as works made for hire. Patentable inventions are the reverse — the individual inventor owns them unless an assignment agreement transfers them, which is why nearly every employer requires one at hiring. Trade secrets developed on the job belong to the employer, though your general skill and experience leave with you. Independent contractors mostly keep what they create absent a signed agreement. For the vast majority of workers, the real answer lives in the employment agreement, filtered through state statutes like [California Labor Code § 2870](https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=LAB§ionNum=2870). This is general education, not legal advice — have an attorney licensed in your jurisdiction review your specific situation.
You built something clever — a tool, an algorithm, an app, a design — and now you’re wondering whether it’s yours or your employer’s. Or you’re the employer, and you’re wondering whether the company actually owns what its team has been building. The instinctive answers (“they paid me, so it’s theirs” or “I made it, so it’s mine”) are both wrong often enough to be dangerous. Employee intellectual property rights follow different default rules for copyrights, patents, and trade secrets, and almost all of those defaults can be — and usually are — rewritten by contract. This hub walks the whole terrain and links to deeper guides on each piece.
The defaults differ by type of IP
The first thing to understand is that there is no single rule for “IP you create at work.” U.S. law sets three very different starting points.
Copyright: the employer is the author
For copyrightable works — code, documents, designs, graphics, manuals, marketing copy — the Copyright Act’s work-made-for-hire doctrine (17 U.S.C. §§ 101, 201(b)) says that a work prepared by an employee within the scope of employment belongs to the employer from the moment of creation. The employer isn’t just the owner; it’s legally the author. The employee never held rights to assign, and never gets the termination-of-transfer rights that ordinary authors keep. The fights here are about the boundaries: was the creator really an employee, and was the work really within the scope of the job? The full test — including the Supreme Court’s agency-law factors from CCNV v. Reid — is in Work made for hire, actually explained.
Patents: the inventor owns, absent assignment
For patentable inventions, the default flips completely. American patent law vests ownership in the individual inventor, and employment alone does not change that. The Supreme Court said so unambiguously in Board of Trustees of Stanford University v. Roche Molecular Systems, 563 U.S. 776 (2011): even federally funded university research belonged, in the first instance, to the human inventor — and Stanford lost rights to a valuable HIV-testing patent because a competitor’s assignment paperwork was worded better than its own. That single case explains why every technology employer now insists on a signed invention-assignment agreement. What those agreements say, and the two-word drafting difference that decided Stanford v. Roche, is covered in Invention assignment agreements: what you’re actually signing away.
Trade secrets: the employer’s by nature — mostly
Trade secrets developed on the job — customer lists, processes, formulas, internal tools — generally belong to the employer, because the employer is the one taking reasonable measures to keep them secret and deriving value from that secrecy. But the law draws a critical line: your general skill, knowledge, and experience are yours, and they walk out the door with you. An employer can stop you from taking the source code; it cannot stop you from being a better engineer than when you arrived. Where exactly that line falls — and what happens when a departing employee gets it wrong — is explored in protecting trade secrets when employees leave and throughout our trade secrets case archive.
The employment agreement is the real answer
Because the defaults are inconsistent, employers paper over them. The standard package — usually called a Proprietary Information and Invention Assignment Agreement (PIIA) — does several things at once: it assigns inventions and works to the company, imposes confidentiality duties, requires you to disclose inventions, and asks you to list prior inventions you’re keeping out of the deal.
Two practical consequences follow:
- For employees: the document you signed on day one, probably without reading it, is usually more important than any default rule. Dig it out before you build anything on the side, negotiate a new job, or leave to start something.
- For employers: missing or badly drafted assignments are among the most common — and most expensive — IP failures. Investors check. Acquirers check. A company that can’t show a clean chain of title from every founder, employee, and contractor faces delayed or repriced deals, a problem dissected in IP assignment gaps and who owns your startup’s IP.
What if there’s no agreement? Hired-to-invent and shop rights
Suppose no assignment was ever signed. For patents, two judge-made doctrines can still give the employer something.
Hired to invent. If you were employed specifically to solve a particular problem or create a particular invention — not just to do general engineering work — courts imply an obligation to assign the resulting invention to the employer. The classic articulation comes from United States v. Dubilier Condenser Corp., 289 U.S. 178 (1933): an employee hired “to invent” holds the resulting patent in trust for the employer, while an employee hired for general duties does not. The doctrine is narrow and fact-intensive, which is exactly why employers prefer contracts.
Shop rights. If you invented on your own initiative but used the employer’s time, equipment, facilities, or materials, the employer typically gets a shop right: a nonexclusive, royalty-free, nontransferable license to practice the invention in its business. You keep the patent; the employer just can’t be sued under it. A shop right is a consolation prize for the employer — it can’t be sold, and it doesn’t stop you from licensing competitors — which, again, is why written assignments dominate.
State statutes: the carve-outs employers can’t contract around
Broad assignment clauses run into a wall in roughly ten states, which have enacted statutes making it unenforceable to demand assignment of inventions an employee develops entirely on their own time, without employer equipment, supplies, facilities, or trade secrets — unless the invention relates to the employer’s business or actual or demonstrably anticipated R&D, or results from work the employee performed for the employer.
The best known is California Labor Code § 2870, which effectively sets the national template (Washington, Illinois, Minnesota, and several others follow the same pattern, and New York joined in 2023). If you work in one of these states, some portion of your off-hours creativity is protected no matter what your contract says. The statute’s exact mechanics, its two big exceptions, and the required employee notice are broken down in California Labor Code § 2870, explained.
Note what these statutes do not protect: anything built with company resources, anything related to the employer’s business, and anything flowing from your assigned work. For a $200,000-a-year machine-learning engineer at an AI company, “unrelated to the employer’s business” is a small island.
Side projects: the question everyone actually asks
The most common real-world version of this whole topic is: “Can my employer claim the app I’m building on nights and weekends?” The analysis comes down to three questions — what your agreement says, whether you used any employer time, equipment, or confidential information, and whether the project relates to the employer’s business or your work for it. “I built it at home on my own laptop” is necessary but not sufficient; relatedness is the trap that catches most developers. The full three-question analysis, the developer-specific pitfalls (company GitHub accounts, CI pipelines, open-source policies), and a practical hygiene checklist are in Can my employer claim my side project?.
Contractors and freelancers: opposite defaults
Everything above assumes an employment relationship. Independent contractors flip the defaults. A freelancer’s copyrightable work is not automatically a work made for hire — it only qualifies if it falls within nine narrow statutory categories and both parties signed a written work-for-hire agreement. A contractor’s patentable inventions stay with the contractor absent an express assignment. The practical result: businesses that pay contractors handsomely and assume they own the output often own nothing but an implied license.
The employee-versus-contractor line, and how to paper each relationship correctly, is covered in contractor vs. employee IP ownership. For the single most common fact pattern — a business that hired a freelance designer and now wonders who owns the logo — see who owns your logo when a freelancer designed it.
Universities: a third set of rules
Academic settings scramble the analysis again. Universities claim inventions through policy documents incorporated into employment, the Bayh-Dole Act governs federally funded research, faculty often keep copyright in scholarship under carve-outs, and students — who usually aren’t employees at all — present their own puzzle, especially when a dorm-room startup grows out of coursework or a funded lab. The distinct rules for professors, researchers, and students are laid out in university, professor, and student IP ownership. Stanford v. Roche itself, remember, was a university case.
Leaving: what you can take, and what follows you
Employee IP questions get sharpest at exit. When you quit — especially to join a competitor or start one — three things travel with you: your general skill and knowledge (protected), your contractual obligations (confidentiality survives; holdover clauses may claim inventions conceived shortly after departure), and, if you’re careless, your former employer’s trade secrets (actionable). California’s refusal to enforce non-competes changes the leverage but not the trade-secret rules, as explained in are non-competes enforceable in California and non-competes vs. trade secrets.
The clean-exit playbook — timing your resignation, what to disclose, what never to copy, and how courts treat work you “finished in your head” — is in quitting to start a competitor.
What each side should do this week
If you’re an employee or about to become one: find and reread your signed agreement — especially the assignment clause’s temporal scope, any holdover language, and the prior-inventions schedule you probably left blank. Before starting anything on the side, run the three-question analysis above, keep the project on your own hardware and accounts, and if it matters to you, ask for a written carve-out. Assume disputes are decided by documents and commit timestamps, not by fairness.
If you’re an employer or founder: audit whether every founder, employee, and contractor who has touched your product actually signed the right document, with present-assignment (“hereby assigns”) language rather than a bare promise to assign later. Contractors need actual assignments, not just work-for-hire labels. Include the state-required statutory notices, collect prior-invention schedules at onboarding, and fix gaps now — a signed confirmatory assignment costs a few hundred dollars today and can cost a re-priced financing later.
A quick map, by situation
| Your situation | Default rule | What usually controls instead |
|---|---|---|
| Employee, copyrightable work, within job scope | Employer owns (work made for hire) | The default itself — plus scope fights |
| Employee, patentable invention | Inventor owns (Stanford v. Roche) | Signed invention-assignment agreement |
| Employee, invention with no agreement | Inventor owns | Hired-to-invent doctrine; shop rights |
| Employee, off-hours unrelated project | Varies by contract | State statutes (CA § 2870 and kin) |
| Independent contractor, any IP | Contractor owns | Written assignment (WFH clause alone often fails) |
| University researcher | Inventor owns, in theory | University policy + Bayh-Dole + assignment docs |
The bottom line
There is no one rule for who owns what you create at work — copyright defaults to the employer, patents default to the inventor, and trade secrets belong to whoever keeps them secret, with your general skill always remaining yours. Contracts override nearly everything, state statutes like California’s § 2870 override some contracts, and contractors live under opposite defaults from employees. If you’re an employee, read your invention-assignment agreement before you build; if you’re an employer, make sure every person who touches your IP has actually signed one. The deeper guides linked throughout — and our patents case archive — show how these rules play out when real money is on the table.
This article is general legal information for educational purposes only. It is not legal advice, does not create an attorney-client relationship, and may not reflect the most current law in your area. Employee IP ownership disputes turn on specific facts. For advice about your situation, consult an attorney licensed in your jurisdiction.
Frequently asked questions
Does my employer automatically own everything I create at work?
No — the default rules differ by type of intellectual property. Copyrightable works you create as an employee within the scope of your job belong to the employer automatically under the work-made-for-hire doctrine. Patentable inventions are the opposite: the individual inventor owns them unless a valid assignment agreement says otherwise, which the Supreme Court confirmed in Stanford v. Roche (2011). Trade secrets developed on the job generally belong to the employer, though your general skill and knowledge leave with you. In practice, most disputes are decided by the invention-assignment agreement you signed at hiring, not the defaults.
Who owns a patent for something an employee invents?
By default, the inventor does. U.S. patent law vests ownership in the individual inventor, and merely being employed — even being paid to do research — does not transfer title to the employer. That is why nearly every technology employer requires a signed invention-assignment agreement (often called a PIIA) transferring inventions to the company. Two narrower doctrines can also apply without a contract: the hired-to-invent doctrine, when you were employed specifically to solve that problem, and shop rights, which give the employer a nonexclusive license when you used company time or equipment.
Can my employer claim things I make on my own time?
Sometimes, depending on your agreement and your state. Broad assignment clauses often reach inventions made during your employment even off-hours, but roughly ten states — including California (Labor Code § 2870), Washington, Illinois, and Minnesota — void assignment of inventions you develop entirely on your own time, without employer resources, that don't relate to the employer's business or result from your work. If your side project uses company equipment, relates to what the company does, or grew out of your job duties, the employer can usually still claim it despite those statutes.
Do independent contractors keep the IP they create for a client?
Usually yes, absent a written agreement — the opposite of the rule for employees. A contractor's copyrightable work is not automatically a work made for hire; it only qualifies if it falls within nine narrow statutory categories and both sides signed a work-for-hire agreement, and patentable inventions stay with the contractor unless expressly assigned. Businesses that hire freelancers without signed IP assignments often discover, years later, that they merely have an implied license to use the work rather than ownership of it.
