Worrying About Employment Contracts?

An anonymous reader wonders: "I was preparing to accept a software developer job at a California company and was put off by the contract which claimed ownership of any ideas I create (on my own time or at the company) during my stay at the company and required me to inform them of any ideas (related to the company or not) during my employment and for a year afterwards. I've found references to a couple of instances where this became a legal problem for the developer. Is this something to worry about?"

Contracts are what the parties involve agree on.

[Ihlosi]

If you don't like to have your ideas pwned by some corporation, ask them to take the offending lines out of the contract. If they refuse, look for a different job.

Yes.

[Anonymous Coward]

Carefully strike through the offending lines, initial them, and hand the contract like that back to the company. Now the ball is in their court. They can see what they (their lawyers) were asking is unreasonable, and initial the changes as well, or they can get back to you. Then negotiation starts. But whatever you do, don't just blithely sign it and think "oh, that'd never be a problem anyway". The very purpose of contracts existing is to make certain that things won't become problems.

Evan Brown

[eric76]

Evan Brown [unixguru.com] ran into this problem.

He lost his job and spent quite a while in court fighting it.

His contract used the word "inventions" instead of "idea" but they interpreted "invention" to include just about anything.

Some other comments...

[kiwimate]

Also check out [slashdot.org] previous [slashdot.org] Ask Slashdot [slashdot.org] articles [slashdot.org]. No, not identical to what you're asking, but still some good points.

Also consult California law.

[FooAtWFU]

CALIFORNIA LABOR CODE SECTION 2870
INVENTION ON OWN TIME - EXEMPTION FROM AGREEMENT

(a) Any provision in an employment agreement which provides that an employee
shall assign, or offer to assign, any of employee's rights in an invention to employee's employer shall
not apply to an invention that the employee developed entirely on employee's own time without
using the employer's equipment, supplies, facilities, or trade secret information except for those
inventions that either:

(1) Relate at the time of conception or reduction to practice of the invention to
the employer's business, or actual or demonstrably anticipated research or development of the
employer; or
(2) Result from any work performed by the employee for the employer.

(b) To the extent a provision in an employment agreement purports to require an
employee to assign an invention otherwise excluded from being required to be assigned under
subdivision (a), the provision is against the public policy of this state and is unenforceable.

Re:Also consult California law.

[Matt Perry]

Thanks, but in the future please provide a link to the official source. Here's the relevant text from the California legislative information web site [ca.gov]. There's a bit more text than what you've posted. This is from the CA labor code [ca.gov].

Re:Probably unenforceable anyway

[exp(pi*sqrt(163))]

> these types of contract terms have ruled unenforceable time and again by the courts

This is said frequently. But I'm yet to see any kind of confirmation.

California law

[Todd Knarr]

If it's a California-based company, the relevant law is California Labor Code 2870-2872 [ca.gov]. Those sections put limits on the extent to which that IP agreement is legal. Any attempt by the agreement to exceed those limits is illegal and void as a matter of law according to 2870(b). The employer is also required to give you, in writing per 2872, a notice that any language in the agreement does not apply to inventions which meet 2870's criteria.

California Business and Professional Code section 16600 [ca.gov] is also relevant to the oh-so-common non-compete clauses.

Note that California's position is that, since these are law, the fact that an employee agreed to them does not provide an out for the employer. Just to be safe, however, when I had to sign those papers I wrote in a term saying that the agreement was subject to the limitations of those two laws before I signed.

Re:Also consult California law.

[Matt Perry]

So, you can only read hyper-links nowadays?

I can read text just fine but that doesn't mean that the text I'm reading is accurate or complete. Searching for "california labor code section 2870" returns a lot of results with the link to the official text several results from the top. A lot of the pages in the top of the results only show part of the section in question or paraphrase it. Although it's great that FooAtWFU's comment is getting modded up a citation would have helped an interested party to investigate further. Since Slashdot's comments are archived it's likely that this article will come up in someone's search results in the future. It would be best to give them as complete a picture as possible so they don't submit the same question to Slashdot in the future looking for more information.

If FooAtWFU doesn't like my advice he's free to ignore it.