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Businesses Patents The Almighty Buck

Employee Patent Compensations? 89

Posted by Cliff from the if-you-invent-do-it-on-your-own-time dept.
Anonymous Coward asks: "My employer has recently filed a patent application for something I invented. As compensation I am being given the statutory $1 for the assignment and a shiny brass plaque if the patent(s) is awarded. Is this typical for North American companies? I did sign a no compensation and automatic assignment type employment contract and while I was willing to accept that technically, I'm owed nothing, this strikes me as cheap, greedy, and backward thinking on my employers part. I've Google'd and read and this action seems archaic, am I wrong and just full of myself? Your thoughts please!"
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Employee Patent Compensations? More

Employee Patent Compensations?

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  • My thoughts... (Score:5, Funny)

    by Anonymous Coward on Monday October 27, 2003 @09:30PM (#7324444)
    My thoughts are that the Anonymous Coward link shouldn't have an email address if Bill Keegan wants to remain anonymous!

  • You're wrong, but... (Score:2, Insightful)

    by Cranx ( 456394 )
    ...if the patent proves valuable, and they don't feel the need to compensate you directly, you should be viewed as an exceptionally good catch for some other company.

  • Motivations (Score:3, Interesting)

    by addaon ( 41825 ) <(addaon+slashdot) (at) (gmail.com)> on Monday October 27, 2003 @09:31PM (#7324448)
    Why would they give you more than the minimum required, if you agreed to that minimum? Does it gain them anything? Are you honestly going to work less now because they didn't give you an unnecessary bonus?

    (Disregard the above if your company is non-for-profit, employee-owned, or determined to get sued by stockholders.)
    • People have been known to not work as hard when they feel like their employer is taking them for granted. It's shocking, I know, but true.

    • Re:Motivations (Score:3, Informative)

      by Kanagawa ( 191142 )
      Because its good for business?

      They should give more than the minimum to give this very valuable employee solid motivation to continue his fine work. Nikola Tesla came to the U.S. to work for Edison, who made life unpleasant by failing to reward Tesla for his excellent work. Tesla eventually left and invented [mall-usa.com] A/C dynamos for Westinghouse, which helped him defeat Edison in the electricty market. Eventually making the Westinghouse corporation became so powerful J.P. Morgan and G.E. eventually gave up competi


    • Why would they give you more than the minimum required, if you agreed to that minimum? Does it gain them anything? Are you honestly going to work less now because they didn't give you an unnecessary bonus?

      Let's flip this around. If the company sees no need to give more than the minimum required, then why should the employee see any need to produce more than the minimum required? I mean, if I knew that my company wasn't going to give me bupkus for coming up with something worthwhile enough to patent, I

  • It is somewhat greedy (Score:2, Funny)

    by Anonymous Coward
    My company pays up to $2500 or so per inventor named on the patent, up to 3 inventors. If there are more than three, then they take the max 7.5k and divide it equally.

    Just a number. Doesn't mean I'd be any richer than you, after paying taxes and all, but at least I can buy my own shiny new plaque. :)

  • not exactly standard... (Score:5, Informative)

    by jrstewart ( 46866 ) on Monday October 27, 2003 @09:33PM (#7324464) Homepage
    I think the usual practice in america is more like a couple thousand dollars and a shiny brass plaque.

    I wouldn't lose sleep over the bonus. Instead, remember to mention your patent at your next performance review. Even if you don't get a bonus from it directly it may be a useful bargaining chip for future compensation.

    • Re:not exactly standard... (Score:4, Funny)

      by DAldredge ( 2353 ) <SlashdotEmail@GMail.Com> on Monday October 27, 2003 @10:48PM (#7325053) Journal
      A couple thousand? Are you crazy! That would buy almost half of an offshore coder!

      Any you wonder why IT/IS jobs are going overses! Bunch of gready SOBs!!!
      • Poll: 75% of Palestinians support Haifa restaurant attack:

        Poll: 99% of the people think you made this up.
        • Then 99% of people would be wrong. It was a poll taken by a palistinian polling group and it did say that about 75% of the palistinians polled supported the murder of 23 israelis in Haifa (including I should point out several israeli arabs) The resturant in haifa was co-owned by an arab family.
          • It would be interesting to know what
            percentage of Israeli citizens also
            supported the attack.
          • Always remember that the Israelis out-kill the Arabs almost 3 to 1 (last time I checked). Of course bombing a whole apartment block as part of an assassination isn't terrorism, because it was committed by a government.

            Or how about using a helicopter to fire rockets into a car carrying a three-year-old child?

            Don't get me wrong, I certainly don't condone the killing of civilians, in fact in general I don't condone killing at all. But neither side in this conflict is in the right, and the sooner people rea
    • In the drug industry there are now certain states that mandate employes of universities and drug companies get a wee percentage of the profits from any drug they find, even if it's on the employer's nickel. If I remember right this got started when the guy who found Prozac got virtually no compensation except for some additional job security and maybe a bonus. Two percent may not sound like much, but two percent of, say, $240 million will almost send three kids to a private four-year college. Heck, even

    • Close, but no plaque (Score:1, Informative)

      by Anonymous Coward

      Where I work, it's $1000 per co-inventor on filing and $1000 when it issues. If there are more than 4 co-inventors they split $4000.

      But no shiny plaque. ;-)

      AC

  • one dollar!!! (Score:5, Funny)

    by sydlexic ( 563791 ) on Monday October 27, 2003 @09:34PM (#7324467)
    you luck bastard. all i got was a pile of stock options.
  • My company rewards employees by enlisting their IP in the broadest and most questionably interpreted ways possible to fight the good fight. We use your inventions to battle against Linux piracy and BSD-thieving Apple Republicans.

    Hi, I'm Darl McBride. And here at SCO, we Think Different (tm).

  • "My employer has recently filed a patent application for something I invented."

    And yet you still left out something very important - you invented it on company time (or even used a little bit of company time) and you've been on the payroll since before concieved of the invention, and , in fact, you were employed in order to benefit the company - including anything you invent while working for the company.

    You have been paid for, are being paid for, and will likely continue to be paid for the invention - it's called a salary or paycheck.

    I'm sorry if you didn't understand the terms of your employment.

    Besides, you can get the answer to your question from Google, which will show you that it's a fairly commonly asked question

    As far as what is typical in the industry - typically the inventor gets nothing but name recognition. If the invention makes the company a million, they tend to treat you better, but it still shows as zip on your paycheck (except your raises may be slightly higher than usual for awhile)

    You might be able to work something out if you are a contractor and can show that you developed the invention for general use in your contracting business, and not for this specific client, but then you get to be the cost bearer of obtaining the patent, and likely (as with the vast majority of inventions) you will never recoup those costs.

    It's better to put the invention down on your resume, and work it from the angle of, "I can do good things for your company" rather than trying to say with your current employer, "Hey, where's my piece of the pie?". Likely your piece of the pie will be somewhere outside the office very shortly thereafter.

    -Adam
    • I tend to agree. Now the poster doesn't seem to be saying, "Gee, I've been screwed. Where do I sue." but rather, "What is the norm, if any, for compensating employees for inventions."

      What I find interesting is the way "invention" and "patent" seem to make people think they are doing something different than others. Most knowledge workers are financially compensated in return for using their brains and the company's resources to create something of value. In this case the company feels that the best way of
    • I think the author understands very well the terms of his employment. I thin his main beef is that HE has gone out of his way to do somethins a little special for the company, so why isn't the company willing to do the same in return? After all if this invention is important enough to patent, one would think that keeping him on at the company would be very important. If the company is showing him no loyalty and appreciation, it'll be VERY easy for him to jump on to the competitor's payroll when they come

      • Re:You misunderstand, I think. (Score:4, Insightful)

        by ConceptJunkie ( 24823 ) on Monday October 27, 2003 @11:49PM (#7325480) Homepage Journal
        That's corporate life in the 21st century (and has been for a while). Loyalty is an outdated idea. Companies are showing less and less loyalty to employees, and employees are returning the favor.

        As far as I'm concerned, the difference between being a full-time employee and a contractor boils down to compensation. Salaried employees trade a higher hourly rate for a fixed salary and additional non-monetary but quanitifiable benefits. Also, the government treats you differently for tax purposes. Period.

        Anything else is above and beyond the call. The company will most likely lay the employee off in a heartbeat if they feel the need, and the employee will jump ship at a moment's notice for better pay or a more interesting job. Companies have forgotten how much more valuable a properly-trained and experienced senior employee can be, and employees have forgotten the less tangible benefits of staying with a firm for an extended period of time.

        Like almost everyone else in modern American business, no real attention is being paid to the long-term. Only short-term gains are considered. An employee will bail for a 10% increase in pay, while a company will treat people like a commodity and swap them around and dump them for the slightest reason.

        Unfortunately, in this climate, intangibles don't count for much, because you can't depend on loyalty being rewarded with loyalty. The companies are to blame when the concept of downsizing and commoditization of employees because more important than treating people like people. Now the shoe's on the other foot and employees aren't giving loyalty either, because they don't expect they will get it.

        Unfortunately, the culture now is very much a mercenary culture, and it is stuck in a vicious circle being fed by things like frequent job changes, outsource overseas, the increasing reliance on temp workers, etc.

        So, while the company doesn't _owe_ you anything more than a handshake and maybe a plaque (in addition to your salary), if they are wise, they will cultivate your obvious value, and you, in turn, should reciprocate, building a stronger and more valuable relationship.

        In my case, I have at times, not shown as much loyalty as I maybe should have, because I am not a patient person, and am unwilling to suffer through a project of a year or more on the chance that the next one will be something I actually want to do. By the same token, I have been lied to, indirectly at least, and treated very unfairly on more than one occasion. The biggest problem I have had, as a long time (15+ years) expert developer that does not want to go into management, is being put in a situation more appropriate for a junior-level programmer, where I cannot utilize my expertise in a way that provides interest to me nor maximizes the company's benefit of my long years of experience. In my current job, I have literally been told nmy work is too good. If every piece of what I develop is not understandable by every programmer (at a shop that is light-weight on progammer talent), then it shouldn't be done that way. Given the impressive resume that I provide, wiuth its emphasis on improving the status quo, and developing sophisticated tools and solutions, it seems rather dishonest to state that I am a good match for the position, because after almost 6 months, I know I clearly am not. If and when I find alternative work, I will take it immediately, despite the fact that I hate to leave after such a short time, and yet, if the culture of the company (for which software development is of peripheral importance, as evidenced by the quotes "We are a bunch of hacks. This is a garage shop." They do brute-force, copy-and-paste work which would have looked archaic 10 years ago) had been described to me honestly, I would have realized it was a bad match up front. One thing I can be honest about is that I get bored easily and I am neither happy or productive when I am bored. I don't think it's fair to hire someone with 10+ years of C++ experience as a C++ p

        • Companies have forgotten how much more valuable a properly-trained and experienced senior employee can be, and employees have forgotten the less tangible benefits of staying with a firm for an extended period of time.

          Well written, but I would differ on this point. From the perspective of an employee, I and likely most others haven't actually forgotten or don't know about the benefits of staying with a firm for an extended period of time, it's just that those benefits have all but dried up. I hear of a few

    • I'd add this too: most inventions never make a dime, and very few are ever more than modestly successful.

      Companys aquire lots of patents that are never turned into products. They just aquire them for the same reason a porcupine grows quills: to throw them in a predator's face (or maybe they make them look good to a potential mate). For such purposes they are worth something but not very much.

      Idea people are often like to overvalue ideas (thus an obsession with patents, NDAs etc). Ideas are important,
    • My Uncle worked at DSC, now Alcatel, and when he invented an idea for software reverse-engineering (note, this idea is not related to telecommunication), on his own time, and begun before employment by DSC, they rewarded him with a large threat and later a pink slip. Then tried to sue him for it. Read on at Unixguru.com [unixguru.com] This has been going on in excess of four years, and, as you might imagine, has greatly deteriorated my respect for corporations. I would not treat your employer as a friend but, like Stienm
    • I agree this is the current state of affairs. I also agreed in non-compete, non-disclosure, and signing my IP over to them when I started my job. So yes, I'm getting paid and in return they take my IP from me.

      But is this the way it should work? I'd say (judging from what I've read, and the comments here) that it's pretty common. Is this the best thing for all parties involved? I'm not talking about a "Do they work that way now?" or even a "What can we change?" point of view. The first has been answer
      • " Is there a better balance than mandatory IP surrendering?"

        You say that as though the employee has some rights to the IP that he/she has to give up. This is the problem - the employee owns none of the "intellectual property" that they are being paid to produce for the company.

        In our current age, ideas are important, not people. People produce ideas that can be bought, sold, traded, and sued for. The people themselves are but producers - once the milk is given to the machine, the cow has no recour

    • As far as what is typical in the industry - typically the inventor gets nothing but name recognition. If the invention makes the company a million, they tend to treat you better, but it still shows as zip on your paycheck (except your raises may be slightly higher than usual for awhile)

      That's not been my experience (at least not theoretically -- my last employer filed two patents for things I invented, and then fired me for no reason).

      Many high-tech companies at least really want their employees to invent

    • As far as what is typical in the industry - typically the inventor gets nothing but name recognition.

      Does the legal concept of moral rights - ie, (as I understand it) acknowledgement of creatorship, if not legal ownership of an item - extend to inventions?

      AFAIK moral rights have been introduced (via legislation) for creative works such as books, paintings or screenplays, but I don't know about non-creative works.
    • This is the sad truth. The independent inventor in American is dead. Patents cost too much and research is too expensive. The company you work for has no obligation to give you anymore than what you got for your invention.

      --rhad

    • including anything you invent while working for the company.

      This uninformed B.S. Even if it says as much in some contracts. A contract must be fair and equatable, if the inventor does not receive something for their patent, the contract is unfair. Unfair contracts are unenforcable and any court will throw out such contracts.

      1) A patent belongs to an individual not a corporation, Companies cannot invent and cannot own patents. People invent things, not companies. The company cannot simply register the
      • While this information might be true in the UK, it is almost the exact opposite in the United States. Companies can and do own lots of patents, which are obtained from the work of employees. I wouldn't exactly call them free, since they are 'works for hire' and the employee developed it on company time. As for companies claiming ownership of works developed on an employee's own time and equipment, I believe the employee would have a good case to fight this in court (assuming they could afford to).

  • Standard Practice (Score:4, Informative)

    by the eric conspiracy ( 20178 ) on Monday October 27, 2003 @09:47PM (#7324565)
    It's a standard part of US employment law that if you are indeed an employee rather than an independent contractor that any intellecual property that you generate does in fact belong lock stock and barrel to your employer. They don't even owe you the shiny dollar.

    Some companies are more generous, offering a few shares of stock or whatever.

    I know in Europe you have a somewhat better situation, especially if the invention is worth a LOT of money in the long run, but how far that goes I don't know.

    I never thought it was a big deal in my job - generating these things was what I was being paid for, and in reality very few patents ever turn out to be commercially valuable anyway.

    • Actually, I believe they DO owe you the dollar. Because patents are inventions that come from people, not corporations (i.e. a corporation can not be listed as an "inventor"), I believe that patent law says that they must give you some "compenstation" to assign your rights to the company. This has traditionally been a dollar (or whatever other bonus you may have received). But I don't think they can hold a gun to your head.

      But hey, my employee has paid me numerous bux for my patent. In my opinion, the r

    • Re:Standard Practice (Score:1, Informative)

      by Anonymous Coward
      Gather round, folks. Take a good look. Once again we see the dangers of lumping together all sorts of things under the phrase "intellectual property."

      See this pathetic moron ? He just said " It's a standard part of US employment law that if you are indeed an employee rather than an independent contractor that any intellecual property that you generate does in fact belong lock stock and barrel to your employer." Of course he probably meant to say that is was standard part of Copyright Law to treat "work

      • "employer owns patents" stuff purely comes as a result between a contract between you are your employer, subject to all the uncertainties of contract law without even getting into the additional problems the employment relationship brings into it.

        Who is stupider than a pathetic moron then? Truly it must be yourself for asserting such nonsense.

        Without a contract an employer can assert any number of reasons that it might own the invention. One is the "hired to invent" assertion which gives the employer the

  • Clients. (Score:3, Interesting)

    by man_ls ( 248470 ) on Monday October 27, 2003 @10:20PM (#7324838)
    A client of mine, was a former Pratt & Whitney rocket scientist. He invented control systems and fuel systems for around a dozen rockets/engines, and has about 5 patents to his credit -- all for his employer.

    He's got plaques to prove it, but that's about it. And he seemed pretty damn proud to have those, and loved explaining when I asked about them.

    *Shrug* Was pretty cool to me...they don't *have* to give you anything.

  • My compensation (Score:3, Interesting)

    by Brandybuck ( 704397 ) on Monday October 27, 2003 @10:41PM (#7325004) Homepage Journal
    I get $50 for the disclosure, and $2000 if the filing is accepted. The bonus is $4000 if the patent is in a "targeted" area.

    I'm going to start disclosing a whole bunch of obvious stuff. Not that I necessarily want them patented, but just so our company has a legal record of their being implemented or used. I still can't get over Phillips being granted a patent for something my company had shipped five years prior to their filing. Our solution to the problem was to roll over and cross license our own stuff.
  • Where I work, it's made pretty clear that contractors aren't real people. Nowhere is this more evident than the patent-compensation system. 'Real' employees get a $2,500 bonus. After 5 patents, I believe it's a $10,000 bonus. Not bad. Contractors get NOTHING. Not even a plaque. A guy who works in the same lab as I do has his name on 3 patents, and he has never gotten any recognition whatsoever.

    So... don't expect anything for a patent unless you have an agreement guaranteeing compensation. Companies

  • Fees (Score:2)

    by xpccx ( 247431 )
    Keep in mind they're paying the fees [uspto.gov] associated with the filing and maintanence of the patent.

  • IBM's policy (Score:3, Interesting)

    by random735 ( 102808 ) on Monday October 27, 2003 @11:38PM (#7325388)
    IBM's invention policy is:
    first patent: $1500 when it's filed, another $500 if the patent is awarded
    any patents after that: $750, +$500 if patent awarded.

    Every 4 patents you hit a "plateau" and get a bonus $1250 or so on top of everything else.

    From the posts in this forum, sounds like that's actually a pretty nice system.
  • I have never seen anyone get any money worth worrying about. At SGI. a buddy got a really nice leather jacket. I've also seen stock grants, stock options. Some time off. It helps you get the next big project you want if you can predict the possibility of more IP. Remember, half the time, the IP is used to either prevent competition, or used as a trading card. By trading card I mean one company is given the right to use your patent in exchange for the use of one of theirs. The best advise is to develop
  • It all depends on your employment contract. Like other benefits they differ from company to company and in this climate they're getting stingier.

    Cisco granted money upon filing, money upon grant, provided you were still with the company when it gets granted. Ditto for the plaque as well, I think.

  • For my two patent applications for inventions I created while working for a company associated with the size "Big" and the colour "Blue", which they've filed in two countries, I was permently laid off.

    The unnamed company in question had (at the time at least) a policy where inventors were awarded $2500 US for each successful patent. When I was "surplussed", they decided not to pay up. After making a fuss, they finally decided to pay me $1500 US for both (that is, $1500 US in total).

    So count yourself l

  • You OWE them the patent! (Score:3, Informative)

    by stevew ( 4845 ) on Tuesday October 28, 2003 @05:48AM (#7326809) Journal
    I too have received the obligatory 1 dollar for a patent I helped develop. Consider that under law you did the work for them when you created the invention. Doesn't it make some sense that the invention is rightly owned by the corporation?

    Further, did you pay the 10K to 20K dollars to file the patent? Yeah - the patent itself doesn't cost that much (more like $2k I think) but the lawyers that wrote it did.

    So - what did you have on the line versus the company. You received your normal compensation and the company through in say another $10K on top of your compensation to receive the patent. Seems to me they have a moral right to it too!

    Now - if you did something on your own dime, and the company tried claiming that as well - this is another discussion all together. That doesn't seem to be the case in the initial query though. I happen to live in CA - with all it's OTHER faults (and there are so so many) CA does have a law on the books since around 1980 that if I develop the idea on my own time with my own resources, then NDA or not, I own it.

    That's my two cents worth.
  • I consulted for a large company once, which has/gets lots of patents.

    Every year they have a fancy sit down dinner for the patent holders, with the presentation of the awards for that years patent awards.

    Other than that, I'd say recognition should be in the form of the paycheck.
  • Im a asuming the patent has been applied for and granted in your name ?

    If you already assigned the patent to the company, you are in a weak position, and are relying on the companies good will, the best you can hope for is raising it at your annual review like you would any acheivement.

    If you have not made the assignment you find your self in a good position of negotiating with the company from a position of strength. DO NOT sign over the rights to the patent. Consult a patent agent/lawyer.

    You can nego
  • If a company wants to enhance its value a few inventions and patents can be much more worth while that years of hard work. In todays market IP can be very valuable many companies like Rambus and Qualcomm, while they have products exist mostly as patent holders and receive much of their income/market cap from their patent portfolio. The writer doesn't discuss what type of invention he made, it maybe worthless in the market or it could be worth huge piles-o-cash. I the company gave $2000 or something like

  • Don't do it for free! (Score:1, Insightful)

    by Anonymous Coward
    I'm not sure what the average is. I've seen companies give people nothing and a nice little plaque; the whole organization thought that was bullshit. I've seen people climb the corporate ladder because of them. I'd guess the standard would probably be something like $1000-$2500 award; let's face it money is the only language in business and this is pretty damn cheap, I got "team awards" and "dinners for two" at IBM that were $300 to $500, so when God's own finger reaches from the heavens and touches yo

  • My experience at Sun and HP (Score:1, Informative)

    by Anonymous Coward
    I've been at both Sun and HP, and both have better plans than that. There have multi-stage payouts. First, you get paid for the "invention disclosure" to the company. Next, you get paid when the patent is filed, if the company approves it. Lastly, you get paid when the patent is granted, and the company will throw in the plaque.

    At Sun, I think it was $250/$500/$1000 when I was there, and at HP it's $175/$875/$1750. Nothing like the $1 foolishness you have.

    It's not about any particular patent, but the numb
  • Assuming the obvious stuff (i.e. it was work you did as a company employee at the company's direction on the company's dime), the company doesn't owe you anything beyond your regular paycheck if a patent issues. Nonetheless most companies I've been at have had a practice of giving some kind of recognition when a patent issues. A couple have had written policies where they give some bonus (maybe a few hundred dollars) if the company files a patent application and another bonus (maybe 1k or so) if a patent
  • If you came up with the idea on the job, and suggested it to them, they can use it. Same goes if you signed an agreement saying they can use any other ideas of yours. Them patenting it just means they really like your ideas, since it costs so much to get a patent. Maybe it'll help you get future pay raises. If not, you can mention on your resume that some of your ideas have been patented.

    I for one despise patents, mainly the fact that they can prevent you from using an idea, or punish you after the fact, e
  • In UK Patents Act (Section 40(2)(c) if you must know) an employee can 'sue' for extra compensation when they invent something that provides "outstanding benefit" to their employer and the employer hasn't fairly compensated the employee (eg. they just got their wage and the employer made millions off the invention).
  • It takes a lot of capital (re: money) to get a company off the ground and into the black, not just IP capital. The guys with the money are giving us opportunities to be creative. A patent helps to protect the investment of capital, but doesn't guarantee the viability of a business. I'm listed as inventor on three patents, only two of which are part of a sustainable business. I received stock options that, after 7 years, were actually worth something of signficance. But I received no plaque or any other
  • And, if I "invented" something on company time, would be happy just to be recognized for it.

    They are paying you a salary for your work, aren't they?

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