A couple of months ago, I wrote a post on the subject of over-reaching employment contracts.
Anyway, I promised that I would have the next part up within days and well, it’s been kind of crazy. Between work, articling applications, and being not so well, I haven’t had the time I’ve wanted to blog properly. Resuming now. Apologies offered all around, especially since I’ve been hearing that there are people out there actually reading this! [Comment, please! It doesn't have to be a complete essay, Derek, although I do expect a witty title from you... Also, Diggs are greatly appreciated.]
In the first post, I talked about someone whose employer demands assignment of previous or future competitive IP products of the employee to the employer. Broad time span, but limited applicability.
Let’s look at another scenario:
Employers often extend the IP/non-comp in breadth. In other words, they remove the related/similar/competitive qualifier. Consider this example:
The employee waives or the employer acquires rights to all intellectual property created or developed by the employee during working hours.
Here we see one of the previously contemplated manifestations of this post: “Calling for Clauses of Intent”.
I’ll put that in the simplest terms possible. Clauses of intent in a contract would answer the question, “Why?”
We agree to details A, B, and C. Why? It’s the “why” that the courts will want to know, so why not write why a given condition is stipulated?
Here are my possible answers to the question, why. (I won’t try to answer, why not write why, as the answer probably has something to do with the sort of masochism that led me to take arcane courses like Latin, Symbolic Logic, and Philosophy of Law; and none of us has the time or the volume of scotch to get into that.)
There are two reasons for such a clause: Either the employer is overreaching, simply because they can and this is an opportunity to grasp at the odd diamond that may roll over in the rough; or the employer is using such a clause as a pre-emptive disciplinary measure to prevent employees from doing their own thing on the employer’s bill, such as writing blog entries, creating a novel, developing a screenplay, or writing a non-competing software module. Does my employer really want the intellectual property rights to blog entries I’ve written during lulls at the office? I doubt it. But they do, generally, want to make sure that I don’t manufacture those lulls in order to extract some personal time while on the clock.
Let’s look at a hypothetical:
Jessica Doe is a sales manager at A2Z Logisitics Inc. I could understand if A2Z wanted to claim an IP stake in the marketing materials she helped develop. But Jess works odd hours, as sales managers often do. While on a business trip to Tuktoyaktuk, she wines and dines the shipping coordinator of Ice ‘n Stuff, Ltd. The shipping coordinator is late to the wine and dine appointment, so Jess pulls out her PDA with Bluetooth keyboard and writes a chapter in her labour of love, a science-fiction fantasy romance novel tentatively titled, The Elf’s Staff and the Android’s Black Hole. The shipping coordinator arrives, they have a lovely evening, and Jess makes headway into a north-south transportation logistics contract. Three months later, the deal falls through. A year later, Jess finishes her novel, and it is published.
Let’s assume that A2Z is not doing well and looking for straws at which it can grasp. Jess is leaving the company, seeing that the end is nigh, and that she is going to make some handsome coin from the novel. Whereas there was an assumption that the IP clause, painted in such broad and blunt strokes, was merely a disciplinary device, A2Z now seeks to enforce it and recover some cash. Jess was on company time when she wrote that chapter of the novel, as she is paid for her time while waiting. Is the contract enforceable?
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