Intellectual property assignment clauses in Canadian employment contracts are becoming increasingly aggressive, with employers seeking to claim ownership of virtually everything an employee creates — including personal projects, open-source contributions, and inventions developed entirely outside working hours on the employee's own equipment. While employers have legitimate interests in protecting IP created within the scope of employment, overreaching assignment clauses can stifle innovation and unfairly deprive employees of rights to their own creative work. Canadian law provides some baseline protections for employees, particularly for copyright under the Copyright Act, but the law of inventions and trade secrets relies heavily on the employment contract terms. Understanding what your employer can legitimately claim — and negotiating appropriate exceptions — is essential before signing.
What is a Intellectual Property Assignment?
An intellectual property assignment clause is a contractual provision that transfers ownership of intellectual property created by the employee to the employer. This can cover patents (inventions), copyright (software, written works, designs), trade secrets, and trademarks. The scope of the assignment varies from narrow (only IP created in the course of employment duties using employer resources) to extremely broad (all IP created during the employment relationship, including personal projects).
Red flags to watch for
This language captures personal projects, weekend coding, blog posts, and art created entirely outside work. Canadian courts may not enforce such broad clauses, but litigation is expensive and uncertain.
If you bring existing IP into the employment relationship (prior inventions, personal software, creative works), a broad assignment clause could transfer ownership of pre-existing work to the employer.
Under the Canadian Copyright Act (s.14.1), authors have moral rights including the right of attribution and the right of integrity. A blanket waiver means the employer can modify or use your work without credit or consent.
Some clauses purport to assign IP conceived during employment but reduced to practice after termination. This can capture ideas you develop months after leaving if they were 'conceived' during your tenure.
Unlike some European jurisdictions, Canada has no statutory right to inventor compensation. If your contract doesn't address this, a million-dollar invention earns you nothing beyond your regular salary.
Your legal rights
In Canada, IP assignment in employment is governed by a combination of federal IP statutes and common law. Under the Copyright Act (RSC 1985, c.C-42), s.13(3), the employer is the first owner of copyright in works created 'in the course of employment' — but only for works within the scope of employment duties. The Patent Act (RSC 1985, c.P-4) does not contain an equivalent presumption; ownership of employee inventions depends on the employment contract and common law principles. The Supreme Court of Canada in Comstock Canada v Electec (1991) held that absent a contractual assignment, employee inventions belong to the employee unless the employee was specifically hired to invent. Moral rights under the Copyright Act (s.14.1) cannot be assigned but can be waived. Provincial employment standards legislation does not directly address IP ownership. The common law duty of good faith in employment (Bhasin v Hrynew, 2014 SCC 71) may limit enforcement of unconscionable IP assignment terms.
Questions to ask before you sign
- 1Does the IP assignment cover only work created in the course of my employment duties, or does it extend to personal projects and outside activities?
- 2Is there a mechanism to declare pre-existing IP that I bring into the employment relationship?
- 3Am I asked to waive moral rights, and if so, for which types of works?
- 4What happens to IP I conceive during employment but develop after termination?
- 5Is there any additional compensation for significant inventions or patents beyond my regular salary?
- 6Does the assignment cover open-source contributions I make on my own time?
Disclaimer: This guide is for educational purposes only and does not constitute legal advice. Contract law varies by jurisdiction and individual circumstances. Always consult a qualified legal professional before making decisions based on this information.