Legislation Assemblyman Craig Coughlin sponsored to protect employee rights to the ownership and usage of inventions developed entirely on the employee’s own time and without using an employer’s resources gained approval Monday in the General Assembly.
“The goal is to preserve an employee’s common law rights to the exclusive ownership and usage of any employee invention totally unrelated to the job functions of the employee and created wholly without using any employer resources,” said Coughlin (D-Middlesex). “Under current law in New Jersey, nothing prevents an employer from acquiring the rights to any such employee invention through the express terms of an employment contract. This bill would prevent the employer’s acquisition of rights to the invention through such a contract and preserve the employee’s rights to his or her own invention.”
The bill (A-492) would prohibit an employment contract between an employee and employer that requires the assignment by the employee of any employee invention developed entirely on the employee’s own time and without using the employer’s resources. However, this prohibition shall not apply to any such invention that: (1) relates to the employer’s business or actual or demonstrably anticipated research or development; or (2) results from any work performed by the employee on behalf of the employer.
To the extent any provision in an employment contract applies, or intends to apply, to any such employee invention falling under the scope of the bill, the provision shall be deemed against the public policy of this state and shall be unenforceable.
“This concept is simple – if someone invents something on their own free time and using their own resources, their employer has no right to claim that invention,” Coughlin said. “People deserve credit for the creativity and innovation on their own time.”
The bill further provides that, outside the context of an employment contract, if an employee voluntarily offers to the employee’s employer an opportunity to acquire any of the employee’s rights to an invention, following the development of the invention, which development may include the idea or concept for the actual production of the invention, the employer shall have no more than nine months from the initial date of the employee’s offer to the employer to accept or reject the opportunity to acquire any rights.
“After this period, the employee shall retain all of the employee’s rights to the invention, and the employer shall be barred from any further opportunity to acquire any of the rights,” Coughlin said.
The measure, which the Assembly passed unanimously, now awaits Senate consideration.