Generally speaking, unlike inventions and patent rights, copyright belongs to the creator of the work, even if he or she is an employee of a company and makes the creation as part of and in execution of his or her employment contract. Software is an exception to this rule.
The French Intellectual Property Code (CPI) stipulates that copyright in software automatically belongs to the employer of the software’s creator, unlike the copyright regime applicable to literary and artistic creations (photos, text, drawings, etc.), if the software is created by the employee in the course of his or her duties or on the instructions of his or her employer.
In application of the law, the economic rights to this software are automatically vested in the employer, who alone is entitled to exercise these rights, without the need for a contractual transfer of rights.
Under this exceptional system, the employer is entitled to the economic rights to the software. On the other hand, the employee retains the moral rights. Unlike the regime for employee inventions, there is no provision in the CPI for additional remuneration of the employer for the benefit of the employee who creates the software.
On the other hand, when the software is created by the employee outside the scope of his or her duties, i.e. outside the framework of his or her general or specific missions, as set out in his or her employment contract, job description, annual objectives, as part of a one-off mission, etc., the software (moral and economic rights) remains the property of the employee creator. The employer wishing to acquire the rights must make an offer to purchase the software, which the employee is free to accept or reject. Where the software has been created outside the scope of the employment contract, the general system for transferring copyright, which stipulates that the transfer of economic rights to the software may be total or partial, is likely to apply.
Such a transfer requires agreement on the transfer price. Here again, the software regime is an exception, since unlike the transfer price of copyright on traditional creations, which must be proportional to the revenue from the sale or exploitation of the work, the transfer price of software can be fixed.
In practical terms, the question that may arise when an employee creates new software is whether this was done within or outside the scope of his or her duties (i.e. as identified in the employment contract, in the job description or on the occasion of assignments entrusted to him or her).
The employee cannot be both judge and jury in this classification (within or outside the scope of his duties): this is why it is stipulated in the employment contract that if the employee creates software that he considers to have been made outside the scope of his duties, he will notify his employer (as for an invention made outside the scope of his duties).
“The Employee undertakes, in addition to not divulging them, to declare to the company all software designed by the Employee outside of his duties, this declaration being equivalent to an offer of transfer.”
Case 1: If the employer disagrees with this classification of software created outside the scope of :
In order to take advantage of this automatic attribution of economic rights to the software, the employer must establish that the employee who created the software created it as part of his duties within the company, under an employment contract. In some cases, this may prove difficult, as the duties performed do not necessarily include computer development or programming. In order to avoid any disputes, and to ensure that things are clear for the employee, it is therefore important to clearly define in the employee’s employment contract, in the job descriptions and in the objectives given to an employee, the aforementioned IT development or programming assignments.
Case 2: If the employer agrees with this classification of software created outside the scope of duties, the employer
We have stipulated that the employer has 15 days contractually to make known whether he is interested in the software, and then to make an offer of the purchase price. In accordance with the law, the employee is free to accept or refuse the offer. It should be noted that this period is very short compared with what is legally required for inventions (4 months), this being a choice made by certain companies so as not to penalize employees who create software outside their functions in the development and exploitation of their software.
Read also: Employee invention policy
“Within 15 days following the Employee’s declaration to the company of the design of the software conceived by him outside his duties, the company will inform him of its position (i.e., whether or not it is interested in the offer to transfer said software).”
Conclusions:
As with inventions, the transfer of software created by an employee in the course of his or her duties is automatic. However, unlike inventions, it is not subject to additional remuneration.
When the software is created by the employee outside the scope of his or her duties, he or she enjoys the same rights to it as any other creator of intellectual works. This system confirms the importance of defining the employee’s missions in his employment contract or in the projects entrusted to him, particularly when they directly or indirectly involve the creation of software.
In all cases, the employee who creates the software must make a declaration to his or her employer when the software is created. This gives the employer the opportunity either to contest the classification of the software as “outside the scope of the employee’s duties”, or to make a buyout proposal if the software interests him or her. If the software is indeed “outside the scope of the employee’s duties”, the creator of the software is free to accept or refuse the employer’s buyout offer, if the price, for example, is not to his or her liking.
NB: These provisions do not apply when the creator is self-employed and works for the company (freelance, auto-entrepreneur or service provider). In such cases, ordinary copyright law would apply. The regimes for collaborative works, collective works or “co-ownership” could, where applicable, apply if the independent creators work in coordination with the company’s employees on the analysis, design and actual development of the software. In these complex configurations, the service contract may provide for the assignment or concession of certain rights, taking into account the applicable copyright regime for each creator, depending on his or her status. .
