Have you ever hired someone to design a web page, write an article for publication, draw an illustration for a book, shoot photographs for your story or a wedding? Or has anyone contributed material to your new book, your new reality TV show, or your new musical composition? If so, have you asked yourself: Who legally owns the work?
Most people mistakenly assume that since they paid for someone to create the work, or since the other individual’s contribution was only relatively a small portion of the work, the person who paid for the work has exclusive copyright ownership. Copyright ownership is extremely important because it determines who receives credit for the work and who controls the use of the work.
The 1976 Copyright Act
According to the Copyright Act of 1976, the copyright ownership “vests initially in the author or authors of the work.” In general, the author is the person who actually creates the work. Therefore, should third parties such as a web designer, a writer, an illustrator or a photographer contribute to your work, under copyright law, they may be considered the copyright or co-copyright owner of the work.
Work Made For Hire (“Work For Hire”)
Although the general rule is that the author is the person who actually creates the work (i.e., the web page, the writing, the drawing, the photographs, etc.), the copyright act provides an important exception to the rule called “work made for hire.” That is, the employer (or the person who hires an independent contractor), rather than the employee is considered the author and owner of the copyright.
There are two distinct ways that a work will be classified as a “work made for hire.” They are the following: 1) the work is created by an employee within the scope of employment; or 2) the work is created by an independent contractor that falls within one of the nine statutory categories.
Works Created By An Employee
A work created by an “employee” within the scope of employment is considered a work for hire. To determine who is an “employee”, the Supreme Court in CCNV v. Reid identified certain factors that characterize an “employer-employee” relationship. Some of the factors include: 1) the employer controls how the work is done by the employee; 2) the employer controls the employee’s schedule in creating the work; 3) the employer is in the business to produce such works; and 4) the employer provides the employee with benefits and withholds taxes.
All or most of these factors characterize a regular, salaried employment relationship. Therefore, should an individual be deemed an employee, the employer is the rightful copyright owner of all the work created by the employee within the scope of employment.
Works Created By An Independent Contractor
Work for hire situations also occur when an independent contractor has been hired to create a specially ordered work. For such a work to qualify as a work for hire, the following conditions must be met: 1) there is a written agreement between the parties specifying that the work is a work made for hire, and 2) the work falls within one of the nine statutory categories: a contribution to a collective work, a part of a motion picture or other audiovisual work, a translation, a supplementary work, a compilation, an atlas, an instructional text, or as answer material for a test.
Therefore, the person who hired the independent contractor, will be deemed the copyright owner only if there is a written work made for hire agreement and the work falls within one of the statutory categories mentioned above.
If the work does not fall clearly within one of the nine statutory categories, a basic work for hire agreement will not be legally sufficient to establish copyright ownership. In order to establish your copyright ownership, the work for hire agreement must also contain an assignment of the entire copyright.
Whether you are a business owner, musician, writer or producer, you spend a lot of time and/or money developing your work. Beware when other individuals contribute to your work, that are not employees or independent contractors whose work fall within one of the nine statutory categories, they may be deemed the copyright or co-copyright owners. Therefore, to avoid any potential copyright lawsuits, a well drafted work for hire agreement must be used to establish legal ownership and control of the work.