Your Invention Assignment Clause Is Killing Your Company

With unemployment at near apocalyptic levels tech companies still have troubles hiring programmers. In Silicon Valley the war for talent is intense. Word on the street is that Zynga is acquiring companies not for strategic value, but because they don’t want competitors to have the engineers.

Salaries in the deep six figures, fat signing bonuses, and generous referral fees for those who have leads on a high a value target are put out there as incentives for skilled people to join the crew. Stakes are high.

Part of the reason for this is that the talented, passionate, and driven simply don’t need a job. There are lots of ways to make lifestyle money in the tens of thousands a month publishing apps. Or you can raise $100k in seed capital for your nascent startup during a short cab ride. Why get a job?

One of the new gimmicks is companies claiming they have an entrepreneurial environment in an attempt to bring reluctant candidates in from the cold. There’s one way to know this isn’t true, the “Invention Assignment” clause in most employment contracts.

I’ve seen all kinds. Some are quite lenient and agreeable. Most want to own the contents of your brain from the day you start working until you leave. Even then, they may claim ownership of the few lingering pulses coursing through your neurons fired off during the final minutes of your employment. (Luckily, in some states these aren’t enforceable).

If companies want to hire creative entrepreneurs they have to offer upside–risk, even. Let people take ownership of their ideas and responsibility for their success (or failure). The fact is the smartest and most creative employees won’t offer up a single decent idea if they know it’s company property whether or not it’s used.

This requires forming an organization to incubate ideas instead of just bringing on new talent to your existing corporate morass. Create a place where talented individuals can thrive, instead of slowly morphing from a motivated entrepreneur to a veal in a pen fattened up on 3 hour meetings and regular paychecks.

5 thoughts on “Your Invention Assignment Clause Is Killing Your Company

  1. Interesting point, let’s say you leave a company with a “hardcore” invention assignment clause, then create a startup and totally rip-off some investors. Could legal action be diverted to that company you left- effectively using the invention assignment clause against that company?

    Its a silly hypothetical, I know (the damage to your reputation, a currency more important than money, would be career-ending), but is it a viable edge case?

    • Hmm, I doubt it. But I’m not a lawyer. Always have a lawyer check out these clauses–it’s not that expensive and it might save you a lot of pain in the long run. There’s no such thing as a ‘standard’ contract, they can always be changed.

  2. Pingback: Your Invention Assignment Clause Is Killing Your Company « Ralph … | Twitter For Afghans

  3. Pingback: 3 Ways Your Employer is a Tyrannical Dictatorship « Ralph Barbagallo's Self Indulgent Blog

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