Copyrights: Works Made for Hire

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Normally, the person who creates the work is the author and owner of copyright.  But under certain circumstances, someone who employs or supervises the work of another is considered the author and owner of copyright. This principle, known as the work made for hire doctrine, shifts ownership of the copyright from the creator of the work to the employer. Determining whether a work is made for hire is very important. Consider the following scenario: A charitable organization hires a public broadcasting crew to videotape the Mardi Gras in New Orleans.  The video crew later licenses portions of the video for use in a sexy movie. The charity is unable to stop the second use because a court has determined the video crew retained rights of ownership in the videotape and could license it freely.  This result could have been avoided if the persons hiring the crew were familiar with the concepts of works made for hire.

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Two Types of Works Made for Hire

The Copyright Act of 1976 defines a work made for hire as either:

  • a work prepared by an employee within the scope of his or her employment; or
  • a work specially ordered or commissioned for use as a contribution to a collective work, as a part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire.

If the work is created as work made for hire, the hiring party (whether individual or business entity) is the author and should be named the author in the application for registration. The work made for hire status of a work will effect the length of copyright protection and termination rights as discussed below.

 Works Prepared By An Employee Within the Scope of Employment

A work made fore hire can occur in two separate ways. The first method is by an employee with in the scope of employment. Under this first method, the court will examine the relationship between the hired party and the person doing the hiring. If the court determines that the work is created within the scope of an employer employee relationship, the work will be categorized as made for hire.

Scope of Employment.  To qualify under the first method of creating a work made for hire, the work must be created within the scope of employment.  Therefore, if a programmer creates a software program before beginning employment at a computer company, that software program will not be a work made for hire.  Subsequently, an original work created after employment will not be a work made for hire. In addition, the work must be created within the scope of employment. For example, if a woman works as a waitress but writes a song at work, that song is not a work made for hire because it is not within the scope of her employment.

Defining an Employee-Employer Relationship: The CCNV Case. In 1989, in Community for Creative Non Violence v. Reid, the Supreme Court reviewed the standards for interpreting when an author is an employee for purposes of the work for hire doctrine. The Community for Creative Non-Violence ("CCNV") is a non profit organization dedicated to eliminating homelessness in America. In 1985 they decided to create a float for the Washington D.C. Christmas Pageant. One director conceived of the idea of a statue as an analogy to the nativity scene with a homeless family huddled over a steam grate.  They hired a sculptor named Reid. After compromising on the material to be used, Reid prepared a sketch. The CCNV requested some changes. Reid agreed to create the statue and received a $3,000 advance. The CCNV constructed the steam grate portion of the exhibit. On December 24, 1985, 12 days after the due date, Reid delivered the statue and was paid the final $15,000.  After the pageant and a month on display, the CCNV wanted to take the statue to other cities. Reid, who now had possession of the sculpture, objected claiming that the statue was too fragile. Reid wanted to take the statue on a less demanding exhibit tour. Both parties claimed copyright in the work. The Supreme Court held that the sculpture was not a work made for hire because Reid was not an employee, as defined under law. Among the questions considered by the Supreme Court when determining whether Reid was an employee or contractor were:

  • What is the level of skill required in the particular occupation?
  • Does the employer or the worker supply the instrumentalities and tools of the trade?
  • What is the location of the work?
  • What is the length of time for which the worker is employed?
  • Does the hiring party have the right to assign additional work projects to the hired party?
  • What is the extent of the hired party's discretion over when and how long to work?
  • What is the method of payment (i.e., by the job, by the hour, etc.)?
  • What is the hired party's role in hiring and paying assistants?
  • Is the work part of the regular business of the hiring party?
  • Is the hiring party in business?
  • Is there any provision of employee benefits?
  • What is the tax treatment of the hired party?

Employment Agreement Is Not Controlling. Occasionally a hired party will be asked to sign a written agreement that states that the person is an employee and that works resulting from employment are works made for hire. Such an agreement may be a factor in a determination of ownership and it also may be a factor in the second method of creating a work made for hire (i.e., a commissioned work,) but a work made for hire agreement does not prove that a work is made for hire.  When determining if an employment relationship exists, as in the Reid case, the court will examine the factors surrounding the creation of the work to determine if a true employer employee agreement exists. Therefore, when assessing whether a work is made for hire under an employer employee relationship, an employer should not mistakenly assume that a signed agreement confirms ownership of the copyrighted work.

Effect of State Employment Law. Some states, such as California, require that employers who claim copyright ownership through employer employee work for hire relationships, must pay employee benefits, including worker's compensation, unemployment insurance and disability insurance. See Cal. Labor Code § 3351.5 and Cal. Unemployment Ins. Code §§ 621(d) and 686.

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Commissioned Works

The second method that a work may be characterized as made for hire is if (a) the work is specially ordered; (b) there is a written agreement signed by both parties indicating it is a work made for hire; and (c) the work is used in one of a group of specially enumerated works.  In order to meet the standards of a commissioned work, all of the above criteria must be met.

Commissioned Works: Enumerated Categories. In order to qualify as a commissioned work made for hire, the work must be used as:

  • a contribution to a collective work;
  • as a part of a motion picture or other audiovisual work;
  • as a translation;
  • as a supplementary work (i.e., a work prepared for publication as a secondary adjunct to a work by another author for the purpose of introducing, concluding, illustrating, explaining, revising, commenting upon, or assisting in the use of  the other work, such as forewords, afterwords, pictorial illustrations, maps, charts, tables, editorial notes, musical arrangements, answer material for tests, bibliographies, appendixes, and indexes);
  • as a compilation;
  • as an instructional text (i.e., a literary, pictorial, or graphic work prepared for publication and with the purpose of use in systematic instructional activities)
  • as a test or as an answer material for a test; or
  • as an atlas.

If the use of the commissioned work does not fall into one of the enumerated categories, above, it does not matter if the parties have signed a written agreement.  The result will not be a work made for hire. For example, a company commissions a sculptor to create a work to be displayed in the lobby of the building. The sculptor signs a work for hire agreement. The work will be owned by the sculptor, not the company, because the sculpture is not included among the enumerated uses.

Commissioned Works: Signed Agreement. In order to qualify as commissioned work made for hire, a signed agreement is required stating that the commissioned work is made for hire.

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