Employee Invention: Legal Principles and Special Features
Definition of an Employee Invention
Als Employee Invention refers to an invention made by an employee within the scope of their employment relationship and that is directly related to their work for the employer. The legal provisions regarding employee inventions regulate how the rights to such inventions are distributed between employee and employer, and how these claims and procedures are structured to ensure legal certainty.
Statutory Provisions
Employee Inventions Act (ArbnErfG)
The central set of rules for employee inventions in Germany is the Act on Employee Inventions (ArbnErfG). The purpose of this law is to ensure a balance of interests between the employee-inventor’s concerns on the one hand, and the employer’s economic interests on the other.
Types of Inventions
The ArbnErfG distinguishes between different types of inventions, which are decisive for the legal consequences:
- Service Invention (§ 4 para. 2 ArbnErfG): Inventions made during the term of the employment relationship that either arise from the employee’s duty to work or are substantially based on the facilities or work of the company.
- Free Invention (§ 4 para. 3 ArbnErfG): Inventions that have no relation to the employer’s business activities or business resources.
Notification and Claiming Procedures
Notification of the Invention
Pursuant to § 5 ArbnErfG, the employee is obliged to promptly notify the employer in writing of a service invention. The notification must be so detailed that the employer can assess the invention both technically and legally. The employer must report any deficiencies in the notification within two months; if not, the notification is deemed to be in due form.
Claiming by the Employer
Upon receipt of a proper notification, the employer may claim the service invention within four months by means of a written declaration (§ 6 para. 2 ArbnErfG). If such declaration is not made, the service invention automatically becomes a free invention after expiry of the period.
With the claiming, all exploitable rights to the service invention are transferred to the employer. However, the employee retains inventorship (§ 6 para. 1 ArbnErfG) and is entitled to appropriate remuneration (§ 9 ArbnErfG).
Free Inventions
Free inventions must be disclosed to the employer if they could fall within the employer’s field of activity. The employer may under certain conditions have a pre-emption right, but may only claim use within a specified period (§ 18 ArbnErfG).
Employer’s Remuneration Obligation
According to § 9 ArbnErfG, the employer is obliged to pay the employee appropriate inventor’s compensation for a claimed service invention. The amount depends on the scope and economic value of the invention as well as the employee’s contribution to its development.
Calculation of Remuneration
The details for calculation are regulated in the “Guidelines for the Compensation of Employee Inventions in Private Service” issued by the Federal Ministry of Labour and Social Affairs. The basic principles are consideration of the economic benefit and evaluation of the individual inventor’s contribution.
In case of disagreements regarding the appropriateness of the remuneration, the arbitration board at the German Patent and Trademark Office may be called in (§ 29 ArbnErfG).
Obligations of the Contractual Parties
Obligations of the Employee
In addition to the notification obligation, the employee is required to describe the invention in sufficient detail and provide the employer with all information necessary for registration. After registration of the invention, the employee is entitled to be named as the inventor (§ 5 para. 2 ArbnErfG).
Obligations of the Employer
The employer must acknowledge receipt of the notification, register the invention upon request, and protect the rights arising from the invention. If the employer fails to fulfill the obligation to register, the employee may be entitled to an independent right to file (§ 13 ArbnErfG).
Patent and Utilization Law Aspects
Filing and Protection Rights
For claimed service inventions, it is up to the employer to file the invention for a patent, utility model, or other protective rights. The employee remains the named inventor on the protective right, even if the right is held by the employer.
Foreign Filings
When filing patents abroad, the employer must give the employee the opportunity, within certain periods, to file the invention abroad themselves if the employer does not do it themselves (§ 14 ArbnErfG).
Special Features for Certain Employee Groups
Scientific Staff and University Inventions
For employees working at universities, there are partly special rules under the Employee Inventions Act and the respective state law. Since the legislative reform in 2002, the university can generally claim rights to university inventions, whereby a corresponding remuneration obligation exists.
Inventions by Senior Employees
The provisions of the Employee Inventions Act also apply to executives and senior employees, provided they are not members of the governing body and are not independently engaged in entrepreneurial activities. For governing body members, the regulations regarding service inventions do not apply.
Protection of Trade Secrets and Confidentiality Obligations
Inventions in the workplace environment are often subject to the protection of trade secrets. Employees are obliged to treat the technical details of the invention as confidential until the employer publishes these or arranges for patent protection.
Sanctions and Consequences of Breaches of Duty
Breach of Notification Obligation
For breaches of the notification obligation or other duties, the Employee Inventions Act does not provide for criminal sanctions; however, the employer may have a claim for damages if a breach of duty causes harm.
Breach of Registration or Remuneration Obligation
If the employer fails to fulfil their obligations, the employee may assert both claims for damages and their own rights to use or register the invention.
International Regulations and Conflict of Laws
In cross-border employment relationships, the law applicable to the employee invention must be determined according to the general rules of private international law. Many countries have specific provisions for employee inventions that differ from German law.
Summary and Importance of Employee Invention
Employee invention is a central element in promoting technological progress and safeguarding employee interests in the work environment. The Employee Inventions Act creates a fair balance and promotes innovation in industrial and academic spheres. Employers are encouraged to appropriately consider inventors’ interests and to create innovation-friendly structures, while employees are protected by clear legal frameworks and compensation claims.
See also:
Literature and further information can be found on the pages of the German Patent and Trademark Office.
Frequently Asked Questions
When and how must an employee invention be reported to the employer?
Under German law, especially the Employee Inventions Act (ArbnErfG), it is precisely regulated that an employee must report a service invention to the employer immediately in written form. The report must be so detailed that the employer can adequately assess the invention without further questions. This includes a precise description of the problem, the solution approach, the results achieved, and any series of experiments. The notification must be signed personally and must clearly indicate that it is an invention report pursuant to § 5 ArbnErfG. The employer confirms receipt in writing without delay; otherwise, the report is considered received after two weeks. If the employee fails to comply with these rules, they risk losing rights to the invention or even breaching contractual duties, which may have employment law consequences.
What rights does the employer have to a reported employee invention?
Upon receipt of a valid invention report, the employer can decide whether to claim the invention. This must be declared in writing to the employee within four months of proper notification. If the employer claims the invention, all exploitable rights to the invention pass to them; however, the employee is entitled to statutory compensation. The employer is then obliged to file the invention for a patent, utility model, or protective right, as far as this appears economically reasonable. If the claim is not properly or timely declared, the rights remain with the employee, who may freely dispose of the invention, but must grant the employer a prior user right.
What obligations does the employer have after claiming the invention?
After validly claiming a service invention, the employer is obliged to file the invention with the competent patent office for protection, unless there is a justified reason not to do so. This includes careful execution of the registration process, regular communication with the employee about the procedural steps, and bearing all costs incurred during the protection procedure. Furthermore, the employer must regularly inform the employee about the status of registration and subsequent commercialization. If the registration is abandoned or not continued, the employee must be informed so that they can reclaim the rights if necessary.
How is the remuneration for an employee invention calculated and regulated?
According to § 9 ArbnErfG, the employee is entitled to appropriate compensation as soon as the employer has claimed and exploited the invention or enabled its use. The amount depends on the value of the invention, economic usability, the success of exploitation, and the employee’s share in the solution. The “Guidelines for the Compensation of Employee Inventions in Private Service” are regularly used for calculation. These take into account factors such as the area of responsibility, technical significance, feasibility, and usual industry compensation rates. An individual agreement on compensation arrangements is often possible, but may not deviate from the law to the employee’s disadvantage.
What deadlines must be observed in connection with employee inventions?
Numerous, sometimes very strict, deadlines apply to employee inventions. The most important deadline is the notification of the invention, which must be made “immediately”, i.e. without culpable delay, after completion of the invention. Following proper notification, the employer has four months to claim the invention. If the claim is not made within this period, the invention is automatically released. There are also certain deadlines for patent or utility model filings, which depend on whether the claim has been made. In addition, deadlines for payment of the compensation and for notification of key steps, such as abandonment of the protection application, must be observed to avoid loss of rights.
What happens in the case of a joint invention by several employees?
In the case of joint inventorship, i.e., if several employees make a service invention together, all participants must sign and jointly submit the invention report. The employer can then claim the invention in total or in part. The compensation is distributed among the co-inventors according to their respective contributions to the inventive achievement. Problems often arise in determining and evaluating the individual contributions, which is why clear, joint documentation is recommended when filing. The employer is obliged to conclude individual or collective agreements on compensation with all involved inventors.
What special features apply to inventions made by employees abroad?
Inventions made by an employee abroad are generally subject to the respective national law at the place of work. However, the German Employee Inventions Act provides that it also applies to foreign inventions if the employment relationship is governed by German law and the employee is regularly seconded to Germany. In cases of cross-border employment, the rules of private international law often need to be reviewed to avoid double filings, loss of rights, or compensation claims abroad. In such cases, the employer should specifically inform the employee about special features and seek legal advice if in doubt.
