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The determination of copyright ownership is one of the toughest questions in copyright law. The basic rule is that all copyright interests in a work belong to the work’s creator. When two or more people collaborate to create a work, however, copyright ownership becomes more complicated. Furthermore, when the author of a work is compensated by a third party to make the work, determining copyright ownership is more challenging.

Joint Authorship

Under the Copyright Act, a joint work can be made when numerous persons collaborate to create a single work. The Copyright Act defines a joint work as:

Both authors must intend for their contributions to be integrated under this definition, and this purpose must exist at the time the contribution is generated. It is not required for the contributions to be of equal effort or worth. It’s also not required for the co-authors to operate in the same physical space or at the same time. The sole criterion, according to the legislation, is that both writers intend for their works to be “merged into inseparable or interdependent parts of a unitary whole.”

A song written by a composer and lyricist is an example of a collaborative effort. The song is deemed a collaborative work if both parties desire for their contributions to be integrated into a single song. There would be no collaborative work if the lyricist wrote the words with the intention of using them only as a poem, and the composer afterward produced music for the poetry. This is true even if the composer planned to create a single piece since the lyricist had no such aim.

The ability to determine if a joint work is made is vital in assessing each party’s rights to the work created. If there is a joint work, both authors have an undivided stake in the entire work. Without asking permission from the other co-author, one of the writers is free to utilize the entire work as they see fit (s). If a single author makes a profit from the joint work’s exploitation, however, the earnings must be shared with the other joint author.

If there is no “joint work,” the combined efforts of many writers are temporarily brought together as distinct works. The writers can nonetheless agree to merge their works into a single song in the case of the lyricist and composer who developed their works without intending for them to be joined. Neither party, however, is allowed to utilize the work of the other without their consent. Except for what they agree upon with the other author, neither author would have any rights to the entire song.

Works Made for Hire

In a work made for hire situation, the work’s “author” is no longer the person who created it. Instead, the “author” is regarded as the business that employed the work’s real creators (such as a corporation for whom the author works as an employee).

The Copyright Act restricts the use of the work-for-hire concept to two scenarios:

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,

but even then only if the parties agree in writing that the work is work made for hire.

Only when the work’s creator is an employee, not an independent contractor, does the first circumstance apply? The “common law of agency” is used to assess whether an individual is an employee for the purposes of the work produced for hire concept. This implies that courts will consider a variety of elements to establish whether a person is an employee, including:

the control exerted by the employer over the employee (i.e., the employee’s schedule and the hiring of the employee’s assistants);
the control exerted by the employer over how and where the work is done;
the supplying of equipment for the employee’s use; and
the payment of benefits and the withholding of taxes.

Although these factors are not exhaustive and can be difficult to analyze in close situations, it is clear that a work created within the scope of a regular, salaried employee’s work is work made for hire. Typical examples of works made for hire would include a software program created by an employee programmer, or the ad copy created by a marketing department employee.

The work may still be work for hire if it is created by an independent contractor (that is, someone who is not an employee), but the definition is far more difficult to meet. The following facts must be present in order for an independent contractor’s work to be considered a work for hire:

the work must be specially ordered or commissioned;
the work must come within one of the nine categories of works listed in the definition above; and
there must be a written agreement between the parties specifying that the work is work made for hire.

The ability of the hiring party to use the generated work depends on the assessment of whether a given work is work made for hire. When a work has been deemed a work created for hire, the hiring party is the author and owner of the piece. The hiring party does not have copyright ownership in the work if it is not work done for hire. The hiring party’s capacity to use the work would thus be determined by the terms of its agreement with the author, or by the idea of an implicit license to use the work (for more detail on this issue, see the BitLaw discussion on implied licensing). If the employing party is obliged to rely on an implied license, it may discover that it only has limited rights to change, update, or convert the work for which it paid.

Furthermore, whether or not a work is a work done for hire has an impact on a work’s creator’s capacity to exercise her right to terminate the transfer of rights, which would otherwise influence a license or assignment.

When recruiting computer programmers, for example, software developers should pay particular attention to copyright ownership concerns. Under the first component of the work created for hire definition, programs written by paid personnel will nearly always be deemed works made for hire. As a result, the software developer will be regarded the creator of the program developed by those employees, and ownership will be transferred to him. The wise developer, on the other hand, will have staff sign agreements agreeing to convey all copyrights in software they build to the developer. The reason for this caution is that determining who is an employee under the law of agency necessitates the consideration of several circumstances and, in rare situations, might result in unexpected outcomes. Furthermore, the work must be done “within the scope of” the employee’s employment, according to the work made for hire theory. Programs produced by a software programmer employee are generally considered to be within the scope of his or her employment, although this is another vague statement that should not be relied upon.

In addition, while hiring contract programmers, software developers must tread very carefully. There are three facts must be present in order for contract programmers’ work to be considered work for hire:

the program must be specially ordered or commissioned;
the contract retaining the programmer must be in writing and must explicitly say that the programs created under the agreement are to be considered work made for hire; and
the program created must fall into one of the nine enumerated categories of work.

When a programmer is engaged to work on a certain project, the first element is usually true. The second need may be addressed by carefully establishing a retainer agreement for a contract programmer. The third ingredient, on the other hand, might be more challenging. Computer software applications do not fall into any of the nine categories. The best option is to classify the software application as an “audiovisual work.” While certain software programs are clearly audiovisual works, it’s unclear if courts will extend this definition to all computer software programs. As a result, a software developer has no way of knowing if the contract programmer is producing work for hire.

It is preferable to develop an agreement that takes this uncertainty into account. The agreement should clearly declare that the work is for hire. The contract should additionally say that if the software is not regarded as work for hire, the contract programmer agrees to assign the software’s copyright to the software developer.

Finally, it is critical to ensure that copyright ownership goes from the individual programmer to the software developer when engaging a firm to provide contract programming services. As a result, the software developer should analyze not just its contract with the service provider, but also the contracts under which that firm recruits individual programmers.

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