for hire

Work for Hire

Work for hire is a very slippery slope for any employer to take. The current best practice is to have the employees register their works themselves (at company expense) and pre-negotiate by contract the permission terms for the employer's eventual use of the product (ie for motion picture soundtrack). In the old days, (pre-1978) publication was everything, so when the employer published a form of the composition, that essentially settled the rights issues. But now, copyright protection includes unpublished pre-1978 works as well, meaning the original composer could recover some or all of the copyright value that the employer thought was secured.

Examples from Disneyland.

Disney hires Leopold Stokowski to prepare music composition for the soundtrack of Fantasia. Disney gets a copyright for the motion picture. Meanwhile Stokowsky has his manuscript published (called cue sheets in the trade) and a gets a copyright for the music! Reason is that since Disney was not in the "business" of publishing music scores for symphony orchestras, that application was outside the scope of the employment contract. When Disney wanted to remake Fantasia in the 60's it found that it did not "own" those musical compositions, and Uncle Walt being a notoriously stingy person could not bring himself to paying Stokowski yet again for the same music. A similar example occured for the use of the voice of Snow White in movie Snow White. While performance copyright is a California State law issue, the concepts are comparable to Federal work-for-hire. Disney paid, by contract, for the exploitive use of those voice recordings for the movie soundtrack. That original contract did not provide for unforseen uses, such as repackaging for internet, kids video or TV cartoons, music CDs, et cetera. The authoress complained to the court that since the contract did not specify payment for such uses, that unpaid use was infringement. Another action from the mid-50s was Lady and the Tramp, which had some of its music composed by sultry jazz singer Peggy Lee. While compensated for the movie theatrical run sync rights, additional use of that same music in video distribution requires transmission rights, which Disney was later forced to pay.

Disney was often on the losing end of copyright disputes which is why Uncle Walt refused Premier Nikita Kruchev admittence to Disneyland (circa 1958). The former USSR Communists did not recognize US copyrights and they had freely shown pirated copies of Disney's feature motion pictures without payments. No amount of diplomacy could persuade Disney to be a gracious host to the visiting Prince of Thieves, let alone close the park for a day to throngs of cash paying E-ticket buyers. However Walt was savvy enough to know that contracts trump copyright laws, when he stole the rights to Pancho Lopez from Lalo Guerrero in 1955. Lalo surrendered his performance and recording rights which is why that song has never been re-issued.

Problems with Work-for-Hire

Work for hire is contractual. Because both scope of employment and transfer of rights are critical parameters, a written agreement is absolutely essential. Under current law, courts will always side rights issues with the original author unless the employer can produce compelling evidence to the contrary. But registration or a contract, by itself, does not always provide this protection, vis~

1. The employer did not make payment. Payment is essential to transfer of rights, as this is essentially a commercial agreement. Suppose that the employee complained that his employer shorted his vacation pay, didn't reimburse his necessary travel expenses or fired him without severence. Any failure to pay an employee his due for any purpose will jeapordize the recognition that rights were legally transfered. As the original author, rights CAN be reclaimed if an employer fails to perform as contracted.

2. The scope of employment falls outside the reasonable business purpose of the employer and/or the job description of the worker. A motion picture studio can contract for motion picture soundtracks. A record company for music CDs. A publisher for poetry books.... Including reasonable incidental promotional use supporting the primary business objective. For example soundtrack music could also be used in a television commercial advertising the motion picture. A worker for an appliance assembly plant simply can't be asked to sign over any copyrights of authorship even if its a song about working on the assembly line (but he might be required to assign any patentable ideas concerning making better appliances while employed).

3. The contract is fraudulant. Suppose a greeting card company hires a person to write verses for cards for a fixed fee. Sounds ok. But what if that company failed to disclose that it has a "deal" with a Nashville music publisher to provide lyrics for songs. The card company pulled a "switch and bait" by paying a fair price for a greeting card then intentionally repurposing the work for a use that would have paid a continuing royalty. That is fraud and will bust the contract. In absense of a contract, rights belong to the author, who can then sue both the card and the music publishers for infringement even though they hold the registration.

4. The contract is unfair. Suppose a composer writes a movie soundtrack for a fixed fee. Its a blockbuster movie, and at least the author gets credit and peer recognition for good work, if no extra money. Then the movie producer sells the concept and music to Nitendo for a digital children's game. This killer application was not forseen by either the author or the studio. It is patently unfair that only the employer shall reap profits from future unforseen applications. A contract that is unfair (one-sided) and does not represent a negotiated knowledgeable agreement between parties is invalid with respect to that application. Thus the studio, even though it holds the registration of copyright would find it necessary to re-negotiate the work-for-hire contract to include a profitable new use.

5. The employer fails to protect the interests of the original author. Not all the rights of ownership are transferred as a result of work-for-hire contract, but rather a trustee or guardianship relationship is established. Specifically (unless agreed otherwise) the employer may not allow the work to fall into the public domain. This would ruin the original author(s) future claim to financial gain should the work-for-hire contract ever prove invalid or otherwise terminated. Imagine a spiteful employer doing this to an employee that was sueing for back wages. In this case the court could hold the employer liable for the future profit from the work had it not been lost, even though the employer is not receiving compensation either.

6. Uncertainty of authorship. If the employer fails to keep precise records concerning all parties contributing to authorship of each registration and opts to simply register them as "anonymous corporate" works done by "employees with blanket for-hire contracts", might as well not have had agreements at all. Every contributor is fully entitled to the fruits of copyright. Have a hit movie or song and watch them come out of the woodwork. Past members of music bands, former employees, mothers of former employees, last months visitors to your office, the custodian that has a habit of whistling .... How much better it would have been to let the employee's register their own works and eliminating frivilous lawsuits requiring your proof of original creation.

When it comes to creativity, employees will figure out a hundred angles that defeat a work-for-hire contract. After all, that's their business, creativity that is.