Copyright Ownership when Using Independent Contractors and Service Providers

Businesses often utilize a third-party for services, especially when directly employing someone to perform the task will not add value to the organization. By way of example, it is common practice for a business to hire a freelance photographer, a marketing company to write advertising copy, or an independent contractor to write specific policies and procedures. For many, the business needs require the decision maker move fast and little consideration is given the intellectual property rights. Unfortunately, this can lead to a number of challenges for both the business and the independent contractor.

Generally, when a business hires an independent contractor, the ownership of the creative work belongs to the hiring business. That means the independent contractor is unable to use the work that they actually created without the permission of the business. By way of example, a freelance photographer is infringing on the businesses copyright ownership when posting the photo they took on behalf of the business to their personal portfolio website. Conversely, if the agreement between the business and the independent contractor provides that the independent contractor will have ownership rights, the business may be limited in how they can use the work that they specifically hired the independent contractor to complete. Even more complicated is when no written agreement exists at all or if the business is operating in certain states that have rules that alter the ownership analysis.

To avoid intellectual property disputes that arise from hiring independent contractors, a business should ensure that they have an agreement in place with each independent contractor. The agreement should address ownership and, in many of the more complex business relationships, ensure that the licensing adequately protects the interests of both parties.

VW Contributor: Alex Rainville
© 2019 Vandenack Weaver LLC
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What Is the Difference Between an Employee and an Independent Contractor?

A Business FAQ with Mark A. Williams.

An employee is somebody that you pay wages to, you withhold taxes from them, and you provide them benefits. An independent contractor is one where you pay them a set amount of money and they have to withhold their own wages.

In a business, it is important to be able to recognize when can I pay someone as an employee versus when can I pay them as an independent contractor. There are a lot of different tests depending on certain questions:

  • Do I have to provide workers comp?
  • Do I have to pay unemployment?
  • Do I have to withhold taxes from them?

Generally, I say to people that if you control what they do and tell them you have to be in my office and use my computer, you have to be here at 8 o’clock, you have to leave at noon, that sounds like an employee. And generally if you say to them, “Go get this done sometime over the next couple of weeks,” that sounds like an independent contractor. But really, you have to look at the facts and circumstances to make that determination every time.

© 2014 Parsonage Vandenack Williams LLC

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