1. Why “Work Made for Hire” is a Term Made for Confusion
© 2007 Dana H. Shultz – Readers may reproduce and distribute copies of this article in its entirety.
As Alexander Pope wrote in An Essay on Criticism (1711), "A little learning is a dangerous thing...." That
certainly pertains to the legal concept of a "work made for hire" (WMFH).
People who have some knowledge of WMFH typically believe that it means the transfer of all rights in a
work from the creator to a purchaser. So, for example, if an independent contractor writes software for a
company, then according to this belief, the company will own all rights to the software if the parties'
contract says the software is a WMFH.
This belief is wrong. The following is an explanation of what WMFH really means under copyright law
and how parties actually can arrange for transfer of all rights in a work.
Meaning of WMFH
Title 17, Section 102(a) of the United States Code states that "Copyright protection subsists...in original
works of authorship fixed in any tangible medium of expression...." Copyrightable works include, among
others, literary, musical, dramatic and audiovisual works.
Subject to certain limitations, the owner of a copyright has a set of exclusive rights, such as the rights to
make and distribute copies and to prepare derivative works (17 U.S.C. Section 106). If someone infringes
any of the exclusive rights, the copyright owner may seek remedies that include injunctions (17 U.S.C.
Section 502), recovery of actual damages and additional profits of the infringer or, alternatively, statutory
damages (17 U.S.C. Section 504), and recovery of litigation costs and attorney's fees (17 U.S.C. Section
505).
These rights and remedies are quite powerful. Accordingly, anyone who pays for a work has a strong
incentive to own the copyright.
According to 17 U.S.C. Section 201(a), "[c]opyright of a work...vests initially in the author...." Section
201(b) provides, however, that "[i]n the case of a work made for hire, the employer or other person for
whom the work was prepared is considered the author...."
"Work made of hire" means, most commonly, "a work prepared by an employee within the scope of his
or her employment" (17 U.S.C. Section 101). There is, however, a second class of specifically
enumerated types of works (such as translations, instructional texts, and works specially commissioned as
contributions to collective works) that also qualify as WMFH if a signed contract so states.
Ownership of Rights to Works
Taking all of these provisions together, we see the following with respect to WMFH:
· An employer automatically owns the copyright to a work prepared by an employee within the
scope of his or her employment.
· A company that hires an independent contractor to prepare a work will own the copyright to that
work only if (a) there is a signed agreement that says the work is a WMFH and (b) the work falls
into one of the enumerated types.

2. For any business that wants to own all rights in a work, there are two significant limitations in relying on
WMFH status:
· For most works prepared by independent contractors, WMFH treatment is not available because
the work is not of one of the enumerated types.
· Even if the work is a WMFH, that status has no bearing on rights other than copyright, such as
those pertaining to patents.
Consequently, prudent businesses often include in agreements with employees and independent
contractors both WMFH language and a provision that explicitly assigns all rights to the work. An
example:
Company will have all right, title and interest in and to the Work Product. Company will be the
sole and exclusive owner of the Work Product as a "work made for hire" under applicable
copyright laws. If any Work Product is not deemed a "work made for hire", Supplier hereby
assigns to Company all of Supplier's right, title and interest in the Work Product. Supplier hereby
waives any moral rights that it may have in the Work Product.
The bottom line: One can pay for a work yet not own it. It is far better to ensure ownership with a
properly drafted agreement.
Dana Shultz (www.danashultz.com) provides high­touch legal services to high­tech companies. He can be
reached at 510­547­0545 or dana@danashultz.com.
The information in this article is not intended as legal advice. If you need legal advice on a matter, please
contact an attorney directly.