IP & Invention Assignment Clauses in Employment
An invention-assignment clause can hand the company everything you create — including side projects — unless a state-required carve-out protects your own-time inventions.
Last reviewed: May 26, 2026 by the BizLeaseCheck Editorial Team
General information, not legal advice.
Overview
Invention-assignment and work-for-hire clauses transfer ownership of what you create to your employer. A clause limited to work done for the company is normal; one that sweeps in everything you invent, including personal projects, is overbroad.
Several states require a carve-out for inventions an employee develops entirely on their own time without company resources, which is the key protection to look for.
Topics to check
A typical clause assigns to the employer inventions, works, and IP you create within the scope of your employment, plus a "work made for hire" designation for copyrightable work. Watch for clauses that assign everything you conceive during employment "whether or not during working hours" and "whether or not using company resources," which can reach your unrelated side projects.
Also look for "trailing" assignment provisions that try to capture inventions for a period after you leave — these are often limited or unenforceable, but worth flagging.
Several states require that an invention-assignment clause not reach inventions the employee developed entirely on their own time, without using the employer’s equipment, supplies, facilities, or trade secrets, unless the invention relates to the employer’s business or results from work performed for the employer. California, for example, makes such an over-assignment unenforceable and requires employers to give written notice of the carve-out.
If you are in a state with this protection, confirm the agreement includes the required carve-out and notice — its absence is a drafting red flag.
California Labor Code § 2870 (CA Legislative Information)List any prior inventions you want to exclude (many agreements have a schedule for this), and add or confirm the own-time carve-out if your state provides one. If you do meaningful outside creative or open-source work, make sure the clause does not silently claim it.
Getting this right at signing avoids a later dispute over who owns something you built on the side.
Key takeaways
- Invention-assignment and work-for-hire clauses transfer your work product to the employer.
- A clause reaching everything you invent, even on personal time, is overbroad.
- Several states require a carve-out for inventions made on your own time without company resources.
- California makes over-broad assignment unenforceable and requires written notice of the carve-out.
- List prior inventions to exclude and confirm the own-time carve-out before signing.
Official resources
Legal-review notes
Guide confidence marker: Medium confidence.
- Whether a state requires an own-time invention carve-out, and its exact scope, varies by state; confirm with counsel.
- Work-for-hire and assignment enforceability depend on the wording and applicable state and federal IP law.
Frequently asked questions
Does my employer own everything I create?
Generally the company owns inventions and work you create within the scope of your job, and copyrightable work can be "work made for hire." But several states require a carve-out for inventions you develop entirely on your own time without company resources that do not relate to the employer’s business.
Can an invention-assignment clause claim my side projects?
An overbroad clause may try to, especially one assigning everything you conceive "whether or not using company resources." In states with a statutory carve-out (like California), assignment cannot reach genuine own-time, own-resource inventions unrelated to the employer’s business.
How do I protect prior or personal work?
List prior inventions you want excluded on the agreement’s schedule, confirm the state-required own-time carve-out is present, and make sure outside creative or open-source work is not swept in. Resolve this before signing to avoid a later ownership dispute.