Work for hire occurs when a business contracts an individual to create something valuable, and they give up the right to own the creation. Essentially, the work created belongs to the business, not the person who created it.
The concept of work for hire (WFH) is used in industries where the employer wants to hire a freelancer or independent contractor to produce a specific work product. These industries include:
- Design
- Writing
- Software development
- Photography Service
In work made for hire arrangements, the business owner desires to use the work product to enhance their business and wants to ensure they have exclusive rights.
In the next section, we will go into depth in defining work for hire, how it works, its advantages, laws that govern it, and provide specific examples.
What Is Work for Hire?
Work for hire, also known as work made for hire, was created by the United States Copyright law. It is an exception to an original rule stipulating that the person who creates a particular work is considered the legal author.
But under the WFH law, the person who gave you the work, not you, is regarded as the author and has copyright ownership of the work. Companies often require the independent contractor or its employees to sign a written agreement giving up their rights to the work.
Companies are now turning to independent contractors to fill the growing gap. To maintain ownership over the creations, they require freelancers to enter into a work made for hire agreement.
How Does Work Made for Hire Work?
Before hiring a freelancer, it is important to understand how work made for hire operates. This is essential because creative work often results in copyright issues, so you can make sure you protect yourself from unwanted legal disputes.
- Agreement: Once you decide to work with an independent contractor, enter into an agreement that extensively spells out the terms and conditions of the working relationship.
- Ownership: In the WFH agreement, the contractor is not entitled to the copyrights of the work. The employer is regarded as the rightful legal owner.
- Compensation: You must compensate the contractor for handing over the rights and use of the work created. The fee or salary is often specified in the agreement.
- Use of the creation: After compensation, you have the right to use the work how you see fit. You can use it for marketing, advertising, or meeting other business goals.
- Termination: After completion of the work, you continue to own the rights to the work. The independent contractor should understand that they have no further rights to it.
When implemented correctly, work made for hire helps companies to work legally with freelancers. It helps companies ensure they have the right to use collective work to achieve their business purposes.
Advantages of Work for Hire
Companies entering a work made for hire agreement understand the benefits of working with independent contractors. The following are the advantages that drive more businesses to work with them.
- Cost-effective: You avoid paying license fees and royalties to use the work long-term.
- Maintain Control: You receive the right to use the work any way you want, including reproducing, distribution, and selling.
- Predictable: The WFH agreement specifies the terms and conditions, providing a clear understanding of the role of each party.
- Full ownership: You become the legal owner of the collective work and have exclusive rights to use it as you wish.
- Simplicity: The WFH agreements are often straightforward for both parties to understand.
The Copyright Law for Work for Hire
The United States copyright law exhaustively tackles the copyright matter when an employer and a contractor enter into a working relationship.
It begins by defining WFH in section 101 as work prepared by an employee as per their employment terms or a particular work commissioned or ordered to contribute to a company's collective work.
Further, section 201 of the copyright law explains the owner's rights after signing an agreement. The law allows them to use, duplicate, distribute, or display the work as they see fit.
In some unique work situations, section 203 permits the parties to agree to terminate copyright rights after an agreed period. Meaning the original owner can reclaim ownership after the agreed time in the contract expires.
Lastly, section 204 outlines the requirements for transferring ownership of all copyrighted work, including WFH. Ideally, the transfer should be done in writing and signed. It also specifies the transfer terms and conditions.
Work Made for Hire Examples
Not all independent contractual work is considered work for hire. As mentioned above, the Copyright Act's definition gives specific criteria for a work to be considered WFH. The following are examples of work that meet this criterion:
- Employee work: Any work an employee creates for your company is considered work for hire. For example, you are the exclusive owner of the photos a photographer working for your company takes.
- Commissioned work: Independent contractors such as designers, writers, and software developers who agree in writing to hand over the rights to work they create are considered work made for hire.
- Instructional texts: People who write instructional material for developing textbooks or online learning material are considered engaging in work made for hire—if they agree to relinquish their rights in writing.
- Supplemental work: Occurs when you hire a freelancer to add input to an already existing work. For example, the freelancer can add charts, tables, pictures, and bibliographies to another author's work.
In recent times, work for hire is an area that companies cannot afford to overlook in their business plans. Hiring an independent contractor offers immense benefits that allow you to surpass your goals.
Start your Independent Contractor Agreement Template now
Helpful Resources:
Freelancers Union - Freelancing in America
17 USC 204: Execution of transfers of copyright ownership - US Code.
Work for hire occurs when a business contracts an individual to create something valuable, and they give up the right to own the creation. Essentially, the work created belongs to the business, not the person who created it.
The concept of work for hire (WFH) is used in industries where the employer wants to hire a freelancer or independent contractor to produce a specific work product. These industries include:
- Design
- Writing
- Software development
- Photography Service
In work made for hire arrangements, the business owner desires to use the work product to enhance their business and wants to ensure they have exclusive rights.
In the next section, we will go into depth in defining work for hire, how it works, its advantages, laws that govern it, and provide specific examples.
What Is Work for Hire?
Work for hire, also known as work made for hire, was created by the United States Copyright law. It is an exception to an original rule stipulating that the person who creates a particular work is considered the legal author.
But under the WFH law, the person who gave you the work, not you, is regarded as the author and has copyright ownership of the work. Companies often require the independent contractor or its employees to sign a written agreement giving up their rights to the work.
Companies are now turning to independent contractors to fill the growing gap. To maintain ownership over the creations, they require freelancers to enter into a work made for hire agreement.
How Does Work Made for Hire Work?
Before hiring a freelancer, it is important to understand how work made for hire operates. This is essential because creative work often results in copyright issues, so you can make sure you protect yourself from unwanted legal disputes.
- Agreement: Once you decide to work with an independent contractor, enter into an agreement that extensively spells out the terms and conditions of the working relationship.
- Ownership: In the WFH agreement, the contractor is not entitled to the copyrights of the work. The employer is regarded as the rightful legal owner.
- Compensation: You must compensate the contractor for handing over the rights and use of the work created. The fee or salary is often specified in the agreement.
- Use of the creation: After compensation, you have the right to use the work how you see fit. You can use it for marketing, advertising, or meeting other business goals.
- Termination: After completion of the work, you continue to own the rights to the work. The independent contractor should understand that they have no further rights to it.
When implemented correctly, work made for hire helps companies to work legally with freelancers. It helps companies ensure they have the right to use collective work to achieve their business purposes.
Advantages of Work for Hire
Companies entering a work made for hire agreement understand the benefits of working with independent contractors. The following are the advantages that drive more businesses to work with them.
- Cost-effective: You avoid paying license fees and royalties to use the work long-term.
- Maintain Control: You receive the right to use the work any way you want, including reproducing, distribution, and selling.
- Predictable: The WFH agreement specifies the terms and conditions, providing a clear understanding of the role of each party.
- Full ownership: You become the legal owner of the collective work and have exclusive rights to use it as you wish.
- Simplicity: The WFH agreements are often straightforward for both parties to understand.
The Copyright Law for Work for Hire
The United States copyright law exhaustively tackles the copyright matter when an employer and a contractor enter into a working relationship.
It begins by defining WFH in section 101 as work prepared by an employee as per their employment terms or a particular work commissioned or ordered to contribute to a company's collective work.
Further, section 201 of the copyright law explains the owner's rights after signing an agreement. The law allows them to use, duplicate, distribute, or display the work as they see fit.
In some unique work situations, section 203 permits the parties to agree to terminate copyright rights after an agreed period. Meaning the original owner can reclaim ownership after the agreed time in the contract expires.
Lastly, section 204 outlines the requirements for transferring ownership of all copyrighted work, including WFH. Ideally, the transfer should be done in writing and signed. It also specifies the transfer terms and conditions.
Work Made for Hire Examples
Not all independent contractual work is considered work for hire. As mentioned above, the Copyright Act's definition gives specific criteria for a work to be considered WFH. The following are examples of work that meet this criterion:
- Employee work: Any work an employee creates for your company is considered work for hire. For example, you are the exclusive owner of the photos a photographer working for your company takes.
- Commissioned work: Independent contractors such as designers, writers, and software developers who agree in writing to hand over the rights to work they create are considered work made for hire.
- Instructional texts: People who write instructional material for developing textbooks or online learning material are considered engaging in work made for hire—if they agree to relinquish their rights in writing.
- Supplemental work: Occurs when you hire a freelancer to add input to an already existing work. For example, the freelancer can add charts, tables, pictures, and bibliographies to another author's work.
In recent times, work for hire is an area that companies cannot afford to overlook in their business plans. Hiring an independent contractor offers immense benefits that allow you to surpass your goals.
Start your Independent Contractor Agreement Template now
Helpful Resources:
Freelancers Union - Freelancing in America
17 USC 204: Execution of transfers of copyright ownership - US Code.
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