Does My Employer Own My Idea? Employee Invention Rights Explained

You’ve created an idea or invention, but you have a bit of an issue because “My boss says the idea belongs to the company,” and now you’re wondering if that’s really true. Here is a simple guide and explanation of employee invention rights, as well as what employee inventors need to know before they speak up.

Maybe it’s a new app feature, a clever shortcut that saves hours, a product improvement, or a side-project prototype you built on weekends. You mention it at work, perhaps to get buy-in, or just because you’re proud! But suddenly the air changes:

“That belongs to the company.”

Is that true? Sometimes yes. Sometimes no. Often… it depends on the paperwork and the details you didn’t realize mattered.

Let’s break this down the way I’d explain it to a client sitting across my desk: plain English, real-world examples, and practical steps you can take before you accidentally sign away something valuable.

The uncomfortable truth is that the contract usually drives the answer

In a lot of employee–inventor disputes, the “winner” isn’t the person with the best idea. It’s the person with the best documents.

Many employees sign one or more of these, sometimes buried in onboarding:

Employment agreement (offer letter + attached terms)
Invention assignment agreement
Confidentiality/non-disclosure agreement (NDA)
Employee handbook policies
Equity or bonus agreements (sometimes with IP language)

If you signed an invention assignment agreement, it may say that inventions you create during employment “relate to” the company’s business or “result from” your work are automatically assigned to the company.

A key point to note is that your boss may be quoting the policy, but the policy might not say what they think it says, or it might be broader than it should be. It also might not apply to your particular invention; the actual wording of the agreement matters a lot when it comes down to the specifics.

“I thought it automatically belonged to the company.” Not always.
Here’s a simple way to think about ownership:
Patents (inventions): In many situations, the inventor starts as the owner unless there’s a valid contract transferring rights to someone else.
Copyright, which is creative work like writing, graphics, code, in many contexts: If the work was created by an employee within the scope of their job can be treated as the employer’s work in many situations (people often call this “work made for hire”).
Trade secrets / confidential business info: Even if you created something, you may not be allowed to use the company’s confidential information to build or commercialize it.

So yes, sometimes the company owns it. But it’s not a magic spell. It’s usually one of these factors that decides the issue. On some occasions, it can be a mix of those factors.

The “big four” factors companies use to claim your invention
When an employer says, “that’s ours,” they typically lean on some combination of:

1) You signed an assignment agreement (contract)

If your paperwork says inventions “conceived or developed” during employment belong to the company, the company will argue your idea falls under that umbrella.

Watch for broad language like:

“Relating in any way to the business.”
“Anticipated research or development.”
“any invention during employment.”
“Using any company resources.”

Broad doesn’t always mean enforceable in every situation, but broad language is exactly what employers use to assert ownership.

2) You built it as part of your job

If you were hired to solve a certain problem, and your invention solves that exact problem, the company has a strong argument that it’s within the scope of employment.

A quick test I use with clients:
If your manager had assigned you a project titled “Build this,” would your invention look like the deliverable?

A) You used company time, tools, or resources
Company laptop. Company software licenses. Company datasets. Company lab. Even the company Slack messages are brainstorming the concept.

This isn’t always the end of the story, but it’s a frequent tipping point in disputes because it creates a paper trail the company can point to.

B) Your idea is tied to the company’s confidential information
Even if you built it off-hours, using the company’s proprietary process, client lists, source code, or internal roadmap can convert a “side project” into a legal headache fast.

C) “I made it at home on weekends.” That helps, but it’s not a shield by itself.
People assume off-hours automatically means personal ownership. It’s a strong fact in your favor, but it isn’t the whole picture.

If your contract says “anything you invent while employed” belongs to the company, the company may still try to claim it. The real question becomes whether that clause is valid and how it applies to what you actually built.

Think of it like planting a tree:
If you planted it in your own yard (your own time, your own equipment, your own materials), you’re starting in a better position. But if the seed came from the company’s greenhouse (confidential information) and you used the company’s irrigation system (resources), the company will argue it’s not purely yours.

3) Watch out for “present assignment” language (this is a big one)

Some agreements don’t say “you will assign” inventions. They say, “You hereby assign.”

That sounds like legal filler, but it can be a game-changer. “Will assign” can require a future step. “Hereby assign” is often written to transfer rights immediately when the invention exists.

If you’re trying to license, sell, or raise funding on your idea, investors and partners may demand proof that you (actually) own it. A present-assignment clause can create serious problems if you didn’t realize you’d already signed rights away.

Practical steps you can take right now, before it gets messy
If you’re in the middle of this situation, here’s a clean, careful approach:

Gather your documents. Offer letter, employment agreement, invention assignment, NDA, handbook acknowledgments, and equity paperwork. Don’t rely on memory—get the actual language.
Build a timeline. When did you first conceive the idea? When did you build it? Where? On what device? What resources did you use?
Identify what problem it solves. Is it related to your job duties or the company’s current/planned business?
Preserve proof of independent work. Personal Git repos (created before any work disclosure), personal device metadata, dated notes, sketches, prototype videos—things that show it was yours, off-hours.
Stop mixing resources. If you’re still developing it, do it with your own equipment, on your own accounts, on your own time. Clean separation matters.
Be careful with internal disclosures. Sending the idea to coworkers, posting it in a company channel, or pitching it in a meeting can unintentionally strengthen the company’s claim and create evidence against you.

4) Can you negotiate? Sometimes, yes, and it can be smarter than a fight.

Not every company wants a scorched-earth dispute. Sometimes the business reality is simple. They may not want to commercialize it, but they also don’t want to risk anything either.

Possible outcomes that can be negotiated:

Written release: company confirms it has no claim
License back: the company owns it but licenses it to you or vice versa
Carve-out: company disclaims side projects meeting defined criteria
Compensation: bonus, royalty, or equity for company ownership
Joint ownership structure, which is less common, but sometimes workable

The earlier you handle it, the more options you typically have. Once lawyers start sending aggressive letters, positions harden.

Composite example based on common scenarios:

A software engineer builds a scheduling tool at home to help small clinics. On weekends, she codes on her personal laptop. The tool is not on her employer’s product roadmap, and it serves a different market.

But she had previously signed an invention assignment agreement with broad “relates to the business” language. She also used a small piece of logic inspired by a method her team used internally, and she discussed the tool idea on a company Slack channel.

The company claims ownership, though she believes it’s hers.

In cases like this, the outcome often depends on:

How similar the tool is to what the company does (or plans to do)
Whether confidential information was actually used
How strong the contract language is.

The solution might be a release or a license, if handled carefully and early. Rather than a costly, reputation-burning fight.

Overall, you’re still thinking, “My boss says my idea belongs to the company, is that true?

The honest answer is it depends on the paperwork! Find a lawyer who can help you sort out the fine lines and details! Your boss says your idea “belongs to the company,” and they might be right, but don’t take it as gospel because when someone at work says, “that belongs to the company,” they’re usually speaking from policy, habit, or leverage. Not a careful legal analysis of your specific facts.

If your idea has real value, you owe it to yourself to treat it like property: verify who owns it before you give it away.

If you want help sorting out where you stand, Tucker Law will help you through the process. Reviewing your employment documents, walking you through the facts, and helping you respond strategically. Whether that means pushing back, negotiating a clean carve-out, or protecting you from accidental missteps.

Call Tucker Law at 1-800-TUCKERWINS to talk through your situation.