Quick answer: An ip assignment clause transfers to you the intellectual property your India employee creates. Indian copyright law already makes the employer first owner of works made in the course of employment under a contract of service. Patents and pre-existing IP get no such default. So you need a signed, written assignment to close the gap.
- Section 17(c) of the Copyright Act, 1957 makes the employer first owner, unless an agreement says otherwise.
- The Patents Act, 1970 recognises only the true and first inventor, with no employer default.
- A copyright assignment is valid only if it is in writing and signed by the assignor (s.19(1)).
- An assignment that states no term is deemed to last five years, and one that names no territory covers India only.
Who owns an employee’s work in India by default?
It depends on the type of IP. Copyright and patents follow different rules.
| IP type | Default owner | What you need |
|---|---|---|
| Code, documents, designs made in the course of employment | Employer, under section 17 of the Copyright Act | A clause confirming it, plus a waiver of moral-rights objections |
| Inventions | The inventor | Written assignment so the employer can apply as assignee |
| Work made outside duties or before joining | The employee | Express assignment or a licence |
| Work by an independent contractor | The contractor | A signed assignment in the contract |
That last row trips up many foreign teams.
Contractors are not under a “contract of service”, so section 17 does not help you at all. Hence the clause matters even more if you convert contractors to employees later, because code they wrote before the switch stays theirs unless a signed document moves it to you.
What should an IP assignment agreement cover?
Five items, worded for Indian law. Use them in a standalone ip assignment agreement or inside the employment contract.
- A present assignment of all work product and inventions made in the course of employment
- Worldwide territory and the full term of protection, since section 19 defaults to India and five years
- A schedule of pre-existing IP the employee keeps, so nothing gets swept in by accident
- A duty to sign patent filings later, even after exit
- Confidentiality cross-referenced to your non-disclosure agreement (NDA)
Section 19(4) carries a quiet risk. An assigned right not exercised within one year can lapse unless the contract says otherwise. So say otherwise.
Suppose a Pune engineer writes a scheduling algorithm in March and your team ships it only in May of the following year. Without that wording, the gap alone invites a lapse argument.
Does side work belong to the employer?
Usually not, if it falls outside the person’s duties and uses none of your resources. Tie this to your moonlighting policy.
How does Remunance pass IP to you under an EOR?
The employee’s work belongs first to Remunance, as the legal employer. Our contracts then assign it onward to you, so ownership lands with your company and not with us. Our guide to the employer of record contract shows how the clauses chain together. Our independent contractor engagement and compliance work covers non-employees. To get both layers right from day one, get your IP chain reviewed.
What else do people ask about IP assignment in India?
Does an employer own employee inventions in India?
Not automatically. The Patents Act, 1970 has no employer-ownership default, so you need a written assignment from the inventor.
Is an IP assignment clause enforceable after the employee leaves?
Yes. Assignments of work already created stand after exit, and a clause obliging the person to sign later filings is a standard, enforceable add-on.
Do contractors in India need a separate IP assignment?
Yes. Section 17 covers employees under a contract of service, so a contractor keeps copyright unless they sign it over in writing.