What is a "work-for-hire"?
The work-for-hire doctrine dictates the authorship of a work for the purposes of copyright, when the work is made by one person or a company for another. This is an important nuance in copyright law and warrants a consultation with your attorney when entering into any arrangement where a work is created for another. By default, the author of a work owns the copyright in the work. If the work is a work-for-hire, then the owner of the copyright in the work is the person or company who employed or commissioned the author (e.g., artist, etc.) to create the work.
Where the author is an actual employee and the work is made within the scope of the employment, then the copyright belongs to the employer under the work-for-hire doctrine. To determine whether or not an author is an employee or not, typical common-law agency factors are considered, primarily, the degree of control of the employer over the employee in the creation of the work. Other factors which may be considered include, but are not necessarily limited to:
- the skill required (in the creation of the work)
- the source of the instrumentalities and tools (used in the creation of the work)
- the location where the work is created
- the duration of the relationship between the parties
- whether the hiring party has the right to assign additional projects to the hired party
- the extent of the of the hired party's discretion over when and how long to work
- the method of payment
- the hired party's role in hiring and paying assistants
- whether the hiring party is in business
- the provision of employee benefits, and
- the tax treatment of the hired party
A good example of an author who is an employee is an animator working with fellow animators for a studio: he or she goes to the studio throughout the week as scheduled, works on one or more projects at the direction of the studio, uses equipment and tools owned by the studio, receives a regular paycheck from the studio as well as health and pension benefits, etc. The only factor that weighs against the animator being considered an employee is the level of skill required, which is quite high for professional animators.
In the case where the work is created by an independent contractor for a contracting party, the copyright in the work will be owned by the independent contractor and not the contracting party, unless all of the requirements for the work-for-hire doctrine are met. Each of the requirements must be met, which is why it is so important to talk to your lawyer where the work-for-hire doctrine is implicated. The requirements for a work to be be considered a work-for-hire are:
- The work must be specially ordered or commissioned by the contracting party.
- There must be a written agreement between the parties specifying that the work is a work-for-hire.
- The work must be of one of the types specified by statute:
- a contribution to a collective work
- a part of a motion picture or other audiovisual work
- a translation
- a supplementary work
- a compilation
- an instructional text
- a test
- answer material for a test, or
- an atlas
The first requirement, that a work must be specially ordered or commissioned is usually met in the typical work-for-hire scenario. That is, where the contracting party approaches the independent contractor to create a specific work. Where the work has already been created, and the contracting approaches the author or artist to purchase the copyright in the completed work, then the first requirement is not met and the work-for-hire doctrine cannot apply.
The second requirement, that there must be a written agreement that explicitly specifies that the work is a work-for-hire, is not as often met and highlights why the parties should contact their attorneys to have a formal written agreement to determine where the copyright in the work rests after it has been created. The contracting party may have specially ordered or commissioned the work from the independent contractor, but they may not have memorialized their agreement in writing or may have a written contract without any reference to whether or not the work was made for hire.
The third requirement listed could be considered the gatekeeper requirement, because if the work does not belong to one of the types listed, then it cannot be a work-for-hire. Some major types of copyrightable works, such as music, are noticeably absent. For works of these types that cannot be a work-for-hire, the copyright in the completed work could still rest with the contracting party if there is a written assignment of the copyright to the contracting party (it still will not be a work-for-hire however).
Going back to the example of the animators and their employer studio, the animation is created in-house, by employees. The studio might not directly employ musicians, but rather hire out the musical score for the animation to a third party. As long as the studio is commissioning the third party to create the music, and a written agreement between the studio and third party specifies that the music is a work-for-hire, then the work will be a work-for-hire. The work type requirement is met here, because the work is "a part of a motion picture or other audiovisual work".
In either case, whether it is the animators or the third party musicians, both are still considered authors for the purposes of moral rights, even though they are not authors for the purposes of copyright.