On September 15, 2023, a new law was signed in New York that prohibits employers from requiring that employees assign certain intellectual property rights to their employer. This new law impacts policies and practices that have been in place for years and requires employers to review (and potentially modify) their policies and form agreements to avoid violating New York law.
WHAT?
New York Governor Kathy Hochul signed into law Section 203-F of the New York Labor Law, which prohibits employers from requiring an employee to “assign, or offer to assign, any of his or her rights in an invention to his or her employer . . . that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information[.]” By definition, any employee invention that was not developed entirely on the employee’s own time and/or without using the employer’s equipment, supplies, facilities, or trade secret information is not subject to this new prohibition.
The intent of the law is to balance the desire to protect employees from overbroad attempts to force employees to bargain away creative exercise with the desire to protect employers from seeing their investment of time and resources be used by an employee for personal gain. To that end, Section 203-F expressly carves out those inventions that still may be subject to assignment:
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