A recently enacted New York State law that took effect immediately restricts employers’ use of employment agreements which require that employees assign to their employer rights to inventions that were created by the employee on his/her own time and without the use of the employer’s resources.
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On September 15, 2023, Governor Kathy Hochul signed Senate Bill (S) 5640 into law, which amends New York State Labor Law, to make unenforceable employment agreement provisions that require employees to assign their rights to inventions developed on their own time and with their own resources.
Specifically, the new law states that employers cannot include a provision to assign inventions that are developed by employees “entirely on [their] own time without using the employer’s equipment, supplies, facilities, or trade secret information.” The law further deems such a provision “against the public policy” of New York State.
Importantly, however, the new law does not apply inventions by employees that either relate to their “employer’s business, or actual or demonstrably anticipated research or development” or inventions that “result from any work performed by the employee for...
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