The distinction between “employee” and “independent contractor” is not only important for employment law, but also for copyright law. With respect to the former, the category in which a worker is placed determines whether the worker is entitled to certain protections under labor laws, such as overtime, and to certain worker benefits, such as workers’ compensation. As for copyrights, ownership of “creative works” under the “work for hire” doctrine is partially determined by the creative person’s status as an “employee” or an “independent contractor.”

The new California Supreme Court opinion in Dynamex may have wide-ranging implications for copyrights in California, of very large importance in a part of the country where a massive number of writers, musicians, actors/actresses, and artists live and work.

San Diego Copyright Law: Work for Hire Doctrine and Dynamex

Under the Copyright Act of 1976, ownership of the copyright for creative or expressive works is owned by the creator. See Copyright Act, 17 U.S.C. § 201(a). However, if the expressive work is done “within the scope of” one’s employment, then ownership automatically vests with the employer or hiring entity. To avoid this, artists and creators often work as independent contractors. This allows them to retain ownership of the copyrights. A common example would be a “freelance” photographer; they may have taken various photographs at the direction of a magazine/news outlet, but they are not employed by them and retain copyright ownership of their work product.

In late April 2018, the California Supreme Court changed the test for determining whether a worker is an “employee” or an “independent contractor.” See Dynamex Operations West, Inc. v. Superior Court, 4 Cal.5th 903 (Cal. Supreme Court April 30, 2018). See our earlier discussion here.

Essentially, all workers in California are now “employees” unless the hiring entity can prove that they are not. One key fact that must be proven is that the worker does not provide work product that is central or core to the product/services provided by the hiring entity. For example, a freelance writer for a magazine is likely to be an “employee” under Dynamex because the magazine’s core product is written articles, which is the work done by a freelance writer.

This implicates copyright ownership. If the writer is an “employee,” then ownership defaults to the magazine. Because of the importance of social media advertising and promotions, this issue is relevant to ALL San Diego businesses because, increasingly, their employees are creating copyrightable creative works (such as marketing slogans). It will now be easier for employers to claim ownership of such works.

San Diego Copyright Law: Review Independent Contractor Agreements and Assignment

The first step for San Diego businesses is to have a good San Diego corporate lawyer review any and all independent contractor agreements and, with respect to intellectual property, review all intellectual property assignment agreements. The best way to avoid pitfalls created by Dynamex is to have legally sound and enforceable contracts and assignments.

Contact San Diego Corporate Law

For more information, contact attorney Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard provides a full panoply of legal services for San Diego and California businesses. Mr. Leonard can be reached at (858) 483-9200 or via email.

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