Employees’ Inventions

Employees are very inventive. This is shown by the fact that more than 80% of inventions filed in Germany arise in the context of the employment relationship. The law governing employee inventions should be noted here, under which the rights and obligations of the employee and the employer are laid down. Inventions, which must be patentable or capable of a utility model protection, are split up legally into service inventions and free inventions.

Service inventions are inventions which arise during the period of an unemployment relationship and which emerge from the occupational activity of the employee or are decisively based on experience or work at the company. For example, the invention of a new power take-off shaft, which has been made by an employee (e.g. a power take-off shaft designer, or even a doorman) of a power take-off shaft manufacturer, is a service invention.

The main obligation of the employee in connection with service inventions is the immediate reporting of the invention which, identified as such, must take place in text form to the employer. Along with the reporting of the invention, the problem and the solution of the invention must be described, wherein the description must be made sufficiently clearly for the employer to be able to understand it. In addition, the way in which service inventions come about (e.g. nature and extent of the participation of the employee) must be described. Once the report of the invention has been submitted to the employer, who is entitled to an appropriation right to the invention, the latter must immediately confirm in text form the receipt and the date of receipt. As from the receipt of the report of the invention, the time starts to run for the employer, since the latter can assert its release right within four months. If this deadline is missed, the invention is deemed to have been claimed. When a claim has been made, the invention is withdrawn from the sphere of influence of the employee and the employer alone is entitled, but also obligated, to apply for a protective right to this invention domestically without delay. If an application is filed, unless agreed otherwise, the employer must give the employee copies of the application documents, inform him of the progress with the procedure and, upon request, allow him to inspect the exchange of correspondence. The employee is obliged, upon request from the employer, to provide assistance with the drafting of the application documents. The employer is also entitled to file subsequent applications abroad; there is however no obligation to do so.

For free inventions, i.e. inventions which were made during the period of an employment relationship, but outside the sphere of activity of the employer, the employee has a reporting obligation. Through the report, the employer should be given the opportunity to verify whether it is in fact a free invention or whether it may perhaps be a service invention after all. If the employer arrives at the view that the invention, contrary to the employee's opinion, is a service invention, he must inform the employee of this within a period of three months from receipt of the report. If the employer allows this period to lapse, he can then no longer claim the invention even if it was actually a service invention. An example of a free invention by an employee of a power take-off shaft manufacturer would for example be the invention of a new toothbrush.

Since the employee should not go empty-handed due to the claiming of his invention, he has a claim to remuneration. This claim is in principle transferable, inheritable and distrainable. When a claim is made, the claim to remuneration by the employee arises when the claim is made and ends usually with the lapse or expiry of the protective right.

The determination of the appropriate remuneration is not a simple matter and requires a great deal of experience. The commercial applicability of the service invention, the duties and the position of the employee in the company and the company's share in bringing about the service invention are used as evaluation factors for the mathematical determination by means of a formula. If the inventive employee of the power take-off shaft manufacturer mentioned by way of example is a power take-off shaft designer, the latter will where possible receive a smaller remuneration than the gatekeeper of the power take-off shaft manufacturer.

The nature of the remuneration payment is not laid down in law and is therefore a matter for agreement. It has however become established that the payment takes place as an ongoing participation which is settled annually, as a lump sum settlement or as a mixture of the two. In any case, however, a possible remuneration is an incentive to the employee to be actively inventive.