Month: February 2023

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GLOBAL ASSIGNMENT OF FUTURE WORKS OF AN EMPLOYEE: TOWARDS A PRAGMATIC APPROACH

 

In principle, apart from certain exceptions such as software, there is no automatic devolution of the economic rights of an employee author to his employer. Thus, when an employee creates a work of the mind (logo, photograph, text, etc.), within the framework of the execution of his employment contract, it is he, and not the employer, who benefits ab initio from the copyright on the work created. In order to allow the employer to peacefully exploit the various creations of his employees, it is necessary to formalize a transfer of the economic rights (while respecting a certain formalism).

 

In practice, two difficulties are regularly raised, as the law is not in line with the operational reality of companies: (i) the prohibition of the global transfer of future works (article L. 131-1 of the CPI) and (ii) the remuneration of the employee for the transfer of the economic rights of the author, which in theory must be distinct from his salary.

 

In a decision dated January 25, 2023 (RG 19/15256), the Paris Court of Appeal confirms a pragmatic position that provides companies with a certain legal certainty.

 

In this case, an employee (stylist and artistic director) criticized her employer for not having paid her for the economic rights related to the exploitation of her works in the context of collaborations between her employer and other companies. She claimed in particular that the assignment clause contained in her employment contract was null in that it was a global assignment of future works and that it was devoid of financial consideration.

 

 

1) The Court of Appeal validates the clause of transfer of works “as they are created

 

Because of the rule of the prohibition of global assignment of future works, a rather cumbersome mechanism should, in theory, be put in place by employers, consisting in regularly concluding written reiterations of copyright assignments with their employee authors. In addition to the burden of this cumbersome process, the employee may change his/her mind and not ratify such documents.

 

In order to circumvent this prohibition, which is clearly unsuited to the business world and the volume of creations, practitioners usually insert a clause providing for the transfer of works, in connection with the employee’s mission, “as and when” they are created.

 

The Court of Appeal confirms the validity of such a clause on the grounds that “[…] it limits the scope of the assignment to determinable and individualizable works, namely those created by the employee within the framework of the employment contract and as and when these works are created”.

 

This decision is thus welcome in that it confirms a flexible interpretation of article L. 131-3 of the CPI. This solution could perfectly apply to regular orders made to non-salaried authors.

 

 

2) The Court of Appeal seems to validate the absence of distinction between salary and copyright remuneration

 

In theory, the employment contract concerning an employee “author” must distinguish between two types of remuneration: (i) the salary for the performance/realization of the creation and (ii) a remuneration in copyright for the exploitation of the copyright related to the said creation. This breakdown can be difficult to implement in practice as these amounts are not subject to the same tax or contribution regime.

 

In its ruling, the court states that “a lump sum remuneration that does not distinguish between the remuneration of the work and the consideration for the transfer of the copyright is lawful”. In other words, the absence of a breakdown between an employee’s salary and the remuneration received by the latter for the transfer of copyright is therefore valid.

 

Here again, the court adopts a pragmatic approach. However, it is unfortunate that the court does not explain its reasoning. In any case, in the absence of a breakdown between salary and remuneration of copyright, the entire amount paid should be qualified as salary subject to the payment of social security contributions.

 

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Article rédigé par Véronique Dahan, Margaux Parmentier et Jérémie Leroy-Ringuet.