In Kenya, written contracts of service must provide for certain minimum terms and conditions of employment. These are specified in the Employment Act, 2007 and are:
- the name, age, permanent address and sex of the employee;
- the name of the employer;
- the job description of the employment;
- the date of commencement of the employment;
- the form and duration of the contract;
- the place of work;
- the hours of work;
- the remuneration, scale or rate of remuneration, the method of calculating that remuneration and details of any other benefits;
- the intervals at which remuneration is paid; and
- the date on which the employee’s period of continuous employment began, taking into account any employment with a previous employer which counts towards that period.
While there is no requirement in law for the employment contract to specify ownership of intellectual property created by an employee in the course of employment, it is important for this issue to be clearly spelt out in the employment contract, for the benefit of both parties, and particularly for the employer.
What is Intellectual Property
Intellectual property refers to intangible property created by an individual as a result of creative activity. In order to afforded legal protection, a person’s creative ideas and concepts must be expressed in some tangible form. Doing otherwise would make the intellectual property system impossible to regulate; people would claim ownership of ideas and concepts which the law would have no real or effective way of isolating, identifying, delineating and protecting.
Intellectual property rights include patents, design rights, trade marks, trade secrets, copyright and rights related to copyright such as rights in broadcasts. These rights are by nature monopolistic; they grant their owner certain exclusive rights to be enjoyed by them or by others with their consent, as any other property right. It is expected that protection of intellectual property spurs innovation; that by granting certain exclusive rights to the owner of intellectual property, society is inspired to create such intellectual property and this in turn creates innovations and creations which ultimately benefit the society in such a way that justifies granting the monopoly rights in the first place.
The law on employee inventions
Several inventions are invariably created by employees in the course of employment. These inventions may be protectable by the copyright laws-which protect literary, musical, artistic and dramatic works and ‘related’ rights derived from these such as broadcasts and sound recording-or they may be patentable-patents protect inventions that are new, non-obvious and capable of being used in industry. Both copyright and patent legislation in Kenya recognise copyright and patents created “in the course of employment” belong to the employer.
Under the Kenya’s Copyright Act, 2001, copyright in works protected by copyright vest initially in the author and shall be deemed transferred to the author’s employer, subject to any agreement between the parties excluding or limiting the transfer.
The Copyright Act does not go further to state the circumstances in which an employee’s copyright is to be deemed transferred to the employer, such as specifying that the work must be created ‘in the course of employment’, or during working hours, or using employer-provided resources, and these situations have largely been left to interpretation by the courts of law.
The Industrial Property Act, 2001 (“IPA”) addresses employee inventions and innovations in greater detail. Under the IPA, the right to a patent “…for an invention made in execution of…an employment contract shall belong to the person having commissioned the work or to the employer.” Where the contract does not require the employee to exercise any inventive activity but the employee has made the invention by using data or means available to him during his employment. Notably, in the latter case, that is, where the employee is not required to exercise inventive activity, the inventor employee has a right to “equitable remuneration taking into account his salary, the importance of the invention and any benefit derived from the invention by the employer.”
Inventions made without any relation to an employment or service contract and without the use of the employer’s resources, data, means, materials, installations or equipment shall belong solely to the employee.
Notably, employee creators of copyright protected works and patentable inventions have inherent rights to be recognised as authors (moral rights) and to be named as inventors (naming right) irrespective of the fact that the economic rights to these works and inventions belong to the employer.
The IPA also deals specifically with what is known as a technovation. A technovation is defined in the IPA as a “solution to a specific problem in the field of technology, proposed by an employee of an enterprise in Kenya for use by that enterprise, and which relates to the activities of the enterprise but which, on the date of the proposal, has not been used or actively considered for use by that enterprise”. There is no substantive test provided in law as to what may or may not qualify as a technovation but for the definition.
An employee who creates a technovation is entitled to a technovation certificate from his employer only where these are not in the field of activities for which he is employed or if it is, where the degree of the creative contribution inherent in the technovation “exceeds that which is normally required of an employee having the said duties.”
Where the enterprise uses the technovation or communicates it to a third person, the technovator (the employee inventor) shall be entitled to a remuneration which is to be agreed on by the parties or by an arbitral tribunal appointed jointly.
Gaps and challenges in legislation
The most apparent lacuna in the law is absence of Kenyan legislation on what amounts to creation or innovation by an employee in the “course of employment”, what kind of duties “exceeds that which is normally required of an employee having the said duties” and what “equitable remuneration” is.
Kenyan courts have on occasion been called upon to decide on some of these matters but the jury is largely still out.
In the 2012 High Court case between Samson Ngengi and the Kenya Revenue Authority, the facts of the case as reported in Kenyan media were that Mr Ngengi, an employee of KRA, developed a software (called GEOCRIS) that maps property location, ownership and building details, as well as the tax status of a taxpayer, which was an ideal software for the KRA to use to aid in collecting tax on rental properties. To our knowledge, there was no claim as to patentability of the software, and Mr Ngengi’s claims were for KRA to issue him with a technovation certificate and to remunerate him for the software solution. We are not aware of the court’s final determination in this matter. Nevertheless, examining the scanty facts here, it is evident, first, that in Kenyan law, copyright in software (such as GEOCRIS) if created pursuant to the employment contract, belongs to the employer. Copyright gives the owner the exclusive rights, for example, to use, sell and reproduce the work concerned. Secondly, if it was clear in Mr Ngengi’s employment contract, job description and normal duties at work that he was required to create software like GEOCRIS, arguably, he would not be entitled to a technovation certificate, but he may well be entitled to remuneration if KRA uses the software as the remuneration is not tied to whether or not the technovation created is part and parcel of the employee’s ordinary duties.
Kenya courts are generally persuaded by decisions of Commonwealth courts, particularly English court decisions, where legislative provisions are similar.
Conclusion
Copyright in copyright protected works created by an employee pursuant to a contract of employment belong to the employer. These include works such as legal opinions, artistic works, photographs, computer software and music.
Rights to a patent in inventions created in the course of employment by an employee who is required by virtue of his employment to exercise inventiveness belong to the employer. Where such an employee is not required to undertake inventive activities, the rights to a patent in any creation arising from the employee’s use of the employer’s resources nevertheless belong to the employer but the employee is entitled to equitable remuneration.
In the case of a technical solution to an existing problem created by an employee and which amounts to a technovation, the employer is required to provide such employee with a technovation certificate provided the duties of such employee do not comprise the making and proposing technovations pertaining to the field of the technovation and only if the degree of the creative contribution inherent in the technovation exceeds that which is normally required of an employee having the said duties. Additionally, provided the employer uses or communicates the technovation to a third party, the technovator employee is entitled to remuneration for his technovation.
From the foregoing, it is necessary for employers to clearly set out in the employment contracts what the job description and duties of an employee are to avoid ambiguities around whether or not a particular creation or innovation has been created in the course of employment. It would be advisable to word job descriptions and duties widely enough to cover inventions envisaged to likely to created by such an employee, though care must be taken not to have wide and ambiguous descriptions which would be counterproductive.
It is also worthwhile for the employer to ensure that employment contracts assert the employer’s ownership of works created during working hours and or using the employer’s resources.
The employer should also ensure job descriptions and duties are reviewed regularly, particularly in innovation-centric industries where roles and responsibilities change often with changing technologies, to ensure that these are updated and reflective of the employee’s actual continuing employment obligations.
It would be advisable for employers, especially for innovation-centred and technical fields, to develop innovation policies which employees are aware of. This will serve to accelerate innovations created within the workplace as the employees can be clear about their rights, such as the right to receive a technovation certificate for a technovation.