New York Limits Employee Assignment of Inventions Developed Using Own Time and Resources | Practical Law

New York Limits Employee Assignment of Inventions Developed Using Own Time and Resources | Practical Law

New York amended its labor law to render unenforceable employment agreement provisions that require employees to assign to their employers inventions created entirely using the employee's own time and resources.

New York Limits Employee Assignment of Inventions Developed Using Own Time and Resources

by Practical Law Intellectual Property & Technology
Published on 22 Sep 2023 • USA (National/Federal)
New York amended its labor law to render unenforceable employment agreement provisions that require employees to assign to their employers inventions created entirely using the employee's own time and resources.
On September 15, 2023, New York enacted S.B. 5640, which amended state labor law concerning inventions made by employees. Modeled after a 2011 California statute, NY Labor § 203-f:
  • Renders employment agreement provisions unenforceable if they require employees to assign to their employers the rights to inventions developed entirely using the employee's own property and time.
  • Exempts from the new law's scope inventions created:
    • with actual or demonstrably anticipated research of the employer; or
    • from work performed by employees in the course of their work for the employer.
The state legislature passed NY Labor § 203-f to:
  • Protect employees from overly broad employment contracts.
  • Incentivize employee innovation.
  • Increase private sector efficiency and spur economic growth.
The law became effective immediately upon Governor Hochul's signature.