Intellectual property and invention rights for global teams: What every company needs to know

When everyone works in the same office, intellectual property (IP) rights are fairly straightforward. Employees produce work on company time, using company property, at the company’s office, and that work belongs to the company. 

This traditional structure insulates businesses from most claims against their IP and invention rights, but remote work changes the dynamic by introducing new vulnerabilities. 

That’s not to say companies should avoid hiring employees in other countries — after all, a global workforce helps them remain competitive. However, companies should avoid unnecessary risk while growing their global teams.

Remote helps businesses with workers in dozens of countries protect their IP from both internal and external vulnerabilities. Let’s look at the challenges of international law and examine how Remote provides the best IP and invention rights protection in the industry.

What is intellectual property? 

The formal definition of intellectual property (IP) is “creations of the mind” or intangible assets. 

IP may not be physical property a company can own, but it still plays a pivotal role in an organization’s success. 

By protecting IP in law, you can stop others from using your ideas without your consent. In addition to infringement from competitors, a potential threat is that employees could steal information they obtain in their jobs. 

IP protection ensures new IP is properly assigned to the company so that the company can maintain control over it, obtain legal protection of it, and secure access to it.

On a global scale, having a legal framework for IP protection helps foster innovation by incentivizing firms to develop new ideas.

Types of IP

The main types of IP assets are as follows:

• Patents

• Trademarks

• Copyrights

• Trade secrets

For instance, if a business comes up with a name for a new product, trademark registration can prevent a competitor from using the same name. Or if a software engineer develops an application, they can file a software patent to stop a big corporation from copying them.

Why IP protection matters for global teams

IP protection is relatively simple to uphold when all employees work under the same roof. But when an organization operates globally or has remote teams working from their own homes, it becomes more complex.

Global rules

Employees may be working in countries with distinct guidelines regarding IP. Some countries have more relaxed rules than others, and there are differences in how companies assign exclusive rights.

For instance, some countries favor companies with their IP legislation, while others give more ownership rights to independent contractors and employees. In other words, if an employee develops an idea while working for their employer, they may be able to obtain the rights to it.

Data access

Another complication is the potential for flimsy data protection. When working remotely, employees access company data and information from the cloud via their own home networks and devices. This makes the information more vulnerable to hackers and phishers. 

And unfortunately, it only takes one employee to suffer a data security breach after using a public network to bring the whole ship down.

The dangers of poor IP protection

The IP strategies a company uses in one country may not work in another. Failure to understand, respect, and follow the laws of another country could result in a loss of protections for the company’s IP and invention rights.

Losing these protections can lead to a host of problems: some small, others catastrophic.

Losing deals

Security is more important than ever. Potential partners want to work with companies that have robust protections in place. If you cannot promise potential customers that you own all you say you do (and will continue to do so), you could lose major deals.

On the other hand, strategic approaches to IP protection can help you increase your market share, build new revenue streams, and foster continuous innovation in your industry.

Failing an audit

Are you subject to inspection from regulators? If so, you cannot afford to leave your IP and invention rights to chance.

Liquidity events, like sales and IPOs, often result in audits, which involve investigating whether a company is protecting its IP. Failure to protect IP can cause issues for shareholders later, so they will want to protect themselves by ensuring you’re following proper procedures now.

Reputation damage

No company wants to be in the news for the wrong reason. An accusation from an employee or contractor that the company stole IP is definitely the wrong reason. With the proper protections in place, though, disputes end quietly before things get ugly and cause damage to your reputation.

For example, in 2019, CNEX sued Huawei, accusing the Chinese company of stealing trade secrets. This case of potential infringement gave Huawei a poor reputation in the US, which still affects how the firm is perceived today.

Legal battles

Without proper protections regarding remote workers in foreign countries, you could find yourself dragged into costly legal battles, fighting in another country’s court system to keep your own IP. These battles can be difficult to win, especially in countries where laws on creation favor creators over companies.

In the above example of Huawei and CNEX, the trade secrets conflict involved costly legal action as well as reputational damage.

Loss of IP 

In some countries, IP rights default to the creator over the commissioner. So, if your company works with an international contractor, the IP for their work may default to the contractor (without a watertight contract). 

Employment contracts tend to be more secure than contractor agreements, but companies can still lose IP and invention rights protections in foreign countries.

For instance, in the Netherlands, employees can register a trademark in their name if they create it during their employment. This can come as a shock for companies that operate in a jurisdiction where this would never happen.

The worst danger, however, arises when a company fails to realize it’s at high risk of IP infringement. Some global employment solutions providers rely on third parties, passing their customers' IP back and forth between multiple places. 

This is where an owned-entity global employment solution offers a clear competitive advantage over a partner-dependent global employment solution.

Where IP protection matters most

Which companies should care about IP and invention rights with remote workers?

The short answer is all of them. If you have workers abroad, you need to be concerned about protecting your IP and invention rights. Even if you don’t believe you have much IP, you probably do. Your brand, for example, is part of your IP.

Now that it’s easier than ever for companies of all sizes to employ international workers, every startup should take IP protection seriously from the beginning. This helps avoid major headaches down the road.

However, certain businesses should pay special attention to IP rights due to their industry's unique market conditions and features. These include those in the following fields:

Tech

IP and invention rights for tech companies can be complicated . Many countries lack the proper regulations to account for all the different types of tech IP and methods of creation. Businesses working with foreign engineers, programmers, product managers, and other tech talent must be especially vigilant.

Finance

Every highly regulated industry requires the highest levels of protection across the board. In finance, companies working with new clients often go through internal audits, including the levels of protection for IP.

Energy

Invention rights are especially important for energy companies. Drawing the line between what belongs to the company versus employees can help businesses in this sector avoid costly legal battles and negative press.

Manufacturing

In manufacturing, every piece of machinery has different types of IP and protected inventions. Manufacturing companies exercise enormous caution to prevent industrial espionage, so why wouldn’t these same companies take every precaution to protect their IP?

Startups 

Startups should be especially careful regarding invention rights and IP. That goes double for startups looking at a liquidity event, like an acquisition or IPO.

The due diligence for such an event requires evaluations of not only IP protections but also relationships with employees and contractors. The last thing a startup needs before an IPO is uncertainty regarding ownership of the work it has created.

4 intellectual property protection tips for global teams

Failing to protect your IP and invention rights comes with consequences. On the other hand, successfully protecting those rights insulates your business from harm while empowering you to grow your global team with confidence.

The tips below will put you in the second camp.

1. Register your IP quickly

The quicker you register your IP, the easier it is to defend a copyright infringement. You can prove that you registered the IP before another party used it, reducing doubt over ownership rights.

In the US, you can register your IP through the US Patent and Trademark Office or the US Copyright Office, depending on the type of valuable asset you want to protect. Other countries have equivalent offices.

Registration isn’t mandatory in most places, so failing to register IP won’t necessarily mean that you’ve lost the right to your property. However, it does provide you with documentation that will be useful if you have to take legal action.

Also, the World Trade Organization (WTO) has an agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which sets minimum standards for member countries.

Similarly, the World Intellectual Property Organization (WIPO) has a Patent Cooperation Treaty (PCT) that stands across multiple countries.

2. Ask employees to sign non-disclosure agreements

Around a third of all American workers sign non-disclosure agreements (NDAs), also known as confidentiality agreements or proprietary information agreements. These contracts are a good way to ensure that anyone you work with (and expose to your IP) legally agrees to keep the information confidential. They don’t use it themselves or give it to competitors.

NDAs are typically signed by employees, but don’t forget to also ask any freelancers, contractors, or partners in joint ventures to sign them, as well.

Also, remember that an NDA is only as useful as the information it contains. Always seek legal advice from a professional to ensure the agreement is watertight.

3. Be smart about cybersecurity

Cybersecurity is a growing issue for many firms — in fact, cybercrime has more than doubled since the COVID-19 pandemic. It’s particularly important for global teams due to the extra security risks they’re exposed to from employees using their own devices, as outlined earlier.

To reduce potential risks and protect their IP, companies must identify threats and weaknesses in their security systems. One of the best ways to do this is by conducting regular audits of data security processes, especially firewalls and encryption.

It’s also wise to educate employees on IP asset protection and cybersecurity protocols to get everyone on the same page and create a culture around cyber protection. Ideally, this should be part of your onboarding process.

Also, keeping devices and programs up to date helps ensure a high level of security.

4. Create remote work policies 

Remote work policies outline a company’s expectations for employees who work remotely. This includes guidance on accessing company data and securing their devices. 

It’s important to continually review and refresh your remote work policy to ensure your employees are accessing only the most up-to-date information.

It might sound daunting to create a policy like this, but companies like Remote can help — we outline how below.

How Remote protects IP and invention rights

Remote offers the most secure, most reliable IP and invention rights protections in the industry. In fact, we offer a higher level of protection than directly transferring IP from your international employees to your company.

It may sound strange, but this is possible because countries have different laws on how IP enters and exits the country. Below, we list how we can maximize your IP protection.

Learn how Remote protects your IP around the world with Remote IP Guard.

We own our own in-country entities.

Some global employment solutions providers do not own their own entities. Instead, they rely on partners to handle the workload on their behalf. Not only is this model more expensive for customers, but it also means your IP gets passed through multiple parties before finally reaching you. All that movement exposes your IP to unnecessary risk at every exchange.

Remote owns our own legal entities in every country where we offer global employment services. That means we never ask an intermediary to take possession of your IP. We are your global employment partner, and we provide our services directly to you.

We use an ironclad two-step IP transfer process

As a global employment solutions provider, we offer a variety of services. Sometimes, we simply handle global payroll for your own local entities. Other times, we employ your workers on your behalf with our in-country entities, allowing you to hire all over the world without expensive overhead.

When we employ workers on your behalf, we use a two-stage approach to transfer the IP from the employee to you. First, we transfer the IP from the employee to Remote in accordance with our country-specific employment agreements. Then, we transfer the IP to you. As international experts in IP and invention rights laws, we guarantee the maximum transfer of IP to you every time. The IP belongs to you from the beginning, and we guarantee you receive it legally and easily thanks to our best-in-class service.

We deliver you maximum protections under every country’s local laws

You don’t have to be an expert in international IP law to hire internationally. We take care of everything to provide you with the highest level of protection in every country where you have employees. Remote’s in-country teams of legal experts craft employee agreements that comply with all applicable local laws, allowing you to rest easy.

What happens if your employees move to a new country? Don’t worry: we take care of that, too. Because we own our own legal entities, we have an international network of legal experts ready to help from start to finish. The power of a global infrastructure with the precision of a local legal team — that’s the Remote difference.

Protect your IP and your global team with Remote

Remote’s global employment solutions include payroll, benefits, taxes, and compliance to empower companies of all sizes to employ top talent all over the world. We protect your IP and invention rights better than anyone else and provide global teams with a first-class experience.

Contact us today to learn how Remote can help you grow your global team securely.