Who Owns the IP When You Use a Contractor in Ontario
Many businesses assume that paying for work means owning it.
That assumption is incorrect.
Default Rule
In the absence of an agreement, the creator of the work owns the intellectual property.
This applies even if the work was commissioned and paid for.
Contractors vs Employees
Employees create IP for the benefit of the employer in the course of employment.
Contractors do not.
Unless there is a clear assignment, the contractor retains ownership.
Where This Becomes a Problem
The issue often surfaces during growth or transaction events.
A product is built by contractors. The company assumes ownership. A review reveals that assignments were never executed properly.
At that point, ownership is uncertain.
The Practical Takeaway
IP ownership is not implied by payment.
It must be explicitly assigned.
Without that, the business may not own what it believes it owns.