Employment Contract Interpretation - invention/creation
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I'd like some opinions about the following paragraph which appears in an employment contract I received recently. ======= Inventions and creations belong to the Company Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way, directly or indirectly, connected with the Company (collectively "Creations"), shall be the sole and exclusive property of the Company. The Employee agrees that all copyrightable works created by the Employee or under the Company's direction in connection with the Company's business are "works made for hire" and shall be the sole and complete property of the Company and that any and all copyrights to such works shall belong to the Company. To the extent such works are not deemed to be "works made for hire," the Employee hereby assigns all proprietary rights, including copyright, in these works to the Company without further compensation. ======= Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?
As others have said this is standard. I would just remind you that, like any contract negotiation, this is their offer. There is nothing wrong with you modifying it (spell out limits of 'indirectly') and presenting it as a counter offer. At the very least voice your concerns and have them clear up any language you consider too vague or unclear.
...cmk Save the whales - collect the whole set
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Leftyfarrell wrote:
Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?
yes i'd ask if they'd waive that.
Chris Losinger wrote:
Leftyfarrell wrote: Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention? yes i'd ask if they'd waive that.
No. The contract clearly states two key points: 1) That the works the company intends to own are those created "during the period of employment". This can be translated to the contracted times of employment (i.e. 9-5) so long as the work does not fall into the conditions of the second point... 2) The creations in question are only those based on work done that is "in any way, directly or indirectly, connected with the Company", "or under the Company's direction in connection with the Company's business". In other words, if you want to work out of hours on something that is (or could be considered to be) in any way loosely related to the company, then it is theirs. Otherwise it is yours, unless it falls under the period stated in point 1. So, no, if you want to make and run a website on the side (i.e. out of hours) that has nothing to do with the business, your employer does not own it. They may feel they could lay claim, but it would be easily defended under normal US and/or UK copyright law. JR
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Chris Losinger wrote:
Leftyfarrell wrote: Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention? yes i'd ask if they'd waive that.
No. The contract clearly states two key points: 1) That the works the company intends to own are those created "during the period of employment". This can be translated to the contracted times of employment (i.e. 9-5) so long as the work does not fall into the conditions of the second point... 2) The creations in question are only those based on work done that is "in any way, directly or indirectly, connected with the Company", "or under the Company's direction in connection with the Company's business". In other words, if you want to work out of hours on something that is (or could be considered to be) in any way loosely related to the company, then it is theirs. Otherwise it is yours, unless it falls under the period stated in point 1. So, no, if you want to make and run a website on the side (i.e. out of hours) that has nothing to do with the business, your employer does not own it. They may feel they could lay claim, but it would be easily defended under normal US and/or UK copyright law. JR
If his web business is functional during his hours then they can make a claim. Also, most employers can usually afford bigger legal fees than an individual. As an anecdote, a colleague of mine wrote a full helpdesk system whilst working for our company. He took legal advice on intellectual rights of the product (should he actually write it!) and was told that the company could make a claim against him. His wife had opted to stay at home to look after their young boys, but had been a developer. She took a short evening class in C++, bought a PC and the minimum of software and, voila, she "developed" the new product at home.;) He now employs 10 people in his successful business.
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Would you not say that if you approach the company with the idea then you have already "conceived" it while employed by the company and therefore it is their property. At least thats the way I see it... Cheers, David
You should certainly consider this, ideas you have whilst employed under this contract would be owned by the employer. Sometimes it is best to forget them and have them again later. In this case the OP hasn't signed the contract yet, so he doesn't have this problem.
Peter "Until the invention of the computer, the machine gun was the device that enabled humans to make the most mistakes in the smallest amount of time."
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If his web business is functional during his hours then they can make a claim. Also, most employers can usually afford bigger legal fees than an individual. As an anecdote, a colleague of mine wrote a full helpdesk system whilst working for our company. He took legal advice on intellectual rights of the product (should he actually write it!) and was told that the company could make a claim against him. His wife had opted to stay at home to look after their young boys, but had been a developer. She took a short evening class in C++, bought a PC and the minimum of software and, voila, she "developed" the new product at home.;) He now employs 10 people in his successful business.
sirius-black wrote:
If his web business is functional during his hours then they can make a claim.
That's true, but only if his "declared" hours of work as an employee of his web business conflicts with his contracted hours.
sirius-black wrote:
Also, most employers can usually afford bigger legal fees than an individual.
Also, absolutely true, however I recently received a link to a great recourse (from guess who!) http://www.codeproject.com/News.aspx?id=3890[^] Free legal advice is often all you need to scare off a "big" company who are just chancing their arm on a dodgy case. There are actually many lawyers (good ones too) who will take a blatant case of copyright infringement on pro-bono. The idea that it is not worth taking on mr big and faceless because he has deeper pockets and better lawyers is no longer a serious factor. The fact of the matter is the contract is a standard one, often seen in modern technological companies. If you feel you can or should renegotiate the clause, then by all means do so, but it is there for a reason as far as the company is concerned and I highly doubt it would be anything but a deal breaker to remove it.
sirius-black wrote:
As an anecdote, a colleague of mine wrote a full helpdesk system whilst working for our company. He took legal advice on intellectual rights of the product (should he actually write it!) and was told that the company could make a claim against him. His wife had opted to stay at home to look after their young boys, but had been a developer. She took a short evening class in C++, bought a PC and the minimum of software and, voila, she "developed" the new product at home. He now employs 10 people in his successful business.
Nice one, but what happens if they get divorced? :laugh: JR -- modified at 7:00 Wednesday 15th August, 2007
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I'd like some opinions about the following paragraph which appears in an employment contract I received recently. ======= Inventions and creations belong to the Company Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way, directly or indirectly, connected with the Company (collectively "Creations"), shall be the sole and exclusive property of the Company. The Employee agrees that all copyrightable works created by the Employee or under the Company's direction in connection with the Company's business are "works made for hire" and shall be the sole and complete property of the Company and that any and all copyrights to such works shall belong to the Company. To the extent such works are not deemed to be "works made for hire," the Employee hereby assigns all proprietary rights, including copyright, in these works to the Company without further compensation. ======= Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?
Leftyfarrell wrote:
Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?
Yes. You can contest it, especially if you use a different programming language at home, but the least they will get is partial intellectual copyright. Point out to them that you do other work at home, that is not connected to your job, and ask them to modify the clause to include only work related to their business. That will put them in the position of having to contest the clause (which they probably will, if it makes money), by, for example, showing that ideas you had whilst at work improved the design of your home project. If they refuse to modify the contract, then don't work for them. If they treat their employees badly in this way, they will also be treating them badly in other ways.
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Chris Losinger wrote:
Leftyfarrell wrote: Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention? yes i'd ask if they'd waive that.
No. The contract clearly states two key points: 1) That the works the company intends to own are those created "during the period of employment". This can be translated to the contracted times of employment (i.e. 9-5) so long as the work does not fall into the conditions of the second point... 2) The creations in question are only those based on work done that is "in any way, directly or indirectly, connected with the Company", "or under the Company's direction in connection with the Company's business". In other words, if you want to work out of hours on something that is (or could be considered to be) in any way loosely related to the company, then it is theirs. Otherwise it is yours, unless it falls under the period stated in point 1. So, no, if you want to make and run a website on the side (i.e. out of hours) that has nothing to do with the business, your employer does not own it. They may feel they could lay claim, but it would be easily defended under normal US and/or UK copyright law. JR
JR Ryan wrote:
"in any way, directly or indirectly, connected with the Company",
"in any way, directly or indirectly" - notice how bright and sharp the line is! :laugh: a Company that wanted your product wouldn't have to try too hard to find a way to say it's "in some way, indirectly" related to their business. best to just not have that clause to deal with.
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Thanks for your opinion. In this case, it is an employment contract for a position I am considering taking, but have not yet signed. I just wanted to gather some opinions on its meaning. I can understand the employer wanting to capitalize on inventions related to their business during my employment, but I obviously disagree with them owning an idea that is unrelated to their business and the work I do for them. If I signed this contract, wouldn't it give them a claim on Firefox or any other open source projects that I might work on in my spare time? That sounds unreasonable to me.
This is pretty usual "we own you" rubbish. I'd sign it, but strike out that clause and initial the change while doing so. If they object, start negotiating. If not, you're in - but remember to keep a copy of the original in a safe place in case a dispute arises in future.
Anna :rose: Linting the day away :cool: Anna's Place | Tears and Laughter "If mushy peas are the food of the devil, the stotty cake is the frisbee of God"
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I'd like some opinions about the following paragraph which appears in an employment contract I received recently. ======= Inventions and creations belong to the Company Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way, directly or indirectly, connected with the Company (collectively "Creations"), shall be the sole and exclusive property of the Company. The Employee agrees that all copyrightable works created by the Employee or under the Company's direction in connection with the Company's business are "works made for hire" and shall be the sole and complete property of the Company and that any and all copyrights to such works shall belong to the Company. To the extent such works are not deemed to be "works made for hire," the Employee hereby assigns all proprietary rights, including copyright, in these works to the Company without further compensation. ======= Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?
Hi, If you are uncertain, have an attorney look at it. Remember: Law and logic are not the same. For example, does "period of employment" mean 9AM to 5PM, or does it mean the period during which you are employed with the company, for example January 1, 2007 to December 31, 2007. My guess is that it is the latter. Also, in law, commas a VERY important. Consider the following clause: "Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way..." Now consider this verion that I made up: "Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived, or made or may conceive or make during the period of employment in any way..." Notice the comma after conceived in the version I made up. This simple comma gives them rights to anything you created, even before your time with the company. Only a lawyer can tell you for certain what this contract means. Don't fall for the "standard contract" line. Also interpretations of contracts change across jurisdictions. This means that intellectual property contracts are enforced by courts in different ways in different states. Never "just sign". Some of these contracts are pretty bad. After 1 month of negotiations I turned down an excellent job with a firm because of their bad contract. Left as they wanted, they would own everything I ever worked on, or would ever work on. Additionally, their complex legal wording barred me from working for any company on the planet Earth for one year following employment with them (any client, perspective client, blah blah). Hope this helps... SomeGuySomewhere
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The clause above applies to an employment contract for a full time employee on salary.
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Leftyfarrell wrote:
Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way, directly or indirectly, connected with the Company (collectively "Creations"), shall be the sole and exclusive property of the Company.
Which is why I'm a consultant. If I create something on my time, it's mine, not the "Company's". And the rest is more of the same--we own you and what you do, think, and piss 24/7/365. You should ask them if any children conceived during the period of employment, directly or indirectly with a woman, is also the sole and exclusive property of the Company. You are performing an act of creation, after all. Maybe they'll pay for the diapers. Marc
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I'd like some opinions about the following paragraph which appears in an employment contract I received recently. ======= Inventions and creations belong to the Company Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way, directly or indirectly, connected with the Company (collectively "Creations"), shall be the sole and exclusive property of the Company. The Employee agrees that all copyrightable works created by the Employee or under the Company's direction in connection with the Company's business are "works made for hire" and shall be the sole and complete property of the Company and that any and all copyrights to such works shall belong to the Company. To the extent such works are not deemed to be "works made for hire," the Employee hereby assigns all proprietary rights, including copyright, in these works to the Company without further compensation. ======= Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?
Leftyfarrell wrote:
To the extent such works are not deemed to be "works made for hire," the Employee hereby assigns all proprietary rights, including copyright, in these works to the Company without further compensation.
So, no matter when or where you worked on it, related or not, this catch-clause grabs everything. Ruunnnnnn!:omg:
"Neque porro quisquam est qui dolorem ipsum quia dolor sit amet, consectetur, adipisci velit..." "There is no one who loves pain itself, who seeks after it and wants to have it, simply because it is pain..."
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Chris Losinger wrote:
Leftyfarrell wrote: Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention? yes i'd ask if they'd waive that.
No. The contract clearly states two key points: 1) That the works the company intends to own are those created "during the period of employment". This can be translated to the contracted times of employment (i.e. 9-5) so long as the work does not fall into the conditions of the second point... 2) The creations in question are only those based on work done that is "in any way, directly or indirectly, connected with the Company", "or under the Company's direction in connection with the Company's business". In other words, if you want to work out of hours on something that is (or could be considered to be) in any way loosely related to the company, then it is theirs. Otherwise it is yours, unless it falls under the period stated in point 1. So, no, if you want to make and run a website on the side (i.e. out of hours) that has nothing to do with the business, your employer does not own it. They may feel they could lay claim, but it would be easily defended under normal US and/or UK copyright law. JR
"That the works the company intends to own are those created "during the period of employment". This can be translated to the contracted times of employment (i.e. 9-5)" "During the period of employment" is ambiguous: It could ALSO mean from the job's start date to the termination date. Also, you can certainly ask them to exclude a project that you will do on your own time, but many employers frown on that, and won't hire you: They don't want you thinking about your project instead of work. This kind of clause is illegal in California, as it should be. But employers can get away with it elsewhere.
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Thanks for your opinion. In this case, it is an employment contract for a position I am considering taking, but have not yet signed. I just wanted to gather some opinions on its meaning. I can understand the employer wanting to capitalize on inventions related to their business during my employment, but I obviously disagree with them owning an idea that is unrelated to their business and the work I do for them. If I signed this contract, wouldn't it give them a claim on Firefox or any other open source projects that I might work on in my spare time? That sounds unreasonable to me.
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Chris Losinger wrote:
Leftyfarrell wrote: Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention? yes i'd ask if they'd waive that.
No. The contract clearly states two key points: 1) That the works the company intends to own are those created "during the period of employment". This can be translated to the contracted times of employment (i.e. 9-5) so long as the work does not fall into the conditions of the second point... 2) The creations in question are only those based on work done that is "in any way, directly or indirectly, connected with the Company", "or under the Company's direction in connection with the Company's business". In other words, if you want to work out of hours on something that is (or could be considered to be) in any way loosely related to the company, then it is theirs. Otherwise it is yours, unless it falls under the period stated in point 1. So, no, if you want to make and run a website on the side (i.e. out of hours) that has nothing to do with the business, your employer does not own it. They may feel they could lay claim, but it would be easily defended under normal US and/or UK copyright law. JR
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I'd like some opinions about the following paragraph which appears in an employment contract I received recently. ======= Inventions and creations belong to the Company Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way, directly or indirectly, connected with the Company (collectively "Creations"), shall be the sole and exclusive property of the Company. The Employee agrees that all copyrightable works created by the Employee or under the Company's direction in connection with the Company's business are "works made for hire" and shall be the sole and complete property of the Company and that any and all copyrights to such works shall belong to the Company. To the extent such works are not deemed to be "works made for hire," the Employee hereby assigns all proprietary rights, including copyright, in these works to the Company without further compensation. ======= Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?
Actually I don't think it does. Consult a lawyer though. But the key point is that it has to be connected to the business. So if you do something on the side that is connected to their business then it does.
Leftyfarrell wrote:
directly or indirectly, connected with the Company (collectively "Creations"),
This statement was never false.
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Chris Losinger wrote:
Leftyfarrell wrote: Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention? yes i'd ask if they'd waive that.
No. The contract clearly states two key points: 1) That the works the company intends to own are those created "during the period of employment". This can be translated to the contracted times of employment (i.e. 9-5) so long as the work does not fall into the conditions of the second point... 2) The creations in question are only those based on work done that is "in any way, directly or indirectly, connected with the Company", "or under the Company's direction in connection with the Company's business". In other words, if you want to work out of hours on something that is (or could be considered to be) in any way loosely related to the company, then it is theirs. Otherwise it is yours, unless it falls under the period stated in point 1. So, no, if you want to make and run a website on the side (i.e. out of hours) that has nothing to do with the business, your employer does not own it. They may feel they could lay claim, but it would be easily defended under normal US and/or UK copyright law. JR
JR - Is that specific, valid legal advice? I'm not a lawyer, but I've seen similar contracts, and I've had discussions about this topic for exactly the same reasons as the original poster. I've received different responses, too, which doesn't help. In one place, they basically said "If you want to sell Amway, or build furniture, we don't care. That's not our business. You want to sell some software you write - we need to talk." The best advice was given earlier - get a lawyer familiar with the IP laws and rulings in your locality (city/state/etc.) to give and interpretation, and talk to the company about what it means to them (i.e. their interpretation). There's usually some sort of language that say "... and for a period of NNN years after termination of employment" that's been an issue for me on other employment contracts. There's always the option of proposing "let's add exclusions for the following projects/ideas", but then if it's a good idea, you probably don't want to reveal it to them at this point. CWW
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I'd like some opinions about the following paragraph which appears in an employment contract I received recently. ======= Inventions and creations belong to the Company Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way, directly or indirectly, connected with the Company (collectively "Creations"), shall be the sole and exclusive property of the Company. The Employee agrees that all copyrightable works created by the Employee or under the Company's direction in connection with the Company's business are "works made for hire" and shall be the sole and complete property of the Company and that any and all copyrights to such works shall belong to the Company. To the extent such works are not deemed to be "works made for hire," the Employee hereby assigns all proprietary rights, including copyright, in these works to the Company without further compensation. ======= Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?
This is a standard draconian Inventions clause, I've seen this almost word for word on other contracts.
Leftyfarrell wrote:
Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?
The short answer is yes. Any lawyer will tell you that the final decision rests in the hands of the courts, but if you invent a better "sticky note" (to use an example above), that "sticky note" belongs to the company, unless you're putting up a legal battle. I would check the rest of your contract for a definition of "Period of Employment", but this is typically not just a "9 to 5" thing. If you have any leeway in negotiations, I would bring up this point on the contract and discuss the ramifications with your boss. For example, if you've posted articles on this site you've been posting your own copyrighted materials. Talk to the "future" boss and tell them that writing articles was important for your Professional Development (and part of the reason they wanted you), but that you can no longer this activity under the current clause b/c you can't post Copyrighted works owned by the company. If you currently have contracts outside of work, bring that up as well, tell them that you have running clients outside of 9 to 5 and that they'll either have to change the contract or pay you significantly more to make up for the lost income potential of "not having thoughts of your own". This contract is typical of a company trying to defend its interests. If you're a creative or innovative person, this type of clause may hold you back from dealing with the company, but if you're not doing work on your own, then it's not really relevant. Of course, if you are creative and innovative (or better yet have a history of such), you should definitely explain this to your bosses and tell them quite clearly that they get one chance. If you create something that makes money, then you expect them to pay you quite well for that invention or you're leaving and making the situation publicly known (which makes it very hard to attract talent).
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Hi, If you are uncertain, have an attorney look at it. Remember: Law and logic are not the same. For example, does "period of employment" mean 9AM to 5PM, or does it mean the period during which you are employed with the company, for example January 1, 2007 to December 31, 2007. My guess is that it is the latter. Also, in law, commas a VERY important. Consider the following clause: "Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way..." Now consider this verion that I made up: "Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived, or made or may conceive or make during the period of employment in any way..." Notice the comma after conceived in the version I made up. This simple comma gives them rights to anything you created, even before your time with the company. Only a lawyer can tell you for certain what this contract means. Don't fall for the "standard contract" line. Also interpretations of contracts change across jurisdictions. This means that intellectual property contracts are enforced by courts in different ways in different states. Never "just sign". Some of these contracts are pretty bad. After 1 month of negotiations I turned down an excellent job with a firm because of their bad contract. Left as they wanted, they would own everything I ever worked on, or would ever work on. Additionally, their complex legal wording barred me from working for any company on the planet Earth for one year following employment with them (any client, perspective client, blah blah). Hope this helps... SomeGuySomewhere
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I'd like some opinions about the following paragraph which appears in an employment contract I received recently. ======= Inventions and creations belong to the Company Any and all "Creations" (i.e. inventions, discoveries, improvements, or creations) which the Employee has conceived or made or may conceive or make during the period of employment in any way, directly or indirectly, connected with the Company (collectively "Creations"), shall be the sole and exclusive property of the Company. The Employee agrees that all copyrightable works created by the Employee or under the Company's direction in connection with the Company's business are "works made for hire" and shall be the sole and complete property of the Company and that any and all copyrights to such works shall belong to the Company. To the extent such works are not deemed to be "works made for hire," the Employee hereby assigns all proprietary rights, including copyright, in these works to the Company without further compensation. ======= Does this mean that if I start my own home business on the side, and build a website that conducts business in a totally unrelated field to that of my employer, they could still lay a claim to that business/website/invention?