What Happens to Your IP When You Leave

Many employment contracts include an IP (intellectual property) assignment clause—where you agree that the company owns the work you create during employment. These clauses can cover inventions, code, designs, and sometimes "all work product." If the clause is broad, it might claim rights to side projects or ideas you develop on your own time. Knowing what the clause usually says, what you can keep, and what to look for before you sign can help you protect your own work. Here's what happens to your IP when you leave—and what to ask for before you sign.

What IP assignment usually covers

The clause typically says that the company owns: (1) inventions and works of authorship you create during employment, (2) that relate to the company's business or that you create using company resources, and sometimes (3) "all work product" or "all ideas" you have during employment—which can be read very broadly. In some contracts the scope is narrower: only work done "within the scope of employment" or "using company resources" is assigned. That's better for you—it means work you do on your own time, on your own equipment, and unrelated to the company's business may stay yours. But if the clause says "all inventions and works of authorship created during employment," it can be read to include side projects and ideas unrelated to the job. So the exact wording matters.

What you can often keep

In many jurisdictions you can often keep: (1) Pre-existing work that you disclose in writing when you join—the company shouldn't get rights to that if you've listed it. (2) Inventions unrelated to the company's business that you develop entirely on your own time without company resources—many contracts and some laws carve these out. (3) General skills and knowledge—you can't assign your general know-how; only specific inventions or works. If the contract doesn't have carve-outs for (1) and (2), ask for them. Many companies will add them. If they won't, understand the risk: you might lose rights to side projects or ideas you develop while employed.

What to look for before you sign

• Carve-out for pre-existing IP. When you join, disclose in writing any code, designs, or ideas you've already created that you'll use or build on. The contract should say the company doesn't get rights to that. If you don't disclose, you may lose it.
• Carve-out for unrelated work. Work that is (1) not related to the company's business, (2) developed entirely on your own time, and (3) without company resources, equipment, or confidential information should remain yours. Push for this in the contract.
• No claim to "background IP." Some contracts say the company gets a license to "background IP" you use in your work—which can mean tools, libraries, or methods you already had. Try to limit this to what's necessary for the job, or exclude your pre-existing IP.
• After you leave. The assignment usually only covers work created during employment. Work you create after you leave is yours—unless it's based on the company's confidential information or trade secrets, which you can't use anyway. So the main risk is work you create while employed; make sure the carve-outs protect that.

Practical tips

• Disclose pre-existing work when you join. Send a written list (email is fine) of any code, designs, or ideas you're bringing in. Keep a copy. That helps establish what's yours.
• BeforeYouSign can highlight IP and invention assignment language in your offer so you know what you're giving up and what to ask for before you sign.