What happened
The Ontario Court of Appeal has ruled that a software developer, not his employer, owns the copyright in a program he built while on the payroll, as reported by Talent Canada in an article by lawyers at Cassels Brock & Blackwell. The case is Nexus Solutions Inc. v. Krougly.
Nexus sells emissions monitoring software. Its employee, Vladimir Krougly, secretly built a competing product and marketed it to some Nexus customers after he resigned. Nexus argued it owned the copyright because he made it during his employment. The trial judge disagreed, and the Court of Appeal upheld that result.
The courts looked at whether the employer had actually assigned the work. Krougly was never asked to build the software. He worked outside business hours, used none of Nexus's property, and Nexus spent nothing on it. He had no written employment contract, and nothing barred side projects or addressed who owned what he created. The Court said the key question is whether the work was something the employee was asked or expected to do as part of the job.
Why it matters if you are hiring
This is most relevant if you employ developers, data people, engineers or anyone who creates work product. Breaching a company policy does not by itself hand the employer the copyright. Under the Copyright Act, the default is that the author owns the work, and the employer's claim depends on the work being made in the course of employment and on any agreement to the contrary.
In practice, the offer letter or employment agreement carries real weight. A hire with no written terms on intellectual property, outside work or confidentiality leaves you relying on a fact-heavy argument about duties and resources. Nexus lost that argument even though the product competed with its own.
It also affects how you scope roles. The Court found that a plan to build a next-generation product someday did not make it part of this employee's job. If you expect a person to build new tools, say so in the job description and the agreement.
One thing to do this week
Pull the employment agreements for your technical and creative roles and check three things: a clause assigning ownership of work made in the course of employment, a clear statement on whether outside projects are allowed and under what conditions, and a confidentiality term. Anyone hired without a written agreement should be flagged for review with employment counsel.
Closing
Traverse places developers, data specialists and other technical people with Canadian employers who want the right hire in the seat and the paperwork in order from day one.