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The copyright in a design is sometimes owned by the person who paid for it rather than by the artist who created it. When this occurs, the resulting work is known as a work made for hire. When you employ someone to design, you will always own the resulting designs. But if you hire a contractor (not an employee) to design something — whether a crafts item or a logo — the contractor, not you, may end up owning the right to reproduce it. To avoid that result, the work made for hire agreement is used.
Read more about works made for hire.
Explanation of Work Made for Hire Agreement
For a detailed explanation of the provisions in the work made for hire, see below.
In the “Services” section, describe the work that the contractor is to perform, for example, “Create a series of Gothic fabric designs.”
Insert the amount to be paid to contractor in the “Payment” section.
The section titled “Works Made for Hire—Assignment of Intellectual Property Rights” establishes that the work is made for hire. However, if the work does not meet the requirements of a work made for hire under copyright law, a backup provision is added that converts the arrangement to an assignment. An assignment is a transaction in which a copyright is permanently transferred. Assuming you execute the assignment prior to the performance by the independent contractor, the payment to the independent contractor is sufficient compensation for the copyright. Sometimes, in return for the transfer, the independent contractor might also either get a lump sum or a continuing payment known as a royalty. This type of provision is commonly used by businesses seeking to make sure that ownership rights have been acquired.
The “Warranty” provision provides an assurance that the Contractor owns the work and that the work is not an infringement. This is necessary to provide an assurance that the work is not taken from another source.
This agreement includes some miscellaneous provisions (“Entire Agreement,” “No Joint Venture” and so on). Here is an explanation of these provisions.