A Challenge to IT Companies

Dear Reader,
[Note: This blog post should in no way reflect poorly on my current employer. I love my job and am not talking about any one company in particular but about IT companies in general.]

The Problem

Something has been bugging me for a while now. I’ve been a member of more IT companies than I care to remember. Outside of cube farms, one thing seems to remain constant throughout, a contract that was written in the 1800s. Most (not all) of the employment contracts I have been handed to sign have contained a clause that states something to the effect:

While you are working for us, if you invent something we like, we can claim ownership of it.

Each time I’ve had to negotiate that clause down to something a little less draconian. As my career has advanced and I’ve had more influence during the negotiations, I’ve been able to negotiate it down to something similar to:

While I work for you, if you ask me to create something, you own it. However, if I think it up on my own, and create it on my own time, I own it.

Even so, I am always nervous when I come up with a new idea until I have clearance to pursue it.

I am at that level of my career where I bring more skills to a job than I am going to take from them. At this point in my career it is much more likely that I will, during my own time, come up with an idea that has potential, but the current thinking is that unless I am diligent when reviewing employment contracts, the company feels it is entitled to that idea.

The Solution

The solution is simple, companies should stop thinking wrong-headed. Actually, if it were that simple, others would have already have implemented it. No, the rights of the company do have to be recognized. In many situations, the company invests in the developers/workers and that investment allows them the expanded knowledge to help fabricate ideas. Even if the investment is as simple as sending a developer to a conference, the conversations that happen at a conference could spark an idea. The company shouldn’t be cut out of the loop.

To balance the rights of the employee with the rights of the company I suggest this.

As long as you work for us, we have first right of refusal on funding any idea you come up with, regardless of its origin. If we decide to fund the idea, a corporate structure will be setup that will allow you partial ownership in the resulting entity. If we decide not to fund the idea, we give you our blessing to pursue the idea as long as it does not interfere with your current job.

In this case, if the idea has value, the company can participate in the idea and the employee is rewarded for their initiative with partial ownership. This also helps with employee retention, after all, the people coming up with good ideas are the ones that you want to keep!

The Challenge

Here is where the fun comes in. I challenge every CEO of a tech company reading this blog post to review your employment contract that you force employees to sign. Is there a clause in there like this? If you were offered a job with that clause, would you be happy about signing it? If not, I challenge you to implement this participation clause in not only future employment contracts but offer it up to all existing employees.

Until next time,
(l)(k)(bunny)
=C=

Tags: developers, Entrepreneurship, Management

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