Who Owns IP Created by Employees or Contractors in Canada?

The default rule: whoever creates the work owns it

Canadian intellectual property law starts from one baseline, and every employer/contractor exception is a departure from it. For copyright, the Copyright Act says “the author of a work shall be the first owner of the copyright therein” (s.13(1)). Whoever actually wrote the code, drew the design, or drafted the document owns it, unless a specific statutory exception or a signed agreement says otherwise. This is federal law, so it applies the same way in Ontario, Alberta, and everywhere else in Canada.

The employee exception: employers own work made “in the course of employment”

The main exception flips ownership to the employer, but only under a narrow test. Under section 13(3) of the Copyright Act, where the author was employed “under a contract of service or apprenticeship” and the work was made “in the course of his employment,” the employer is automatically the first owner, “in the absence of any agreement to the contrary.” This is the closest Canadian equivalent to what’s often called “work made for hire” in the US, though the Canadian test turns specifically on whether the creator is a true employee, not a contractor, and whether the work was made within their job duties. Because the rule only kicks in “in the absence of any agreement to the contrary,” an employment contract can override it in either direction: it can confirm employer ownership explicitly, or assign rights back to the employee.

Independent contractors keep what they create

Because section 13(3) is worded to apply only to someone employed “under a contract of service,” it does not reach independent contractors. A business that hires a freelance designer, developer, or writer does not automatically own the copyright in the resulting work, no matter how much control it exercises over the assignment or how it’s paid. The contractor remains the first owner unless they sign a separate written assignment transferring the rights.

This gap shows up in Ontario case law on inventions, not just copyright. In Kohler Canada Co v Porter, the Ontario courts (discussing the earlier Court of Appeal decision in Techform Products Ltd v Wolda) confirmed that where the governing agreement said nothing about invention ownership, and the creator was found to be an independent contractor rather than an employee, the invention stayed with the contractor. The company had to go back and obtain a separate written assignment to secure the rights it assumed it already had.

Patents: there is no automatic employer-ownership rule

Unlike copyright, the federal Patent Act contains no general rule giving employers automatic ownership of inventions made by their employees or contractors. The only automatic-vesting rule in federal legislation is narrow and applies only to federal public servants: under the Public Servants Inventions Act, an invention made by a public servant “while acting within the scope of his duties or employment” vests in the Crown. For everyone else, private-sector employees and contractors alike, invention ownership depends entirely on the employment or service contract and on common-law principles a court would apply if the contract is silent, as in the Ontario case above. Neither this article nor the underlying source material found an Alberta appellate decision confirming the same result, but the federal statutory gap it illustrates (no automatic Patent Act rule) applies nationwide.

Trademarks: ownership follows use, not the idea

Trademark rights work on a different logic again. Under section 16(1) of the Trademarks Act, entitlement to register a trademark flows from use (or making it known) in Canada, ranked against competing uses by filing and use dates, not from who first thought of the name or logo. In practice, this means the business that actually puts a mark into commercial use is generally the party entitled to own and register it, even if an employee or contractor came up with the idea. That said, ownership disputes can still arise if a contractor registers a mark in their own name before the business does.

Moral rights don’t disappear when copyright is assigned or transferred

Even where a business does own the copyright, whether through the section 13(3) employee rule or through a signed assignment from a contractor, the creator’s moral rights are a separate layer. Under section 14.1(3) of the Copyright Act, “an assignment of copyright in a work does not by that act alone constitute a waiver of any moral rights.” Moral rights include the right to the integrity of the work and the right of attribution; they can be waived, but a waiver has to be addressed separately from the copyright transfer itself.

A worked example

A marketing firm in Alberta hires a graphic designer on a fixed-term employment contract to design client logos as part of their job. Because the designer is a true employee working “in the course of employment,” section 13(3) of the Copyright Act makes the firm the first owner of the copyright in those logos automatically, with no separate paperwork needed. The same firm also pays a freelance illustrator, an independent contractor, to design one campaign graphic. Because the illustrator is not employed under a contract of service, the firm does not own that graphic’s copyright by default; without a signed assignment, the illustrator remains the owner and the firm only has whatever licence, if any, was agreed to.

Common mistakes

• Assuming “we paid for it” means “we own it.” Payment alone does not transfer copyright; ownership turns on employment status and, for contractors, on a signed assignment.
• Treating contractors like employees for IP purposes. The section 13(3) employer-ownership rule does not apply to independent contractors no matter how integrated they are into the team.
• Skipping a written invention-assignment clause. Because the Patent Act has no default employer-ownership rule, silence in the contract can leave an invention with the person who made it, as the Ontario courts found in the Techform/Kohler line of cases.
• Assuming a copyright assignment covers moral rights too. It does not; moral rights survive an assignment unless separately waived under section 14.1(3).
• Registering a trademark based on who invented the name. Entitlement under section 16(1) turns on use in Canada, not on who came up with the idea.