Work made for hire
work for hire / who owns the code / source code ownership / copyright assignment
Work made for hire is the legal category that decides who owns something you paid to have made. Copyright starts with whoever created the work. For commissioned work it only becomes yours through one of two narrow routes in the statute, and software fits neither by default.
Most people assume that paying for something built to order means owning it. United States copyright law does not start there. The statute says copyright in a work vests initially in the author or authors of the work. The author is whoever created it, not whoever paid the invoice.
Work made for hire is the exception that changes who counts as the author, and the statute defines it narrowly. There are exactly two routes. The first is a work prepared by an employee within the scope of their employment. The second is a work specially ordered or commissioned, but only for use as one of nine listed things, and only if the parties expressly agree in a written instrument signed by them.
Those nine are worth reading slowly, because of what is missing. A contribution to a collective work, part of a motion picture or other audiovisual work, a translation, a supplementary work, a compilation, an instructional text, a test, answer material for a test, or an atlas. Software is not on that list. Neither is a website.
So calling a development contract a work made for hire does not, by itself, do what people expect when an outside developer wrote the code. Where the category does apply, the effect is total: the statute says the employer or other person for whom the work was prepared is considered the author.
The route that does work for commissioned software is a transfer, and the statute is strict about its form. A transfer of copyright ownership other than by operation of law is not valid unless an instrument of conveyance, or a note or memorandum of the transfer, is in writing and signed by the owner of the rights conveyed or an authorized agent. In writing, and signed.
This is what the statute says. It is not advice about your particular contract, and the wording that actually assigns rights is worth having a lawyer draft rather than copying from anywhere, including here.
In practice
A company pays a freelance developer for a booking system over eight months. There is a signed agreement covering scope, milestones and payment, and it never mentions copyright. The company owns the invoices. Under the statute the developer, as the author, holds the copyright, because no signed transfer exists and commissioned software is not one of the nine categories that can be a work made for hire.
Not the same as
- Owning your data
- The records inside the system are a separate question from who owns the code that runs it.
- Having the files
- Possessing a copy of the source code is not the same as holding the rights to it.
Why it matters to you
This surfaces at the worst moment: when you want to change supplier, sell the business, or have somebody else extend the system. It costs nothing to settle at the start and can be expensive to settle later, because by then the other party knows exactly what it is worth to you.
What to ask or check
- 01Does our agreement contain a written, signed assignment of copyright, not just the phrase work made for hire?
- 02If the developer was a contractor rather than an employee, who does the contract say owns the code?
- 03What happens to rights in anything built after the original agreement was signed?
What people get wrong
That paying for custom software makes you its owner, or that writing work made for hire into a contract settles it. The statute vests copyright in the author, and its commissioned route covers nine listed kinds of work that do not include software.
Red flags
- A development agreement that never mentions copyright at all.
- The phrase work made for hire used on its own as though it settled ownership of commissioned software.
- Rights discussed only after the relationship has soured, when the leverage has moved.
Who owns it
Whoever the statute treats as the author, unless there is a transfer in writing and signed. For an employee's work within the scope of employment that is the employer. For a commissioned developer it is the developer until rights are assigned.