California Labor Laws And Work Made For Hire Agreements

Question from a reader about California labor code and an answer from Carolyn and Leslie at the Photo Attorney.

Q. I’m sorry to bother you but I have a question that has not been addressed on any professional photography or photography related website that I can find. In CA the labor code makes work for hire when transferring the ownership of copyright illegal (civil and criminal liability) except in the case of an employer/employee relationship. How does this apply to photographers working in CA when doing small jobs? Is it legal to have work around language that assigns copyright to the person doing the hiring (meaning the agreement says everything a work for hire agreement would say but it doesn’t use the term work for hire); or is it a case of walks like and duck, quacks like a duck, it is a work for hire agreement and therefor illegal in the state of CA?

A. Thank you for this important question.  The issue is not that it’s illegal for an independent contractor to agree to a work made for hire agreement in California.  The problem is that when a photographer is hired under a work made for hire agreement, then the photographer, under California state law, is considered an employee rather than a independent contractor.   Specifically, California Labor Code section 3351.5(c)provides that one definition of an “Employee” is:

Any person while engaged by contract for the creation of a specially ordered or  commissioned work of authorship in which the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire, as defined in Section 101 of Title 17 of the United States Code, and the ordering or commissioning party obtains ownership of all the rights comprised in the copyright in the work.

California Unemployment Insurance Code Section 686 also states that:

“Employer” also means any person contracting for the creation of a specially ordered or commissioned work of authorship when the parties expressly agree in a written instrument  signed by them that the work shall be considered a work made for hire, as defined in Section 101 of Title 17 of the United States Code, and the ordering or commissioning party obtains ownership of all of the rights comprised in the copyright in the work. The ordering or  commissioning party shall be the employer of the author of the work for the purposes of this part.

Once the photographer is an employee, the employer must pay unemployment and worker’s compensation insurance for the employee.  If not, the employer can be subject to one year in jail and up to $20,000 in fines (California Labor Code section 3700.5 and California Unemployment Insurance Code Section 2122).

But there is another way.

If the photographer is operating through a business entity (such as an LLC or corporation), then the Labor and Unemployment Codes don’t apply.  If the photographer is an individual/sole proprietor, then don’t use “Work Made for Hire” language in the Agreement.  Instead, you may assign the copyrights to another through language such as:

Photographer irrevocably transfers and assigns to the Client the copyrights created as part of the project.

Of course, if a photographer agrees to transfer copyrights, hopefully it will be for an appropriately large sum.  And when a photographer hires someone (like a designer) and wants ownership of the material created, also be careful not to violate these laws.  All of this is part of knowing your rights and responsibilities as a professional photographer!

Carolyn E. Wright and Leslie Burns, Law Office of Carolyn E. Wright, LLC (a/k/a the Photo Attorney)

 

There Are 3 Comments On This Article.

  1. Does this apply to an employee who lives in California, or the employer who is hiring? Do they both have to be based in California for this to apply, or just one party?

  2. c.d.embrey

    I went through this back in the 1970s while working in TV commercial production. The producers didn’t want anything to do with unemployment insurance, workers comp insurance or the withholding of both payroll taxes and income taxes.

    The IRS came after anyone who worked for one of these producers, even if you had paid the parole and income taxes.

    BTW it is normal for motion picture/video to be work-for-hire. The producer holds the copyright, not the director or the photographer. This could turn into an interesting can-of-worms 8-)