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01 February 2017

Slovakia: Managers are Creative Too – The New Copyright Act

The new regulation of copyright work created by employees provides a flexible system more suitable for new tech industries and start-ups in Slovakia.

The New Copyright Act in Slovakia

In today’s economy, the value of intellectual property created by employees is increasing, mainly due to the rising importance of new tech, start-ups and creative industries, such as TV and media. In these fields, it is natural for employers and owners to use such intellectual property to further develop their business and therefore to try to protect it as much as possible.

The former regulation of copyright works created by employees in place in Slovakia had its limits and did not reflect rapid economic development and emerging industries. As of 2016, the new Act No. 1852015 Coll., on Copyright, as amended (the “New Act”) provides for more flexible protection of employee works and options when exercising rights arising from such works.

Extended scope of protection

The biggest change under the New Act is to the scope of employee works. Under the former legislation, the regulation applicable to employee works only covered works created by an employee in the course of performing his or her duties within an employment or civil service relationship.

Under the New Act, the specific regulation also applies to:

  • employees who are only temporarily assigned to a so-called “user employer”;
  • members of the managing, controlling or supervisory bodies and statutory representatives (such as managing directors) of legal entities in connection with the performance of their duties associated with this office.

The extension of the scope of employee works to works created by managers is a novelty in Slovak law. Since managers usually perform work on the basis of contracts of employment, they were already covered by the former legislation. However, quite a few managers work under other types of contracts, eg cooperation agreements, or (mainly in the case of statutory representatives) even without a specific contract. Thus, compared to the former regulation that covered only works created by employees, the New Act will potentially cover more intellectual property.

Nevertheless, some problems in the application of the new regulation can already be foreseen. As the New Act does not precisely define which bodies should be deemed man-aging, controlling or supervisory bodies, there is room for potential future disputes. For instance, a manager (not working under a contract of employment) could claim that his position in a specific body (eg the R&D committee of a company) cannot be considered as a position in a managing, controlling or supervisory body.

A similar situation might arise with respect to a managing director performing his or her function without a written agreement, which is common in Slovakia. As Slovak commercial law stipulates the duties of managing directors only in general terms, it could be easily disputed whether certain work created by a managing director was in fact created in connection with his or her duties.

More flexible assignment of employee works and specific licence

The former regulation led to practical problems in the assignment of economic rights arising from employee works from the employer to a third party, mainly as a result of the employer’s obligation to obtain the employee’s consent to such assignment.

Under the New Act, an employer-oriented solution has been introduced. Now the employer may assign intellectual property rights from employee works to a third party without the author’s consent, unless agreed otherwise. Therefore, no consent of the author (employee or manager) is required unless specifically agreed.

On other hand, an employee who has authored a work now has the right to request from his or her employer a licence to use it under standard conditions if the employer exercises economic rights from the work poorly or does not exercise them at all. The employer, however, is entitled to refuse to grant such a licence if doing so would be contrary to its legitimate interests or if another serious reason exists.

Potential impact

The main practical impact of the new regulation of employee works is its extension to managers. This is important mainly in companies where managers can potentially create a copyright work, such as start-ups, where the managing directors themselves usually create the company’s product. In order to avoid future disputes, the potential aspects of employee works should be covered in every agreement concluded with a manager.

The New Act introduces a very employer-oriented solution. Now the employer may assign intellectual property rights from employee works to a third party without the author's consent.

authors: Michal Lučivjanský, Peter Devínsky