# Employee Invention-Assignment Agreements: What State Law Lets an Employer Require, and What It Carves Out[^about] The cross-state framework for employee invention-assignment agreements — the own-time invention carve-out, default ownership of what an employee invents, the written-notice requirement, and limits on post-employment holdover clauses — with California's Labor Code Sections 2870–2872 as the worked example and links to the 50-state survey. An invention-assignment agreement is the promise an employer asks a worker to make about who owns what the worker invents: the employee agrees to assign their rights in covered inventions to the employer. How far that promise can reach is not a single national rule — it turns on the law of the governing state — but the same four questions decide the outcome almost everywhere. First, does the state impose a statutory **own-time carve-out** that takes certain personal inventions outside the assignment no matter how the clause is drafted? Second, who owns an invention by default, before any assignment? Third, must the employer give the employee written **notice** of the carve-out? And fourth, how far can a post-employment **holdover** clause reach into inventions conceived after the job ends? This note explains that shared spine and uses **California** as the worked example, because California codifies the own-time carve-out, default ownership, and notice rules in Labor Code sections 2870–2872 — its limit on post-employment holdover clauses comes separately from the restraint-of-trade bar in Business and Professions Code section 16600 — and is the model that roughly ten other states have followed. Most states reach comparable results through contract and common law rather than a statute. For the jurisdiction-specific detail, see the [50-state survey](/surveys/invention-assignment/us); for the fully sourced California analysis, see the [California practice note](/practice-guides/invention-assignment/us/california). ## What inventions can an employer require an employee to assign? {#what-can-be-assigned} **Short answer.** Not every invention. The California archetype, Labor Code section 2870(a), carves out a category of inventions that an assignment clause cannot reach: anything the employee developed entirely on their own time, without the employer's equipment, supplies, facilities, or trade-secret information, that neither relates to the employer's business or anticipated research and development nor results from the employee's work. California and roughly nine other states codify this **own-time carve-out**; most states reach a broadly similar line through contract and common law rather than a statute. Where the statute applies, a clause that purports to capture those own-time inventions is void to that extent [^ia-2870-carveout]. The carve-out operates as a ceiling on what an assignment promise can do, not a matter of drafting around. However broadly the contract is written, in a section 2870 state it does not reach an invention the employee made on their own time and with their own resources unless the invention relates to the employer's business or anticipated R&D, or results from the employee's work [^ia-2870-carveout]. "Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information except for those inventions that either: (1) Relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer; or (2) Result from any work performed by the employee for the employer."[^ia-2870-carveout] The exact contours of the carve-out — and whether it is statutory at all — vary by state, so the [50-state survey](/surveys/invention-assignment/us) records each jurisdiction's rule. What is uniform is the core idea: an invention an employee makes wholly on their own time and resources, unrelated to the employer's business and not flowing from their work, sits on the employee's side of the line. ## Who owns an invention by default, absent a written assignment? {#default-ownership} **Short answer.** The inventor. The background rule in U.S. patent law — restated by the Supreme Court in *Stanford v. Roche* — is that rights in an invention belong to the person who conceived it, which in the employment setting is the employee. An employer takes title only derivatively, through a written present-assignment from the employee; absent that grant, the invention stays with the inventor. Two narrow common-law overlays can give an employer rights without an express assignment, but neither substitutes for a written clause [^ia-stanford-inventor][^ia-stanford-traceback]. *Stanford v. Roche* anchors the default. The Court treated the inventor-ownership premise as the baseline against which any claimed assignment must be measured, holding that even a federal funding statute did not displace it [^ia-stanford-inventor]. "Since 1790, the patent law has operated on the premise that rights in an invention belong to the inventor."[^ia-stanford-inventor] Because ownership starts with the inventor, an employer's title is purely derivative: it exists only if and to the extent the employee assigned it, and any third party's interest must trace back to that inventor-grantor [^ia-stanford-traceback]. "Thus, although others may acquire an interest in an invention, any such interest — as a general rule — must trace back to the inventor."[^ia-stanford-traceback] The two common-law overlays narrow but do not erase this default. Under the *hired-to-invent* doctrine, an employer takes equitable title where the employee was engaged specifically to invent or to solve the particular problem the invention solves. The *shop right* gives an employer only a non-exclusive, royalty-free license — not ownership — where the employee used the employer's time, facilities, or materials. Both are fact-intensive and limited, which is why employers rely on a written present-assignment (*hereby assigns*) clause — present-tense language that transfers legal title automatically on conception, rather than a future promise to assign. The state-by-state default and the scope of these overlays are tracked in the [50-state survey](/surveys/invention-assignment/us). ## Must the employer give the employee written notice of the carve-out? {#notice-requirement} **Short answer.** In some statutory states, yes. California section 2872 requires an employer whose agreement contains an invention-assignment provision to give the employee, at the time the agreement is made, a written notification that the agreement does not apply to an invention qualifying fully under section 2870. The same statute then places the burden of proof on the employee who later claims the carve-out's protection. Whether a notice is required at all, and what it must say, varies by state — several section 2870 states impose a parallel duty, while non-statutory states impose none [^ia-2872-notice][^ia-2872-burden]. The notice obligation is contemporaneous: the written notification must accompany the agreement when it is made. It does not change which inventions are carved out — the carve-out statute does that — but it ensures the employee is told the carve-out exists [^ia-2872-notice]. "If an employment agreement entered into after January 1, 1980, contains a provision requiring the employee to assign or offer to assign any of his or her rights in any invention to his or her employer, the employer must also, at the time the agreement is made, provide a written notification to the employee that the agreement does not apply to an invention which qualifies fully under the provisions of Section 2870."[^ia-2872-notice] The allocation of proof cuts the other way. When a dispute arises, the employee who wants the benefit of the own-time carve-out must establish that the invention qualifies — the statute puts that burden on the employee, not the employer [^ia-2872-burden]. "In any suit or action arising thereunder, the burden of proof shall be on the employee claiming the benefits of its provisions."[^ia-2872-burden] Because both the notice duty and the burden allocation are creatures of each state's statute, they do not travel automatically across borders. The [50-state survey](/surveys/invention-assignment/us) records which jurisdictions require a written carve-out notice and how each allocates proof. ## How far can a post-employment holdover clause reach? {#holdover-limits} **Short answer.** Not into genuinely post-employment inventions, at least where state law treats the reach as a restraint of trade. A **holdover** (trailing-assignment) clause tries to capture inventions the employee conceives after the job ends. In California, the Federal Circuit held in *Whitewater West Industries v. Alleshouse* that such a provision is void under Business and Professions Code section 16600 — the same statute that voids employee non-competes — because forcing a former worker to hand over inventions made after they leave restrains them from practicing their profession. The own-time carve-out statute does not rescue an overbroad holdover; if anything, section 2870 marks the same public-policy limit [^ia-whitewater-void][^ia-whitewater-16600][^ia-2870-policy]. The former employee in *Whitewater* left, then invented and patented new technology without using any of his former employer's trade secrets. The court refused to enforce the trailing-assignment clause against him, holding the provision void under California law [^ia-whitewater-void]. "In particular, we reverse the judgment of breach of contract because we hold that the assignment provision is void under California law."[^ia-whitewater-void] The legal engine is section 16600. A clause that forces a worker to assign inventions made after they leave restrains them from engaging in their lawful profession and is void to that extent [^ia-whitewater-16600]. "First, California Business and Professions Code § 16600 states: ‘Except as provided in this chapter, every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.’"[^ia-whitewater-16600] The carve-out statute reinforces the same boundary from the other direction: a provision that purports to require assignment of an invention the statute excludes is not just unenforceable but declared against public policy [^ia-2870-policy]. "To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable."[^ia-2870-policy] How far a holdover clause can reach — and whether a state will void it, narrow it, or enforce a short post-employment tail tied to trade-secret use — is one of the sharpest points of state-to-state divergence. The [50-state survey](/surveys/invention-assignment/us) records each jurisdiction's limit. > [!NOTE] > **Practice note.** > > Do not reuse a single assign-everything invention-assignment form across states. A form built for a broad-assignment jurisdiction will often omit the written carve-out notice that statutory states such as California require at signing, sweep in own-time inventions that a section 2870-style carve-out takes off the table, and carry a post-employment *holdover* clause that *Whitewater* makes void under section 16600. Before relying on one form, confirm each state's own-time carve-out, notice rule, and holdover limit against the [50-state survey](/surveys/invention-assignment/us) [^ia-2872-notice][^ia-whitewater-void]. [^about]: By Steven Obiajulu, J.D. Published by [openagreements.org](https://openagreements.org). Last reviewed 2026-06-29. License: CC BY 4.0. Steven Obiajulu, J.D. edits this topic article for Federal + 50-state coverage. It synthesizes legal sources and is not legal advice. This article is for informational purposes only and does not create an attorney-client relationship. [^ia-2870-carveout]: **Cal. Lab. Code § 2870** — "Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information except for those inventions that either: (1) Relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer; or (2) Result from any work performed by the employee for the employer." *Cal. Lab. Code § 2870(a).* [^ia-stanford-inventor]: **Bd. of Trustees of the Leland Stanford Junior Univ. v. Roche Molecular Systems** — "Since 1790, the patent law has operated on the premise that rights in an invention belong to the inventor." *Bd. of Trustees of the Leland Stanford Junior Univ. v. Roche Molecular Sys., Inc., 563 U.S. 776 (2011).* [^ia-stanford-traceback]: **Bd. of Trustees of the Leland Stanford Junior Univ. v. Roche Molecular Systems** — "Thus, although others may acquire an interest in an invention, any such interest — as a general rule — must trace back to the inventor." *Bd. of Trustees of the Leland Stanford Junior Univ. v. Roche Molecular Sys., Inc., 563 U.S. 776 (2011).* [^ia-2872-notice]: **Cal. Lab. Code § 2872** — "If an employment agreement entered into after January 1, 1980, contains a provision requiring the employee to assign or offer to assign any of his or her rights in any invention to his or her employer, the employer must also, at the time the agreement is made, provide a written notification to the employee that the agreement does not apply to an invention which qualifies fully under the provisions of Section 2870." *Cal. Lab. Code § 2872.* [^ia-2872-burden]: **Cal. Lab. Code § 2872** — "In any suit or action arising thereunder, the burden of proof shall be on the employee claiming the benefits of its provisions." *Cal. Lab. Code § 2872.* [^ia-whitewater-void]: **Whitewater West Industries, Ltd. v. Alleshouse** — "In particular, we reverse the judgment of breach of contract because we hold that the assignment provision is void under California law." *Whitewater W. Indus., Ltd. v. Alleshouse, 981 F.3d 1045 (Fed. Cir. 2020).* [^ia-whitewater-16600]: **Whitewater West Industries, Ltd. v. Alleshouse** — "First, California Business and Professions Code § 16600 states: ‘Except as provided in this chapter, every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.’" *Whitewater W. Indus., Ltd. v. Alleshouse, 981 F.3d 1045 (Fed. Cir. 2020) (quoting Cal. Bus. & Prof. Code § 16600).* [^ia-2870-policy]: **Cal. Lab. Code § 2870** — "To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable." *Cal. Lab. Code § 2870(b).*