Computer Software: Copyright and Contract of Employment in Nigeria

Introduction In an effort to keep pace with the rapid growth in the use of technology in our time, companies, organisations and government institutions are increasingly hiring the services of computer software developers so as to develop software that would enable them to smoothly operate their businesses. This is done in keeping with the disruptions which technology brings in almost every phase of human endeavour. However, while these developers are busy developing software for their employers, there are also growing concerns as to who is entitled copyright over the software which has been created. Computer software is a program which enables a computer to perform a specific function. The functionality of computer hardware is determined software in that computer. The need for ownership of copyright of computer software arises here because, the Nigerian Copyright Act (“the Act”) recognises computer software as a copyrightable work. Therefore, where one seeks to protect his software, he can validly do so under the Act. It is, however, pertinent to determine who has copyright over software created in the course of performing one’s duty as an employee. What is Copyright? In its simplest meaning, copyright is the right granted to an author of a literary work. This work may be a textbook, article, song, artistic drawing, architectural drawing, broadcast, sound, movie, novel etc., and the benefit of the right so granted is that the copyright author has absolute right over the copyrighted work, which allows him to deal with the work in any legitimate way he desires. This may include: performing the work publically (where it is performable), licensing it, leasing it, selling it or using it to obtain a loan and testamentary disposition of same. Where someone else does any of the above acts without the prior consent of the copyright owner, such act would amount to “copyright infringement,” and the copyright owner has a remedy against the infringer. However, it is not mandatory to obtain copyright over an authored work, but it is advisable to obtain such copyright protection because there are privileges a copyright owner would be entitled to enjoy which would not be available to the one who has refused to obtain copyright protection for the created work. Contract of Employment The Labour Act interprets a contract of employment to mean any agreement, whether oral or written, expressed or implied, whereby one person agrees to employ another as a worker and that other person agrees to serve the employer as a worker. A contract of employment is a legal term denoting the relationship that exists between an owner of work (in other words, “employer”) and a worker (in other words, “employee”). Put simply, in a contract of employment, an owner of work is the employer and the supplier of work/service is called an “employee.” A contract of employment is also interchanged with “contract of service.” It is, however, distinguishable from “contract for services”. It is necessary to distinguish between these two terms as they denote different things. It is a given that I have explained what contract of service means when I explained the concept of contract of employment, however, contract for services denotes a contractual relationship existing between an independent contractor and owner of work. An independent contractor is a self-employed professional who has been engaged by an owner of a business to perform a particular task within a defined period of time. The terms of contract that apply to contract of service do not apply to contract for services. And the reason is that an independent contractor is not an employee of an employer of labour and therefore, should not be placed in the same pedestal with an employee. A contract for services does not contain terms such as “terms of employment,” “employment benefits,” “employee’s responsibilities,” “employment opportunities and limitations” etc. Is a Software Developer a Professional? It is necessary to explain this point so as to have a correct perspective about this discourse. The question of whether a software developer is a professional might seem rather illogical. However, since in explaining who an independent contractor is, I did explain that he is a self-employed professional who has been engaged by an owner of a business to perform a defined task, it is important to establish whether a software developer is a professional. A professional is one who is engaged in a means of livelihood which he learned through a special training.  It is unarguable that learning how to code and develop software requires a specialised training in the field of science, either through a formal or informal education. It is not what someone will wake one morning and start doing. Therefore, it can be said that a software developer is a professional. However, it is not every software developer that would be self-employed. As a matter of fact, several of them are in the employment of both public and private institutions and, therefore, it becomes necessary that we determine what the law says about people like that. What the Act Says Section 9(2) of the Copyright Act, CAP C28 LFN, 2004 provides thus: Notwithstanding subsection (6) of Section 10 of this Act where a work-

1. Is commissioned by a person who is not the author’s employer under a contract of service of service of apprenticeship; or
2. Not having been so commissioned, is made in the course of the author’s employment

The copyright shall belong in the first instance to the author, unless otherwise stipulated in writing under contract. Section 10(6) of the Act applies to co-ownership of copyright, therefore it is inapplicable to the subject matter of this article. Who Owns the Copyright? From the wordings of the provisions of this Act, we can deduce that, when the Act said, “in the first instance,” it meant with respect to paragraph (a) of this section, that except the contract otherwise provides, the copyright shall be vest in the author of the work. What this means is that the parties can agree otherwise. Remember it is not a contract of service, therefore, it is a contract for services. This usually happens where a company outsources for a particular skill so as to increase its productivity and minimise cost. In that way, the companies engage independent contractors to handle that task. Where the independent contractor authors a copyrightable work, he would be entitled to the copyright over the work, but that is where there is no contrary provision in the terms of the contract. On the contrary, the parties can agree that any work which is authored in the course of performing the contract would be owned by the owner of the work. Where this is the position, the independent contractor would not have the copyright over the work he (the independent contractor) authored. Therefore, the terms of the contract determine who would claim copyright ownership of the work. It is clear from the above provisions that the Act is silent on who is entitled to copyright where it is a contract of employment strictly speaking. However, since we deduced that “in the first instance” referred to paragraph (a) of Section 9(6), we can further infer from paragraph (b) of Section 9(6). Paragraph (b) provides: “not having been so commissioned, is made in the course of the author’s employment.” In other words, where a work is made in the course of the author’s employment, the copyright shall belong (in the second instance) to the employer of the author. Well, this is exactly what this section provides. It does not matter if the work (in this a software) was created out of the scope of employment of the employee. Where he creates a work during his employment in an establishment, the employer is entitled to the copyright of the work. This is similar to the provisions of the United States Copyright Act, 1976. In the U.S Copyright Act, an employer is entitled to the copyright of a work created by his employee in the course of his employment. This is known as the doctrine of “work made for hire.” There is a judicial interpretation of this provision of the U.S Copyright Act. A locus classicus case is the popular case of AVTEC SYSTEMS, INC. v. PEIFFER 21 F. 3d 568 (4^th Cir. 1994). In this case, Avtec sued Peiffer for misappropriation of trade of secret. Peiffer was a former employee of Avtec Systems, Inc. who hired him to write a computer programme involving satellite orbit. He, however came up with an idea to write another program, which he wrote into a beta version (.309 version). He later worked from home, in his own time, and upgraded the version of the program into 2.05 version. He secretly sold the upgraded 2.05 version to his employer’s competitor who also sold same to its clients and Peiffer made good money from it. Upon discovering what happened, Avtec hastily registered the .309 version and sued Peiffer for misappropriation of trade secret. Peiffer counterclaimed for copyright infringement. Avtec contended that since 2.05 version was written by Peiffer while in its employment, that, it was a work made for hire, and therefore, Avtec owned it. On his part, Peiffer argued that 2.05 version was not written within the scope of his employment and therefore, that it was not a work made for hire. The trial court entered judgement for the parties according to their claims. However, on appeal, the appellate court reversed the decision of the trial court. The court referred to the case of Community for Creative Non-violence v. Reid where a U.S court posited that there were a number of factors to consider in determining if someone was an employee. According to the court: (1) it is of the kind that the he is employed to perform (2) it occurs substantial with the authorised time and space limits, and (3) it is actuated at least in part, by a purpose to serve the master. The court found that the program “was work of the type for which Peiffer was hired,” but that Peiffer “created the program outside the time and space constraints of his employer,” and was not “motivated by a purpose to serve Avtec,” and gave judgment for Peiffer. What is deductible from the position of the U.S court is that these factors are cumulative. While one factor may work to favour either of the parties, a holistic consideration of the three factors may present otherwise. Therefore, from the decision of the Fourth Circuit Court of Appeal of the United States of America, the applicability of the provisions of the U.S Copyright Act would depend on the circumstances of the case. Therefore, it would be safe to say that for the doctrine of “work made for hire” in the U.S to apply, it would have to pass through some tests. However, that is not the case in Nigeria. In strict adherence to the provisions of the of the Act, a computer software created (or authored) in the course of an employment belongs to the employer (whether or not the program was created in furtherance of performing a contract, occurs within the space of time of performing the task or actuated by the purpose of serving the employee’s master). This is further strengthened by Section 2(4) of the Patents and Designs Act, which provides that where an employee makes an invention in the course of employment or in the execution of a contract for the performance of specified work, the right to a patent in the invention is vested in the employer or, as the case may be, in the person who commissioned the work. We can safely deduce the mischief which the lawmakers intend to cure with respect to intellectual property from this unambiguous provision of Section 2(4) of the Patents Designs Act. Conclusion From the forgoing, we have been to establish, in line with the provisions of the Act, that copyright over a work authored by an employee, in the course of his employment, belongs to his employer. However, it is not known if cases touching on ownership of copyright over computer software has been decided by any of the Nigerian courts so as to know the perspective of the court with respect to this subject matter. But we would not hesitate to suggest that matters relating to ownership of copyright over a work created in the course of a person’s employment should be determined along the lines of these three principles which has been postulated by the Fourth Circuit Court of Appeal of the United States of America. Furthermore, we advise that where the parties would think otherwise, it should be explicitly stated in the terms of contract of the parties. Having done this, the parties would have taken care of any misgivings capable of arising in a contractual relationship. Reuben Chinweolu Okafor is an associate in the law firm of Udochi Iheanacho Partnership, a full service commercial law firm based in Lagos. chinweolureubenokafor@gmail.com]]>