Employment · Template

Employee confidentiality and IP assignment agreement — India

There is a gap between what most founders believe about employee IP and what the law provides. Copyright in work made in the course of employment does vest in the employer. A patentable invention does not — it stays with the inventor until it is assigned. One document closes both gaps, and it has to be signed before the work is done rather than after it turns out to be valuable.

Quick Statutory Answer

Doesn’t everything my employee makes automatically belong to the company? Partly. Copyright in a work made in the course of employment under a contract of service vests in the employer under s. 17 of the Copyright Act, 1957. Inventions are different: a patent application is made by the true and first inventor or their assignee, so without an assignment the employer has no filing right. The two regimes are not the same and only one of them is automatic.

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Employee Confidentiality & IP Assignment format

The full text of this document as VidhiSar drafts it, with every blank shown in square brackets. Copy it or download it as a Word file and fill it in yourself — or answer a few questions and VidhiSar fills it in and prints a formatted PDF. Clauses that apply only in some cases are left out here; the drafting flow adds them when your answers call for them.

PARTIES

This Confidentiality and Intellectual Property Assignment Agreement ("Agreement") is made on [Agreement Date] between [Company Legal Name], having its registered office at [Company Registered Address] ("Company"), and [Employee's Full Name], residing at [Employee's Residential Address], bearing PAN [Employee's PAN] ("Employee"), presently engaged as [Designation] with effect from [Date of Joining].

RECITALS

WHEREAS the Employee, in the course of employment, will have access to confidential information of the Company and its clients, and will create work in which intellectual property subsists;

AND WHEREAS the Company relies on the confidentiality of that information and on holding clear title to that intellectual property;

NOW THEREFORE the parties agree as follows:

TERMS AND CONDITIONS

1. Confidential Information. "Confidential Information" means all non-public information of the Company or its clients in any form, including source code, algorithms, product roadmaps, customer and supplier lists, pricing, commercial terms, financial data, business plans, personal data held by the Company, and any information marked confidential or which a reasonable person would understand to be confidential.

2. Obligation of Confidence. The Employee shall not, during employment or at any time after it ends, disclose Confidential Information to any person, or use it for any purpose other than performing their duties for the Company. This obligation continues for [Confidentiality Survival Period] years after the cessation of employment, and continues indefinitely in respect of trade secrets and personal data.

3. Exclusions. Clause 2 does not apply to information that is or becomes public otherwise than through the Employee's act or omission, that the Employee lawfully held before joining the Company, or whose disclosure is required by law, by a court, or by a regulator — provided that the Employee gives the Company prompt written notice where lawfully permitted to do so.

4. Assignment of Intellectual Property. The Employee assigns to the Company, absolutely and for the full term of the rights concerned including all renewals and extensions, all present and future intellectual property rights in any work, invention, design, software, database, process, mark or material created by the Employee in the course of employment or using the Company's resources or Confidential Information. Where such rights do not vest in the Company automatically, this clause operates as a present assignment of future rights.

5. Inventions Requiring Registration. The parties record that an employer does not become the applicant for a patent merely by reason of the employment relationship, and that title must be derived from an assignment. The Employee shall therefore promptly disclose every invention falling within Clause 4, shall not file any application in respect of it in their own name, and shall execute all documents and do all things reasonably required to enable the Company to apply for, prosecute, obtain and enforce registered rights under the Patents Act, 1970, the Designs Act, 2000 and the Trade Marks Act, 1999, whether during employment or after it ends.

6. Moral Rights. The Employee acknowledges that the special rights of an author under Section 57 of the Copyright Act, 1957 are personal and are not assigned by this Agreement, and agrees not to exercise them in a manner that obstructs the Company's ordinary commercial use, modification and distribution of the work.

7. Pre-Existing and Third-Party Rights. The Employee shall not incorporate into any work for the Company any material in which a third party, a previous employer, or the Employee personally holds rights, unless the Employee has disclosed it in writing and secured for the Company a licence sufficient for the Company's intended use. The Employee warrants that entering into this Agreement does not breach any obligation owed to a previous employer.

8. Company Property and Data. All records, devices, credentials and data in the Employee's possession belong to the Company. On the cessation of employment, or earlier on request, the Employee shall return or irretrievably delete all such material and shall confirm having done so in writing.

9. No Restraint on Future Employment. Nothing in this Agreement restrains the Employee from exercising a lawful profession, trade or business after the cessation of employment. The parties record that under Section 27 of the Indian Contract Act, 1872 an agreement in restraint of trade is void to that extent, and that this Agreement protects information and intellectual property, not the Employee's right to work.

10. Remedies. The Employee acknowledges that a breach of Clause 2 or Clause 4 may cause the Company harm that damages alone cannot remedy, and that the Company may seek injunctive relief under the Specific Relief Act, 1963 in addition to any other remedy.

11. Governing Law and Jurisdiction. This Agreement is governed by the laws of India, and the courts at [Courts Having Jurisdiction] shall have jurisdiction.

EXECUTION

The parties have executed this Agreement on the date first written above. This Agreement is supplementary to, and shall be read together with, the Employee's contract of employment.

Employee Confidentiality & IP Assignment format (India): page one of the document, with each blank to fill in shown in brackets

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What this document must contain (Clause-by-Clause Matrix)

Employee Confidentiality & IP Assignment — Mandatory Clause Matrix & Statutory Protection (2026)
Essential Clause	Legal Purpose & Protection	Governing Law / Benchmark
A definition of confidential information that names your actual categories	Source code, customer lists, pricing, unreleased roadmap, financials, personal data you hold. A definition drafted so broadly that it covers public facts is easier to attack than one drawn narrowly around what you really need protected.	Copyright Act, 1957 — s. 17
A present assignment of future rights	You cannot assign in the ordinary way something that does not exist yet. The clause has to operate as a present assignment of rights arising in the future, or all you hold is a promise to assign — a contractual claim rather than title.	Patents Act, 1970
A further-assurance obligation that survives the exit	Patent prosecution needs the inventor’s signature on forms, sometimes years later. Without an obligation that outlives employment, a departed employee’s signature becomes a negotiation at the worst possible moment.	Copyright Act, 1957 — s. 57
An express duty to disclose inventions	An assignment reaches only what you know about. Without a disclosure obligation, the employee decides what the company hears about.	Indian Contract Act, 1872 — s. 27
A moral rights acknowledgement	The author’s special rights under the Copyright Act are personal and are not transferred by an assignment. The workable answer is an acknowledgement plus a covenant not to exercise them so as to obstruct ordinary commercial use and modification.	Copyright Act, 1957 — s. 17
A prior-obligations and third-party materials warranty	The employee confirms they are not breaching an obligation to a previous employer and will not bring in code or material somebody else owns. This is what stops you inheriting a dispute that was never yours.	Patents Act, 1970
A confidentiality survival period, and no restraint on future employment	State how long confidentiality runs after exit, and say plainly that nothing here restrains the person from working. A document that protects information reads very differently from one that tries to lock up a career.	Copyright Act, 1957 — s. 57

A definition of confidential information that names your actual categories — Source code, customer lists, pricing, unreleased roadmap, financials, personal data you hold. A definition drafted so broadly that it covers public facts is easier to attack than one drawn narrowly around what you really need protected.
A present assignment of future rights — You cannot assign in the ordinary way something that does not exist yet. The clause has to operate as a present assignment of rights arising in the future, or all you hold is a promise to assign — a contractual claim rather than title.
A further-assurance obligation that survives the exit — Patent prosecution needs the inventor’s signature on forms, sometimes years later. Without an obligation that outlives employment, a departed employee’s signature becomes a negotiation at the worst possible moment.
An express duty to disclose inventions — An assignment reaches only what you know about. Without a disclosure obligation, the employee decides what the company hears about.
A moral rights acknowledgement — The author’s special rights under the Copyright Act are personal and are not transferred by an assignment. The workable answer is an acknowledgement plus a covenant not to exercise them so as to obstruct ordinary commercial use and modification.
A prior-obligations and third-party materials warranty — The employee confirms they are not breaching an obligation to a previous employer and will not bring in code or material somebody else owns. This is what stops you inheriting a dispute that was never yours.
A confidentiality survival period, and no restraint on future employment — State how long confidentiality runs after exit, and say plainly that nothing here restrains the person from working. A document that protects information reads very differently from one that tries to lock up a career.

When you need this

Before an engineer, designer or writer starts on anything the business intends to own
When an employee is working on something patentable, or on anything a diligence team will ask about
When an investor or acquirer asks you to show a clean chain of title over the product
When someone has been working for months on a handshake and there is nothing on record
When a new joiner has come from a competitor and their prior obligations need to be declared before they start

The law that governs it

Copyright Act, 1957 — s. 17 — In the absence of an agreement to the contrary, the employer is the first owner of copyright in a work made in the course of the author’s employment under a contract of service. That is the reassuring half of the position — and it reaches copyright only, not inventions, and turns on the engagement being a contract of service rather than for services.
Patents Act, 1970 — An application for a patent is made by the true and first inventor or by their assignee. The employment relationship does not by itself make the employer the inventor, so title must come from an assignment. An employment contract silent on inventions can leave a company without the right to file on its own product.
Copyright Act, 1957 — s. 57 — The author retains special rights — to claim authorship and to restrain distortion or mutilation prejudicial to their honour or reputation — independently of any assignment of copyright. These cannot simply be bought out, which is why the clause manages their exercise rather than pretending to transfer them.
Indian Contract Act, 1872 — s. 27 — Confidentiality and assignment obligations are not restraints of trade and survive the employment. A non-compete bolted onto the same document is void to the extent it restrains lawful work, and its presence weakens the credibility of the clauses that would have been enforced.

Common mistakes

Assuming the employment relationship transfers everything, and discovering in diligence that a core patent sits with someone who left two years ago
Getting the assignment signed after the invention exists, and after the employee has worked out what it is worth
Wording it as an agreement to assign at some future point, which leaves you holding a claim instead of a right
Bolting a two-year non-compete onto the confidentiality clause and putting the credibility of the whole document at risk
Never asking a new joiner what they owe a previous employer, and importing that problem along with them

Frequently asked questions

Doesn’t everything my employee makes automatically belong to the company?

Partly. Copyright in a work made in the course of employment under a contract of service vests in the employer under s. 17 of the Copyright Act, 1957. Inventions are different: a patent application is made by the true and first inventor or their assignee, so without an assignment the employer has no filing right. The two regimes are not the same and only one of them is automatic.

Do I need a separate IP agreement if the employment contract already has an IP clause?

Not strictly, provided the clause does the actual work — a present assignment of future rights, a disclosure duty, a further-assurance obligation that survives exit, and the moral rights position. A separate deed is common because it is easier to produce in diligence and easier to keep identical across a whole team.

Can I take the moral rights as well?

No. The special rights under s. 57 of the Copyright Act, 1957 are personal to the author and are not extinguished by an assignment of copyright. What you can do is record an acknowledgement and a covenant not to exercise them in a way that obstructs the company’s ordinary commercial use of the work.

Does this cover contractors and interns too?

No — and that is exactly the trap. The first-ownership rule in s. 17 follows a contract of service. A freelancer works under a contract for services and keeps copyright unless it is assigned in writing, and an intern’s status is ambiguous enough that you should never rely on inference. Use the freelance agreement and the internship agreement for those engagements.

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