Calculating the remuneration of employees (Germany)
The majority of all inventions are made in companies or at universities. In Germany, these inventions are automatically so-called employee inventions and are subject to the German Employees’ Invention Act (ArbnErfG) - a complex issue.
Introduction to Employees’ Inventions (Germany)
In principle, every employee working in Germany who conceives an invention is obliged by the German ArbnErfG to disclose it immediately in writing to the employer, indicating that it constitutes an Employees’ Invention. The employer, in turn, is obliged under ArbnErfG to respond to this invention disclosure; in doing so, he has several options. If the employer claims the invention in an unrestricted manner, then, according to the German law, all rights to the invention are transferred to the employer and, in return, the employer is obliged to pay the inventor remuneration.
In practice, this inventor remuneration is a sensitive and complex issue for both the inventor and the employer, and one with potential for conflict. The so-called license analogy has become established under the ArbnErfG as an approximation to the question of how high an appropriate remuneration should be, a not always straightforward calculation of the inventor remuneration for an Employees’ Invention.
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The calculation of an employee inventor’s remuneration according to the German Employees’ Inventions Act using the license analogy takes into account certain key parameters, which concern, among other things, the share of the respective inventor in the invention, the experience and know-how of the inventor and also his position in the company as well as the economic potential of this invention. Even this small excerpt from the parameters that have to be considered while calculating this remuneration makes clear: the right questions must be asked to compile these parameters, and this is often not so easy for the parties involved.
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