New York Employee IP Assignment (NY Labor Law § 203-f) & Non-Compete Redline Auditor
New York enacted NY Labor Law § 203-f rendering unenforceable any employment provision requiring an employee to assign inventions developed entirely on their own time without using the employer’s equipment, supplies, facilities, or trade secrets. However, like California, § 203-f contains an exception for inventions that "relate to the employer’s business, or actual or demonstrably anticipated research or development"—which NYC finance, media, and tech employers draft to swallow everything you ever create, alongside unpaid "Garden Leave" notice periods.
Senior Engineer’s Weekend AI SaaS Side-Project Claimed by Employer During Series A Diligence
A staff engineer built an unrelated dev-tool on nights and weekends using his personal MacBook, then left to raise a Series A. Because his prior CIIAA swept in all inventions created "during the period of employment" and claimed it "related to Company’s anticipated R&D," the former employer blocked the VC round until paid $350,000.
RedlineCore™ enforces the statutory off-duty invention carve-out (CA Labor Code § 2870 / WA / IL / NY standards) and attaches an explicit Prior & Side-Project Invention Schedule.
Check Your Full Contract PDF for Cross-Section Overrides (Free 60s Scan)
Fixing one clause alone often fails when a buried definition, exhibit, or survival clause elsewhere in your Commercial Property & Business Loss neutralizes your protection. Drop your PDF or Word (.docx) below for an instant, 100% anonymous cross-section audit.
“NY Labor Law § 203-f Carve-Out & Paid Garden Leave: (a) Pursuant to New York Labor Law § 203-f, this assignment strictly excludes all inventions developed on Employee’s own time without Company equipment or trade secrets, and "Company’s business" is limited strictly to the specific team/product unit in which Employee directly works; (b)
What to Say to the Commercial Lines Carrier / E&S Insurer
"In line with New York Labor Law § 203-f, we need to delete the 1-year post-employment IP holdover clause, attach my Prior Inventions on Exhibit A, and confirm that any Garden Leave period includes 100% full salary and continued equity vesting."
Why they drafted it this way: NYC employers combine overbroad "anticipated business" definitions with a 12-month post-employment IP "trailer/holdover clause" to claim ownership of startups founded up to a year after you quit.
Mandatory Audit Checklist Points
- Invoke NY Labor Law § 203-f and narrow "Company’s business" to your specific business unit
- Delete post-termination "Holdover / Trailer" IP assignment clauses (claiming ideas conceived 6–12 months after quitting)
- Require 100% full base pay and continued equity vesting during any NYC Garden Leave period
- Ensure earned commissions and annual bonuses are not forfeited if terminated without Cause prior to payout date
Paste Your New York employee IP assignment Labor Law 203-f redline Section or Upload Your Full Commercial Property & Business Loss (.pdf / .docx)
Check if your draft has a hidden loophole or cross-section override. Click ⚡ Preview Sample Audit (Instant) to see a live demo in 0.2s, or upload your own PDF / Word (.docx) contract below:
Frequently Asked Questions
What does New York Labor Law § 203-f protect?
Enacted in 2023, NY Labor Law § 203-f makes any employment clause void as against public policy to the extent it forces an employee to assign inventions created entirely on their own time without using employer resources or trade secrets—unless it relates to the employer’s actual or demonstrably anticipated R&D.
What is a post-employment "IP Trailer" or "Holdover" clause?
It is a toxic clause stating that any patent, software, or business idea you conceive within 6 to 12 months *after* leaving the company is presumed to have been conceived while employed and belongs to your former employer. Always strike it.
How do I redline New York employee IP assignment Labor Law 203-f redline traps in my Commercial Property & Business Loss anonymously without creating an account?
Upload your Commercial Property & Business Loss PDF or Word (.docx) draft to ClaimXray.com to run the "New York Employee IP Assignment (NY Labor Law § 203-f) & Non-Compete Redline Auditor" defense cartridge 100% anonymously—with zero account registration, zero email login, and stateless in-memory processing. RedlineCore™ 4.0 flags New York employee IP assignment Labor Law 203-f redline exposure (typically $50,000 – $500,000+ in personal startup IP & unpaid NY Garden Leave; documented unredlined loss: $350,000 settlement share forfeiture to former employer), checks for cross-section overrides, and exports a ready-to-send Microsoft Word (.docx) Track-Changes file.
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Under Texas Business & Commerce Code § 15.50, a non-compete is enforceable if it is ancillary to an otherwise enforceable agreement (like providing confidential information or specialized training) and contains reasonable limits on time, geographic area, and scope of activity. Texas employers routinely draft 24-month nationwide non-competes that apply even if the company fires you without Cause after 90 days—and for physicians/healthcare practitioners, try to inflate the mandatory statutory buyout clause.
Washington State Employee Non-Compete (RCW 49.62) & IP Assignment (RCW 49.44.140) Redline
Washington State has some of the strongest statutory employee protections in the country under RCW 49.62 (recently strengthened by SB 5935) and RCW 49.44.140: (1) Non-competes are void unless total annualized compensation exceeds the inflation-adjusted statutory threshold (~$120,559+ for W-2 employees and ~$301,399+ for 1099 contractors), cannot exceed 18 months, and IF you are terminated via layoff, the non-compete is VOID unless the employer pays your full base salary during the entire restriction period! (2) Under RCW 49.44.140, employers must give written notice that side inventions created on your own time belong to you.
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Under the Illinois Freedom to Work Act (820 ILCS 90/1 et seq.), an employer’s non-compete or non-solicitation covenant is illegal and void unless: (1) the employee earns above the statutory salary floor ($75,000+ for non-competes / $45,000+ for non-solicits, escalating every 5 years); (2) the employer gives 14 calendar days to review the covenant before starting; AND (3) where "at-will employment alone" is the consideration, the employee actually works for the employer for at least 2 full years after signing (or receives equivalent financial/professional consideration)! In addition, the Illinois Employee Patent Act (765 ILCS 1060/2) protects personal inventions.
Massachusetts Noncompetition Agreement Act (M.G.L. c. 149, § 24L) Garden Leave Redline
Under the Massachusetts Noncompetition Agreement Act (M.G.L. c. 149, § 24L), any post-employment non-compete signed by a Massachusetts resident or employee is STATUTORILY UNENFORCEABLE if you are laid off or terminated without Cause! Furthermore, even if you resign voluntarily, § 24L requires the agreement to include either a "Garden Leave Clause" paying at least 50% of your highest annualized base salary during the restricted period OR "other mutually-agreed upon consideration" explicitly specified in the contract—which employers constantly try to replace with a token "$1,000 signing bonus" loophole!