Remuneration for employee inventions

The Employee Inventions Act (ArbEG) essentially governs the balancing of interests between an employee-inventor and the OVGU as the employer. Due to the special relationship between employees and employers, the ArbEG established a comprehensive set of rules, which, among other things, governs the remuneration for inventions. According to these rules, university staff members receive 30% of the gross revenue generated by the university from the commercial exploitation of an invention.

If a service invention has been submitted and is successfully exploited, you will receive 30% of the revenue from OVGU. If you are the sole inventor, you will receive the full amount of 30% of the gross revenue. However, if it is a group of inventors, the group of inventors collectively receives 30% of the gross revenue, which is divided among the individual inventors in proportion to their respective shares in the invention.

According to a ruling by the Federal Court of Justice (BGH ruling X ZR 59/12; ‘Genetic Modifications’), indirect payments to the universities may be included in the inventors’ total remuneration, for example where the licensee covers direct costs for the university as the patent owner and, in return, pays a reduced licence fee. The OVGU does not enter into any licence or purchase agreements in which such hidden payment flows and cost offsets occur; this ensures maximum transparency for the inventors.

 

Example 1:

Inventor A holds a 60% share of the invention, Inventor B 30% and Inventor C 10%. The gross revenue generated for the university through the exploitation of the invention amounts to €20,000. The statutory remuneration for the team of inventors therefore totals €6,000 (30% of €20,000), which is distributed in accordance with the shares of the invention: Inventor A receives €3,600, Inventor B €1,800 and Inventor C €600.

 

Example 2:

Maxine Musterfrau is the sole inventor of a service invention. The invention is sold for €10,000, so Ms Musterfrau receives €3,000 in employee inventor remuneration.

 

Example 3:

Max Mustermann is the sole inventor of an employee invention. The invention is exclusively licensed out on standard market terms; Mr Mustermann therefore receives 30% of the university’s revenue, which is regularly calculated on the basis of the licensee’s gross turnover from the patented subject matter. It is also agreed that the licensee shall bear the annual costs of maintaining the patent, amounting to €3,000, at their own expense. In addition to the maintenance costs, the licensee pays a surcharge of €900 (= 30% of €300) to the OVGU, which is passed on in full as the employee-inventor’s share of these "savings in expenditure for the OVGU%$.

 

If you are an employee of OVGU at the time the invention is completed but leave the organisation later, the amount due to you will be paid out upon exploitation of the invention. In this case, you must ensure that you declare the amount paid to you to the tax office and pay tax on it.

Furthermore, when your employment with the OVGU ends, please remember to provide your contact details (new address, new email address and, if applicable, new bank details) so that we can contact you during the further proceedings and remunerate you appropriately.

 

Frequently asked questions

1. I have only found part of the promised remuneration in my account.
   The remuneration forms part of your salary and is therefore subject to social security regulations. This means that the social security contributions applicable to you are deducted before the amount is paid out to you. These may include, in particular: pension insurance contributions, unemployment insurance contributions and health insurance contributions. The full social security contributions are deducted from the gross remuneration; the employer does not make a pro-rata contribution towards the social security contributions to be calculated.
2. I have the same share in the patent as my colleague, but he receives a different net payment into his account.
   The deductions from remuneration are calculated based on the individual circumstances of each beneficiary. These differ, for example, between civil servants and employees, or depend on the details of the chosen health insurance scheme. Net pay may also change following a change in employment status, such as when an employee is appointed as a civil servant.
3. After leaving the OVGU, my payout amount is suddenly significantly higher. Why is that?
   Once your employment relationship has ended, the OVGU can no longer deduct social security contributions, as you are no longer employed. You are therefore obliged to declare the additional income from the distribution proceeds to the tax office via your tax return; the remuneration will then be taxed appropriately there.
4. I negligently forgot to provide the OVGU with my new contact details and bank account information, and unfortunately only realised this ten years later. Will I now receive the full back payment of the royalties?
   Claims for royalties become time-barred three years after they arise. Consequently, only the royalties for the last three years will be paid retrospectively.