Policy Name: | Creative Works |
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Scope: | All Employees & Associates |
Revision Date: | October 20, 2016 |
Last Review Date: | June 9, 2023 |
General Policy: Reliant is a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code, and as such, may only expend its resources for the advancement of the religious, charitable, and educational purposes for which Reliant is organized. Therefore, Reliant may not legally allow its resources to be used for the personal benefit of any individual, including Reliant employees. Thus, Reliant has developed this Creative Works (CW) Policy to provide creative works ownership guidelines for:
It is Reliant's sincere desire (in recognition of the distributed nature of Reliant's ministry and to support the advancement of the Gospel of Jesus Christ), to encourage Reliant employees to develop CW. This policy is intended to offer guidance to Reliant employees contemplating the production of CW to ensure that both they and Reliant understand their rights and responsibilities with respect to such property. Questions regarding the interpretation of this CW policy can be directed to the Reliant Director of Organizational Affairs, who is also a designated representative of the President/CEO to take responsibility for the implementation of this policy. |
In general, Reliant employees are employed to conduct the following types of activities in assigned local churches and/or ministries:
As part of their normal duties, Reliant employees may produce certain types of Creative Works which may include, but are not limited to:
When the CW is produced by an employee within the scope of his or her employment, Reliant legally owns the copyrights and all other legal rights and interests in the CW. This is legal standard under U.S. copyright law that Reliant must adhere to as an employer. Such Reliant Works would include:
Reliant Works developed or prepared by employees within the scope of their normal employment will be considered a "work made for hire" under United States copyright law (17U.S.C. §101 et seq.) and legally will need to be considered the property of Reliant.
Include, but are not limited to the following standard rights to:
…the CW for (an in) all media now known or later developed.
The President & CEO, or designated representative, will be the contact for all permission and licensing requests, and legally is required to oversee the dissemination of all Reliant Works, and establish procedures to protect all published and unpublished Works from unauthorized use or distribution.
A Reliant employee is entitled to own the copyright of an Independent Work (even if such materials have a spiritual or Christian nature). They just need to meet the following requirements:
Examples of uses of Reliant support or resources include, but are not limited to:
The employee will be considered to have not relied upon Reliant resources if the Independent Work is created, edited, developed, and published solely on the employee's personal time (after hours, during vacation, or during approved unpaid leave), and using only their resources, without the assistance of any Reliant staff, facilities, or other Reliant resources.
Reliant recognizes that new works created from existing Reliant-owned Works (known as "Derivative Works",), may be beneficial to Reliant and its mission. Reliant also recognizes that there may be cases where its resources may not be best utilized in the creation or production of such Derivative Works. Even in that instance, however, Reliant might still desire such a Derivative Work to be available to the public.
An example of a Derivative Work would be the development of a new book (Independent Work) from underlying sermons or sermon materials that were legally owned by Reliant because they were produced in the course of normal employment. Essentially, Derivative Works are combinations of Reliant Works and Independent Works.
For anyone interested in creating a Derivative Work, Reliant will follow these requirements:
Given the nature of the employment responsibilities of Reliant employees, it is expected that employees may routinely create Reliant Works in the scope of their normal employment. Employees need to contact the President & CEO, or designated representative, for guidance in determining the ownership rights with respect to the CW that they are contemplating creating.
This advance contact will help to determine if the Work will be classified as an Independent Work, Reliant Work, or a Derivative Work.
It is Reliant's desire to ensure that there is clarity with respect to the ownership rights of such CW and that requirements of any reasonable compensation have been met, if applicable.
Written Notification
Employees are required to notify the President & CEO in writing, or the designated representative, in the following situations:
Written Approval
The President & CEO, or designated representative, is required to give written approvals in the following situations:
Any royalty income belonging to and received by Reliant, that is directly related to CW developed by an employee, will be directed as income to the applicable Reliant MTD account for which that employee is responsible (less any administrative assessments or other financial considerations and overhead as noted in any negotiated CW agreement).
If the field employee leaves Reliant employment and there is no subsequent transfer** of CW ownership or right to use the CW, Reliant has the option to re-direct the royalty income to another Reliant ministry fund.
(**If the employee leaves Reliant employment and there will be a subsequent transfer of CW ownership or right to use the CW, please refer to the Treatment of Creative Works if Employee Leaves Reliant section below).
If the employee leaves Reliant employment, Reliant may use one of several options (but is not limited to) for the treatment of any CW produced by the employee (that legally would be classified as a Reliant Work), including the following:
1. One option is that Reliant will donate the CW to another 501(c)(3) ministry that is in harmony with Reliant's tax-exempt purposes, subject to Board approval.
2. A second option - because Reliant eagerly desires to support the local church where the employee had been ministering, Reliant, in most cases will permit the church the right to use** (but not ownership) the CW to the employee's local church where they are ministering. The local church may then use the CW and also receive any royalty income generated from the CW. If the former Reliant employee later desires to secure personal ownership of the CW from his local church, the employee would need to negotiate an agreement directly with Reliant for the transfer of that ownership from Reliant to the employee.
**Right to use: The reason Reliant retains the ownership rights to the CW is in order to preclude local churches from simply giving the CW to the former employee as a direct pass-through (which Reliant is not permitted to do as a tax-exempt organization). The reason Reliant retains the ownership rights to the CW is in order to preclude local churches from simply giving the CW to the former employee as a direct pass-through (which Reliant is not permitted to do as a tax-exempt organization).
3. A third option would be for Reliant to agree with the employee, to transfer the ownership rights to the employee who is leaving their employment with Reliant (if that employee desires personal ownership of the CW). Reliant is required by tax-exempt laws to first consider whether it is in keeping with its tax-exempt purposes to make such a transfer. After that decision is made by Reliant, the process would require the following steps (these are again required by tax-exempt laws under which Reliant is constrained):
a. No cash payment. In this case, Reliant adds the amount of the Purchase Price to the employee's compensation as additional compensation. Reliant will then list the total compensation on the employee's Reliant W-2.
b. Cash payment. In this case, the employee pays Reliant the Purchase Price in a one-time cash payment.
Under either payment scenario above, the employee is responsible for all personal income and any other taxes due as a result of the purchase of the CW from Reliant.
4. If during their ongoing Reliant employment, the employee desires to personally own any CW he or she produced while still working for Reliant (and Reliant agrees), they could do so under the same options listed in section 3(a) and 3(b) above.
Expenses Incurred: For Sections 3 and 4 above, Reliant will obtain a fair market value of the CW in consultation with legal counsel. Unless negotiated otherwise with the President & CEO, or designated representative, all expenses incurred related to valuing the CW, will need to be paid from the applicable Reliant MTD account for which that employee is responsible.
Reliant employees are personally responsible for all tax obligations relating to income generated from their Independent Works. Employees are also responsible to ensure that no Reliant resources, including work time, personnel assistance or Reliant facilities or equipment, are used for the production of materials produced outside the scope of their employment with Reliant.
If, inadvertently, an employee utilizes any Reliant funds or resources in the production of Independent Works, the employee needs to reimburse Reliant in full for the total costs incurred, and/or costs associated with the services and equipment used.
If no reimbursement is made to Reliant, such costs may be considered taxable to the employee. In such instances, there may possibly be significant tax consequences to the employee for which he or she shall be responsible.
This policy shall be interpreted to fully comply with IRS regulations and ECFA Standards governing Creative Works, including ECFA Standard 7.9, Conflict of Interest on Royalties, which provides as follows: "An officer, director, or other principal of the organization must not receive royalties for any product that is used for fund-raising or promotional purposes by his/her own organization."
All copyright-able Reliant Works produced and/or prepared by Reliant employees, independent contractors, and volunteers within the scope of their employment or their contractual or other duties are required to contain proper copyright notices indicating that Reliant is the legal owner of the copyright. In instances where Reliant determines that the copyright of the Derivative Work can be owned by a Reliant employee (who is creating the Derivative Work outside the scope of his or her employment duties), the Reliant employee is required to specifically indicate the copyright notice of the Derivative Work and all copyright registrations, that the Derivative Works relies on underlying material that is owned by Reliant.
From time to time, Reliant may need to have its employees sign forms to assist Reliant in registering its copyrights in the Reliant Works or Derivative Works, and also may be required to assist Reliant in establishing its copyright ownership.
All employees agree that Reliant can obtain full disclosure in writing of any and all Reliant Works created by the employee at any time during the course of employment.
Reliant may request from its employees, any agreements it needs to implement this CW Policy, but the absence of such agreements does not affect Reliant's rights under this policy.
1 Reliant Work(s) developed or prepared by independent contractors or volunteers at Reliant's request will be considered "works made for hire" under specific guidelines set forth under United States copyright law (17 U.S.C §101 et seq.) and cases, and/or assigned to Reliant by contract or written agreement.