What is the difference between an NDA and an Invention Assignment Agreement?

An NDA restricts the disclosure of trade secrets and proprietary data. An Invention Assignment Agreement (IAA) dictates who owns the intellectual property created during your employment, often granting the employer rights to anything developed on or off the clock.

How can I protect my side projects from my employer?

Review your contract for 'Proprietary Information and Inventions' clauses, ensure you use zero company resources, work entirely outside of business hours, and check if your state has specific laws (like California Labor Code 2870) that protect employee-created inventions.

A TermScore is an AI-generated risk rating from 0 to 100 that evaluates the fairness and risk level of any legal document. A score of 86-100 means the contract is highly favorable, while 0-30 indicates dangerous terms you should walk away from.

What types of documents can TermScore analyze?

TermScore analyzes any legal document including freelance contracts, employment agreements, residential leases, NDAs, brand sponsorship deals, SaaS vendor agreements, and rental applications. Upload PDFs, Word documents, or images.

How much does TermScore cost?

TermScore offers a free plan with 3 scores per month. The Team plan is $15/month for 30 scores, and the Professional plan is $50/month for 500 scores with team collaboration features.

Is my document data secure?

Yes. Documents are processed in memory and analysis results are stored encrypted. TermScore never shares your document data with third parties and you can delete your data at any time from your dashboard.

Can an employment NDA stop me from working on personal side projects?

An NDA alone typically protects confidential information, but it is often paired with 'Invention Assignment' clauses that can claim ownership of your side projects. If your project relates to your employer's business or uses their resources, they may legally claim it as their intellectual property, effectively stopping you from commercializing your work.

Understanding the Legal Trap: NDA vs. Invention Assignment

Employees often confuse Non-Disclosure Agreements (NDAs) with Proprietary Information and Inventions Agreements (PIIAs). While an NDA prevents you from leaking trade secrets, a PIIA is the document that actually threatens your side projects.

The Invention Assignment Clause

Most employment contracts contain a clause stating that any invention, software, or creative work conceived during your employment belongs to the company. These clauses are often broad, covering anything that:

Relates to the company's actual or anticipated business.
Results from work performed for the company.
Is developed using company equipment, supplies, or trade secrets.

Key takeaway: Never assume your side project is safe just because you worked on it on a Saturday. If the contract is broad enough, the company can claim ownership of your weekend code.

Action Item: Search your employment contract for the word 'Invention' or 'Assignment' to see if you have signed away your rights to future creative work.

Red Flags in Your Employment Contract

When reviewing your contract, look for specific language that signals an overreach. If you find these terms, your side projects are at high risk:

'All work product': This phrase is dangerously broad and can encompass everything you create, regardless of the subject matter.
'During the term of employment': This implies that any work done while you are on the payroll, even at 2:00 AM on a Sunday, is company property.
'Relating to the business': This is often interpreted loosely by legal departments to include any industry the company might enter in the future.

Clause Type	Risk Level	Impact on Side Projects
Narrow Assignment	Low	Only covers work done on company time/resources.
Broad Assignment	High	Claims anything created during employment.
Non-Compete	Critical	Prevents you from working in the same industry.

Action Item: If your contract contains 'Broad Assignment' language, consult with an attorney to draft an 'Excluded Inventions' list if your state allows it.

State-Specific Protections

Your location significantly impacts your rights. Some states have enacted laws to protect employees from aggressive invention assignment clauses.

California Labor Code 2870

California is the gold standard for employee protection. Under Section 2870, an employer cannot require you to assign rights to an invention if:

The invention was developed entirely on your own time.
No company equipment, supplies, facilities, or trade secrets were used.
The invention does not relate to the employer's business or actual/anticipated research.
The invention does not result from work performed for the employer.

Similar statutes exist in states like Illinois, Washington, and Delaware, though the specific language varies. Always check your local labor laws before assuming you are protected.

Action Item: Google '[Your State] employee invention assignment law' to see if you have statutory protections that override your contract.

Best Practices for Protecting Your Work

To minimize the risk of your employer claiming your side project, follow these strict operational guidelines:

Use Personal Hardware: Never use a company-issued laptop, phone, or tablet for your side project.
Separate Networks: Do not use company Wi-Fi or VPNs to push code or access project files.
Clear Documentation: Keep a log of when you work on your project to prove it occurred outside of business hours.
Avoid Conflicts: Do not build products that compete directly with your employer's current or planned offerings.

Key takeaway: The best defense is total separation. If your employer can prove you used their resources, they have a strong legal claim to your intellectual property.

Action Item: Create a 'Project Log' folder on your personal cloud storage to document the timeline of your project's development.

How TermScore Can Help

Navigating the dense legal jargon of employment contracts is difficult, but you don't have to do it alone. TermScore uses advanced AI to scan your employment agreements, flagging restrictive invention assignment clauses and potential conflicts of interest in seconds. By identifying these risks early, you can negotiate better terms or ensure your side projects remain legally yours. Upload your contract to TermScore today to get a clear, plain-English breakdown of your rights and obligations.