What ‘please call me’ ruling means – Business Daily

Around 2011, an innovative Vodacom employee in South Africa proposed the “Please Call Me” solution to the telecom. This is a USSD function that allows customers to send a text requesting for a call back.
A dispute arose between the innovator, Nkosana Makate and his employer over ownership rights and compensation. This prompted a protracted legal battle over his rights to the innovation. The employee won the case. However, a second dispute arose over the amount of compensation.
The employer offered him $3 million as compensation which he rejected instead claiming $1.2 billion being an estimate 5 percent revenue of the Vodacom over a period of years. The court in a landmark ruling found that the employee was entitled to 5percent of the telecom revenue over a 20-year period.
This is likely to be one of the biggest intellectual property rights payouts in Africa. The South African ruling puts the country in the limelight regarding intellectual property rights enforcement. Investors are particularly concerned about the intellectual property regime of a country while investing. A stronger enforcement mechanism would attract investment into a country.
The ruling is not binding on Kenya. However, it has a very strong persuasive authority given that there are not many precedents on the subject. The facts surrounding the dispute are a common occurrence in Kenyan workplaces.
There are many employees who propose new ideas, innovations and even inventions for their employers. The employers may go ahead and implement these without monetary and ownership compensation to the employee.
There are some employers who reward such staff with promotions or good recommendations. However, as the case above illustrates this is not adequate compensation. The reward should be based on the value of the implemented solution.
As a general principle, when an employee’s duties include the works under consideration then the employee is not entitled to any compensation or ownership rights. However, when the employee was not hired to perform the tasks that led to the solution and creates such a solution then he is entitled to compensation.
Part 14 of the Industrial Property Act gives the provisions for technovations. A technovation is a technological solution proposed by an employee for the use of a business and which relate to the activities of the business.
At the time of making the proposal then the technovation should not have been in use by the business. The law provides the mechanism in which the employee is to claim for ownership and compensation.
He is required to put in a request for a technovation certificate. Within three months the employer ought to either issue the certificate or give reasons as to why it will not issue the certificate.
An employee is entitled to compensation once the certificate is issued. However, where the employer does not issue the certificate or declines to issue the certificate but goes ahead to use it then the right to remuneration and ownership automatically crystallises.
According to the World Intellectual Property Organization policy papers on technovations, compensation ought to be done at market value.
This provision is aimed at encouraging innovations in the market place. As a staff member if you do have an innovation then you can propose it to your employer. However do follow up your compensation with the business and further ensure the compensation and award you receive is proper.
For employers, it is important to have an innovation policy setting out the rights of innovative employees. This will reduce legal risk exposure due to compensation disputes. A payout of 5 percent revenue over the past 20 years can be very disruptive to any business.


By Kwetu Buzz

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